All Forum Posts by: Tommy Brant

Thank you for your input, @Brian Adams! I appreciate you taking the time to provide the breakdown. I like to see how you value the different "lanes" of a syndication deal

Hello BP!

Have theoretical questions. I'm oversimplifying a LOT here just for the sake of questions, and I'm curious to know how other people view this.

1. If we broke down the GP into two roles - fundraiser & asset mgr. How would you weight them? (50/50, 40/60, etc.)
2. What is a good split? 
3. What would be the minimum split you'd take?

Thank you in advance for any/all perspectives.

-TB

Hi @Aaron Kyle Kinslow, There's so many submarkets in Nashville. I invest on the southeast side of Nashville since there's lower barrier to entry. Combine that with knowledge and patience, you'll find homes that will cashflow after expenses.  

Personally, I have a few townhomes in LaVergne, and one in Murfreesboro. Murfreesboro appreciation has been high, so the cash flow opportunities are low unless you find off market deals. LaVergne has yielded reliable cash flow even at retail pricing. Pretty much along the I24 corridor on the SE side has been my market. 

As inventory has been dropping, I've been considering other markets. Personally I've been looking into Clarksville(cash flow, decent inv turnor, lower apprec), Chattanooga(cash flow and moderate apprec, risk of flood insurance in some pockets), north AL, some pockets in KY. 

With all that said, cash flow is my criteria currently. Looking for a quadplex currently so I'll likely need to cast a wider net(FL, TX, OH).

You're only going to fail in real estate if you stop, so keep going. Continue to learn your markets, analyze properties, and build your teams(local and remote).

Hope there's something in there that provides value.

Hey @Derrick F.

It's going to depend on two things - 1) their HOA, and 2) their rental strategy. If they are in a townhome, I would expect their HOA to have guidelines on renting in their terms and conditions. I recommend them calling their HOA phone and inquiring.

I say rental strategy is a consideration because long term rental and short term rentals are viewed differently. Nashville's short term rental policy has evolved a lot over the recent years. If you were going to get some resistance from your HOA, it's likely be around short term renting. If you are long term renting, this is less likely to get any resistance(although it still depends on what your HOA allows for).

If that townhome is not governed by an HOA, I don't know of any other restrictions to prohibit you from renting/leasing.

FWIW - I have three townhomes I rent with two different HOAs. I personally love renting out townhomes because they are lower risk - the HOA maintains the lawn and exterior(i.e. roof/gutters/siding). As a result, insurance is cheaper on townhome. Only downside is that pesky HOA fee ;) Full transparency, I'm in Rutherford Co, not Williamson.

Hope this helps!

Hello BP! I'm exploring buy & hold SFH rental properties in Shelbyville, TN. Barrier to entry and expenses are low. I've asked for opinions from my property manager and realtor, but now I want to know your opinion.

If someone has had experience buy & hold rental in Shelbyville, TN, I'd be curious to know how your experience has been? Any lessons learned on area/neighborhoods/home type?

Thank you in advance!!

Hi @Cole Farrell. 

Craigslist may be a good resource. Try Thumbtack. There's another one where you hire college kids to help you move(maybe in this case you could hire them for other labor?)

Hi @John Hinnant, I would think you'd need to be a co-signer on the loan. I'm not sure about minimum reqs for solo loan. 

Disclaimer: I'm not a financial expert

Hi @Kristen A Gleason. I recall the same passage in the book, ha. I think about the same thing when I look at properties with sizeable lots and added structures. 

One thing I'd consider is the tenant. If renting out that storage unit doesn't impede on your tenant's hospitality, then go for it. 

Fun scenario - let's say your tenants are a couple, they have two cars, and are at home. The person who rents your storage shed is coming by to store their lawnmower for winter. Would those interactions be able to operate independently, or do you have to call people to ask them to move their cars?

If it's there's a low chance of collision between those revenue streams, then that may be worth an extra $300/mo. Be sure that administering that would be worth your time.

If it's a small shed on a small property without garage, I'd lean toward giving to the tenant and build it into the monthly rent rate. 

Hope there's something there that's helpful! best of luck!

@James Ewing - you're biggest returns are going to be where you can value-add on properties. To me, that screams BRRRR. If you can start with a distressed property where you can repair/reno/rehab, you will learn a LOT, and it will take you a LOT longer than expected(highly probable). Your scaling this will depend on the amount of risk you're comfortable with.

Something you might consider - buy a cash flowing, rent ready SFH. (townhome, etc.) Although this isn't a HUGE leap forward, it forces you to put your TEAM and you SYSTEMS in place. Who is bringing you deals? How is the financing on these deals? Who is managing these properties? How close are you financial projections - theoretical VS actual? You may get a couple knicks and bruises along this route, but I would consider this to be a very low risk, low barrier-to-entry way to start your rental portfolio.

If you have systems/team in place to acquire and manage a SFH, then it's not a huge ordeal to pivot to BRRRR. It's just 1-2 extra steps.

I was in a similar situation to you when I started aggressively looking and learning to invest. I've been am conservative on my real estate analysis as well as how I approach these deals. Money is energy, and knowledge is power. If you use your money in a way that yields you money and allows you to learn, then you are winning IMO. I'll sacrifice a little ROI if it's something new I'm trying(solong is I'm still cashflowing).

Hope there's something in there that's helpful. Best of luck on your journey!

Hi @Sergey Mikhaylyuk. I concur with the crowd in the responses that all lenders are different. To share my experience on a rental I purchased last year: my lender offered me down payment options ranging from 15%, 20%, or 25%. Each one of those, would yield a different interest rate. (15% down would demand a higher rate, 25% down would be a lower rate, etc.) We ended up settling on 20% down because the added money need of closing at 25% wasn't worth it given the low interest rates.

I haven't come across the added fee regarding distance from your primary residence to the investment property, but I'm also close to my rentals, so maybe it just didn't apply. I would recommend shopping around lenders(at least 3) and pit their rates/fee structures against each other.  

Best of luck!