All Forum Posts by: Vince Mathis

@Isaac Johnson I live in Phoenix, AZ, but went to HS in Madison SD and still have family in the area.

I have one duplex (see my profile), which I manage from AZ, and am currently acquiring a quad which will be professionally managed.

SF is a great market, even with current prices, there is a lot of opportunity.

I would recommend gettin on MetaStone Properties mailing list as well as joining the SDREIA.

Let me know if you have any questions!

@Jacob Stone

Can personally recommend @James Kats as one of his Out of State Investors. His personal experience as an investor and a diligent agent brought me a ton of value. I was able to confidently fly in and close, having never personally been to the property.

Not a CPA, not a Tax Professional, but I am a Mathis!

From what I have found as I begin to file my own taxes, is that if you are a Passive Investor, and file your Rental Income on a Schedule E, then you are not required to provide 1099s. Landlords of only a few properties that do not require more than collecting rent and facilitating occasional repairs are not considered to be in the capacity of a business. If you were a flipper than you would be considered actively engaged in business and would be required. Passive Landlords also do not have the ability to put schedule E losses against active income, as one can with a business.

This is discussed many times around BP. 

If you tend to be more conservative with your risk, you could provide 1099's. There is nothing saying you can't, but there is nothing saying you must.

@Pete Krentz I'll check with my loan officer.

@Nathan Anderson

Can personally recommend @James Kats as a knowledgeable local investor and investor buyer's agent.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Sioux Falls.

Purchase price: $149,000
Cash invested: $37,250

Duplex in C-Class Neighborhood near downtown, 3 blocks from major hospital, and 8 blocks from a university. Each unit is 2 Bed, 1 Bath, with unfinished but dry and bright basements, in-unit laundry, and a garage stall. Home was built in 1916, has solid bones, foundation, and a new roof, although electrical has multiple generations of knob and tube and shielded wire with some new romex.

Purchase Price: 149k
$37,250 (25%) Down Payment + $3,750 Net Closing Costs
30 Year Fixed 3.875% Loan

Current Rent: $1,350 per month (675 x 2)

Expenses:
PITI: $780
CAPEX: $135
Vacancy: $100
Maintenance:$100

Current Monthly Cashflow: $235

Immediately after close rebuilt rear stairs, replaced kitchen faucet, a fridge, and a water heater (with seller cash from close). Planning to completely remodel both bathrooms next spring. Expect to raise rent to at least $700/mo after bathrooms are remodeled.

What made you interested in investing in this type of deal?

We (wife and I) live in Phoenix, AZ, but the price to rent here is double what it is in Sioux Falls. We are seeking to purchase at least one multifamily property a year in Sioux Falls (or Phoenix if prices drop or a deal is found), for the next 8-10 years, then begin flipping that equity into bigger multifamily/commercial properties.

How did you find this deal and how did you negotiate it?

Had multiple MLS aggregator triggers as well as a local wholesaler in the area. This property was MLS and due to being pre-approved, and familiar with the market was able to get an offer in within 24 hours of listing.

How did you finance this deal?

I work for a large, regional bank, and was able to get a 3.875% for 30, fixed. I shopped around but was getting around the same costs and I'm able to meet my mortgage banker and processor at any time.

How did you add value to the deal?

So far, have cleaned up some safety and maintenance issues including the rear stairs, fridge, and kitchen faucet of one side, and the water heater of the other.

To actually drive value, we will be doing complete renovations of the bathrooms next spring.

What was the outcome?

So far, so good, but expecting there to be bumps and learning experiences as we go.

Lessons learned? Challenges?

We will be managing this from long distance. To do this, we met the tenants in-person up front and provided a 'Welcome Basket' to thank them for their patience through the sales process. They had been hand-delivering checks to the local landlord, but got them set up with TenantCloud . com to automate the process, where they may also submit maintenance requests.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

James Kats is a Sioux Falls Investor and Agent and has been instrumental in this process. We've established a relationship that will be very valuable as we continue on this journey.

There are definitely good numbers in Sioux Falls, but at a smaller scale than many markets. I'm looking for Buy&Holds in SF myself, though I live in PHX. I have family (including a licensed plumber) in the SF area that will be partners.

Not going to make this one. Hope to make it in March. Thanks Travis!

Was great to meet everyone last night, hear how everyone is doing and how and where they are making deals. Looking forward to next month's event!

Hello All!

Recent discoverer of BP, looking to start investing in about a year. I'm a fairly methodical person and want to get plenty of education and build contacts before I dive in. I'm also doing some financial house cleaning over the next year to increase debt-income ratio and open up liquidity. I currently have a "Side Hustle" as a Company Commander in the Army Reserves with a little over a year left on my contract. Once I'm out I'll have more time to dedicate to researching deals and BRRRR-ing. Looking forward to the Phoenix Area Meet-Up this evening!