All Forum Posts by: Tyler Bobo

Hi Prince,

Welcome to BP from way up here in Alaska! 

If you already closed the deal you sold you may have missed your window for a 1031. I'm not 100% sure, but that's my understanding.  Call a quality Realtor and ask them for a referral to a good 1031 exchange company for clarity on that.

I'm not positive I understand your question in the last sentence, yet I do believe you can take your profits in a deal that you're doing a 1031 exchange and buy 2 properties (a flip and a rental) if you choose, but the portion that you use towards the flip, once you sell the second flip you'll have to roll it into another 1031 property or pay all the taxes then.  Again, no expert on the 1031 though I've done a few over the years, that's just my understanding.  

Also, read or listen to Tom Wheelright's book, Tax Free Wealth.  He has lots of good strategies in there you might like.  Good luck.

Brennan, if there's lots of out of state sellers that's great. Ehsan was referring to a website called listsource, you can buy a list of addresses and stuff but if you're targeting a real specific area you can make the list yourself from the tax records and mail them. Try it a few times like was mentioned and if your response is not good try door knocking anyways.  You can tell whoever opens the door that you're interested in buying and if they know how to reach the owner.  
      And, if you swing by the local Keller Williams office there's a lot of teachings about door knocking for listings so this would be a great opportunity for a new agent to try to drum up you a deal and themselves some business, and all those tenants are potential buyers, so swing by a KW office and find someone who is hungry.  There's a LOT of hungry Realtors in any market center!  (If you google realtors or call one from signage/etc you're more likely to get one who is in higher production and already has listings and money for web advertising and they may be too busy to go door knocking, that's why going to the local office will be best if you want someone else to do that part.)

     On the flip side, if you find the deal yourself you may be able to negotiate better yourself than a newer agent if you're good at that.  Good luck:)

I'm not a lawyer but I don't think this would be a problem.  Since you're not selling, or creating them, you're actually the one doing the borrowing, I'm not sure how that would be a problem.  But always a good idea to run it by a real lawyer:)

I would sit on a beach and eat shrimp.

I'd still invest though:) Can't help it.  
     So in that position you've got options, you can be super hands on and do all sorts of investment strategies that interest you, or you could be passive and invest with someone like me (wink wink) who can put it to good use without you having to do much. You could be passive investor in syndication, you could be a hard money lender, you could buy properties that cash flow nicely and put quality managers on them, etc.

I think if I had that much in cash out of the blue I'd have to think about it a while before making rash decisions, but one thing I'd seriously consider is buying a solid piece of property (commercial, multi, mobile home park) that I could pay for mostly cash, so something under $1.5M, and before closing have a line of credit on the property lined up.  That way, I'd have a solidly cash flowing investment and not lose all my liquidity, and use the line of credit for smaller and medium deals, or even do larger ones using that to leverage into them.

1) You said according to Zillow. Zillow is notorious for being the worst estimators of property value ever imagined. I can't tell a 20,000 trailer listing was a trailer, and valued it at like 300,000 based on zip code and square footage.  I could ask my dog for an estimate and she'd beat zillow's 4/5 times.

2) If you sold it to reinvest into another property you could do a 1031 to avoid any capital gains you would have since you plan on reinvesting anyways.. (so you're number 1 and 4 are the same)

If you can afford the negative cash flow for the appreciation it's gaining that's not bad, I wouldn't want to leave that much money in it though, you could pull that out as a refi and use that cash in something that cashflows (maybe not local if the market is that crazy there) and then not be losing money every month:) 

If your cash flow is $360 and you think you have 80k in equity (hopefully after closing costs?) then I'd say probably sell.  If you miss your window and haven't lived there 2 of the last 5 years (like if you choose to sell several years down the road) consider a 1031 exchange and you may be able to get out of the capital gains as well.

A go getter Realtor will go door to door looking for you a property.  This of course, is if it's a good neighborhood.  As a Realtor I don't like door knocking some places that are too rough and also places that are too rural where the doors are too far apart and you'll encounter an unfriendly dog too far down a driveway.
     And you can certainly do this yourself as well, just go door to door and hand out a card or something and ask who they know that might be interested in selling.

You can also send out mailers, or hand written letters on hand addressed envelopes.  Most areas you can get the owners name and mailing address on the tax website. Good luck.

I think it's a fine idea to pay more (if need be, and the numbers work for you) to get the financing you need from the seller.  So if you pay 80 instead of 60, that costs you 20k, but may save you some in interest too if you do it right, and more time potentially than the hard money lenders.
If your sellers trusted you enough (and could afford it) for no money down, 80K with no interest for up to 18 months or something that's plenty of time for you, you'd do an owner finance deal where he got a note on the property until you sold it. Should work great. I've done a similar thing once and it worked out great.

That depends. The most profitable usually comes from the motivation of the seller, so finding the most motivated seller will usually be the most profitable.  I started with single family and still do mostly that for flips and rentals, but there's great benefits to multi's as well.  If you plan on investing locally, check out which has more opportunity in your area.  If you are interested in long distance investing both can work. More units has less risk when you have a vacancy, but it's mostly about buying right and making sure it's a good deal when you go into it.