All Forum Posts by: Tom Wagner

Depending on where you are, I don't think the STR market ever went away. A lot of people worked remotely all year and continue to work remotely, so hosts that adjusted their business models to be conducive to long-term stays did very well!

The pro forma is just an estimate until I have tenants in there and get the building stabilized. I've underwritten 5% of annual rental income for repairs and 5% for maintenance, so $12,000 total. I am hopeful that this number is much higher than what actual expenses will be for the first 5-7 years, because almost everything in the property will be new: new roof, new plumbing, new electrical, new appliances, new kitchens, new bathrooms, etc.

Generally, I've seen people use 10% of rental income as a hand-wavy estimate for ongoing expenses, though on older homes you may want to increase that to 12-14%.

FHA and 203k mortgage products are only available to owner-occupant "investors", so out of state is not an option. It really is your best option and I would encourage you to read a book on house hacking to fully understand why!

While this forum is a great place for investors to offer their opinions and discuss different options, there's only one right answer here: a 3.5% down house hack via the FHA or FHA 203k loan, ideally to buy a triplex or fourplex

When used responsibly, this move has a 95%+ chance of jumpstarting your real estate career and generating more wealth than any other option. It is truly the only way to generate returns meaningful enough to change your life with as little as a few thousand dollars down.

If you are really short on cash you can ask the seller to cover the UFMIP and/or closing costs.

In order to find the *best* deals you need to be watching the market yourself. Your agent likely has a number of clients and is very busy, so if you rely solely on your agent great deals will inevitably fall through the cracks.

Just my two cents.

Check out the 203k loan! I recently closed on a $1mm fourplex in Jersey City, NJ and wrapped in a $450,000+ renovation budget into the same note, totaling over $1,450,000 with just $60k down. For more details check out my twitter thread on my purchase:
https://twitter.com/twbuilds/s...

Feel free to DM me on here or on Twitter if you have any questions.

Lauren Clugston has some good stuff on mailers on her instagram account! 

https://www.instagram.com/rent...

There's also a BP episode on mailers:
https://www.biggerpockets.com/...

The most important thing you can do to amplify your returns and accelerate your investing career is ensure that you are able to get as much of that $40k back as possible via the BRRRR method. Check out the forums and check out Brandon Turner's book for more info!

It all comes down to one thing: **LEVERAGE**

If you invest $100,000 in the markets and your investment returns 7%/yr, your investment will be worth $196,000 in ten years (100k x 1.07^7), so your total return will be $96,000.

However, If you buy a property for $500,000 and put $100,000 down (20%), you'll get to reap the benefits of the appreciation and cash flow on a $500,000 investment, even though you only put down 20% of that amount. If the property generates $10,000 in cash flow per year, you pay the principal balance down $8,000/year and it appreciates at 2% year, your total return will look something like this:

$10k cash flow x 10 = $100,000

$8,000 principal paydown x 10 = $80,000

$500,000 x 1.02^10 = $609,497 - $500,000 = $109,497

SO, your expected total return will *CRUSH* the stock market alternative, totaling almost $300,000 total vs. $96,000. And these numbers get even juicier if you benefit from significant rent appreciation or property appreciation, or if you decrease your down payment percentage.

Sure! I worked with Scott Saypol at Loan Depot and had a good experience. I’d also take a hard look at Jeff Onofrio and Bill/Melissa Grath.