All Forum Posts by: Vincent Mazzaferro

Thanks for continuing to put these together John!  I learn something at every event.

I know this is an old post but had some interest in Bozeman MT and reading this now.  Thanks @Michael Rutkowski for posting your information here.  I will reach out to you.

@Lee Stephens

You said this is your first deal.  I can tell you that this property is in WAY better condition than the condition of my first property.  Every property has problems and things that can be fixed or improved.  This property looks clean and nothing you mentioned was a deal breaker to me.  From the pictures it seems that you can rent it out tomorrow (although maybe not at the top of the market).  I think you need to ask yourself some questions.  

How many 4 unit properties are currently on the market with a new boiler, all new windows, and a perma-sealed basement for $400k?  

How much cash are you risking to gain control of this asset and it's $4,000 monthly revenue stream?

How much do you REALL NEED to spend to make this asset perform?

Where else are you going to put your cash to generate a return or hedge against inflation?

If this first deal of yours is the all popular, FHA, 4-unit house hack, I would advise you to jump in. You can't make a better decision on a first property purchase than that. I myself bought a 3-unit, on an FHA loan, 3.5% down, house hacked, and it was a game changer for me. Taking control of your first real estate asset will most likely be game changing for you too.

This sounds great!  With cap rates where they are, this is exactly the type of content I want to tune into right now.

Sorry, I forgot that you hired a manager.  That is what the manager should do.  Good point by @Patricia Steiner.

Listen to @Joe Splitrock.  

Firstly, give him the benefit of the doubt and remain friendly and professional.  If you think he will trash the apartment, schedule inspections (frequency based on your perceived risk).  You have the right to inspect your property, as long as you wrote that into your lease.  Communicate periodically and set your expectations for maintaining the property.  If he pays the rent, is friendly to neighbors, and maintains the property, then do nothing.  If he begins to destroy your property, document it, fix it, and send him the invoice.  If violates the lease, put it in writing and send him a warning notice via certified mail.  Break the lease if he continues to violate the terms and conditions of your contract.  

Manage the property like a professional.

@Chris Clothier wrote a fantastic paragraph above that I recommend anyone new to read one more time:

"  Of course, cities matter and locations matter, but consistent positive cash flow, is realized by how well a property is renovated and managed. The cash flow itself is created by usingleverage, but the only way to maximize it is by reducing deferred maintenance, eliminating the need for capex for as long as possible and preventing vacancies. That has little to do with the city and everything to do with who you use to provide the active services of renovating and managing your property.  "

My commentary; everything matters.  Even if you buy a good property, in a good neighborhood, there still many things that can affect your performance over time.  

I've been looking at commercial so this is perfect timing for me.

@Jody Sperling has great advice and some others here do as well.  
My advice?  Grab a hammer and start watching YouTube!  I'll be rebuilding two shower valves tomorrow and replacing a toilet.  

@Art Perkitny where did you get that data from?  I'd like to look at that kind of stuff if it is available.