All Forum Posts by: Tyler Blodgett

Looking to build a 5 plex new construction. Total all in cost I am estimating to be about $1.1M. Need help figuring out Principal, Interest, and Tax breakouts for my budget. I already have an insurance quote. Also, any recommendations on financing options. Construction loan then convert to conventional? Also, looking to see what my CAP rate will be to determine value of building after construction is complete, in case I want to sell it shortly after completion. Rents will be about $1,500/month/unit. Thanks!

@Matt Bailey I could not recommend Crystal Towe enough.  She is a realtor as well as a property manager, and she herself is an active real estate investor.  Give her a call and let her know I referred you to her.

Good luck!

Tyler

I have been sitting on the sidelines for quite sometime doing my research, but feel I am ready to take the plunge and purchase my first investment property. I am in the process of starting to look at properties and analyze them, however I have not been able to find a good proforma to work with. I feel like some are too simple (looking only at rent coming in, and PITI going out), and others are too complex (Factoring in anything and everything) to the point where I can't see any property penciling out ever. I am fairly good with excel, and have though about creating my own multi-tab spreadsheet, but before I re-create the wheel I wanted to get some input on if there was already a good "balanced" one out there, and if not, what are the "real" items I should be factoring in on my proforma where I am covering my bases, but not being overly aggressive or conservative.

Also, along these same lines, what is the best way to calculate taxes (if they are not available), and Insurance for my PITI calculations? Obviously I would get actual tax rates, as well as an insurance quote prior to an actual purchase, but for initial high level analysis looking for some direction.

Thank you in advance for any feedback.

I know this is more of a personal financing question, and it could go either way, but I was curious to get some thoughts on the matter.  I currently live in the crazy state of CA, and always have in the back of my mind the idea to cash out and move somewhere much more affordable.  I would use the equity I have from my house and other assets that I sell in CA, to give me a big jump start on my real estate investing career in the more affordable area.  The question I have is, would it be better to purchase with cash (from my CA asset sales) my personal house and cars in the the more affordable state which would reduce my monthly expenses, but would also take away from my available cash for my rental properties? Or is it better to get a mortgage and finance my cars in the more affordable location and have more cash available for additional rental properties?  Put another way, is my money better spent working for me in rental properties (which would ultimately help pay for my personal house and cars), or reducing my monthly expenses?  Thanks for any insight in advance.

@Brent Coombs Thanks for the comment.  I am just looking for additional ideas and insight on how others do it.  It would seem obvious to search the usual spots to find this information, but was curious if anyone had a better site, program, or way to do this.  I am always looking to improve, and to be more efficient with my time, as I would hope everyone would be.  Obviously I would not move forward with a property unless I ran, and understood the numbers fully.  I am a Preconstruction Manager (estimator) by day and live and breathe numbers and spreadsheets daily.

@Ben Wilkins Thanks for the heads up, I will definitely take a look at those sites.  Let me know if you get any headway on the IFTTT on the rents.  

@Ben Wilkins Thank you for the reply.  I agree it would be nice to have most of the work, if not all, already done so I would have less carrying costs and could start generating income once I find tenants.  I recently finished a major renovation of my own home, and it was quite the task, albeit I would probably approach a rental property from a different perspective.

Curious as to how you go about finding the rental range you can charge for a potential investment, and how you determine demand in the area.  Is it just a matter of manually searching online for similar specs to your subject property and comparing?  Would be nice to have a program that is able to automatically extract the info from craigslist or other and export it to an excel file to sort (beds, baths, sf, rent).

Thanks again for the response.

@Grant Rothenburger Thanks for the response and the advice.  I myself work for a larger GC, so I feel very comfortable as it relates to construction related issues.  I plan on finding a great inspector to team up with, even if he costs a bit more than the norm, I feel the few extra bucks up front could save me from a world of hurt later! Thanks again!

I have been looking from the sidelines for quite a while, and hope to make my first purchase this year.  I learned from reading @Brandon Turner's book that typically you make your money on a property when you buy the property by making sure you get a good deal.  I recently came across a newly renovated (I am guessing a flip) duplex that is in my price range and looks like it might be something to take a deeper look at.  My two concerns are first that the flipper is looking to make a good return and therefore will be less inclined to make a deal, and second that most of the potential added value has already been added with this renovation.  I know it should all come down to the numbers, but I wanted to get some advice/insight from others on your thoughts regarding purchasing a recently renovated property... Thanks in advance for any insight anyone adds.

I am new to this, so I hope I am doing this right... I feel like most people start their discussions with a brief intro, so I figure I will do the same... I believe I am in a unique situation, and am primed to jump into real estate investing. I worked part time at a Real Estate company, and as a realtor while going to college, mostly just did deals for Friends & Family. I graduated in Construction Management, and have been in the construction industry for the last 10 years, working for a large and mid-sized GC. With a growing family, and being in the construction industry, I have moved around CA quite a bit for the last decade, and am now in my 5th house in 14 years. Even without the investment mentality, I was able to make pretty good money on all the transactions, including my last sale where we didn't use a realtor. My last purchase I did a major renovation that took about 7 months to complete. With my experience working in a Real Estate office, my "multiple" personal home transactions, as well as working in the construction industry, I feel I more prepared than most to get started in Real Estate Investing, specifically buying, renovating, and holding for the long term (See Brandon Turner's BRRR approach). However, having said all that, I don't want to assume I know everything, I know I don't, and am trying to soak up all I can to make sure I am truly prepared for my first real investment property. Now that I have set the stage, here is my first of many questions:

I know there are many benefits to going in with an all cash offer, and that often times if you do go in with an all cash offer you may be able to get a better deal.  The question is, would it make sense to use a majority of my investment cash to go in with an all cash offer to get the better deal, then a few months down the line (maybe after Reno is done to avoid some carrying costs) get a mortgage at that point, and pull most of the cash back out for the next deal? (I was exploring something similar to this on one of my personal houses a few years back, and I believe in CA you have to wait 6 months to pull the cash out).  Or would I be better off getting a mortgage right at purchase, then use the remaining cash for other deals I may miss out on while waiting for my cash to free up?  I can think of some pros (better deal, quicker deal, less carrying costs, etc.) and cons (interest rates possibly going up, all my eggs in one basket, etc.) to both, but I am curious to hear from others to get their perspective. Thanks!