All Forum Posts by: Wesley Mullen

@James Devoe We're looking in-state, in an actual pretty tight/specific location (like 15-20 mile radius), which makes it more difficult. It might just be not a valid option.

I'm curious to get people's opinions on whether it's better to build a house in today's market vs buy. We have been looking to add to our portfolio for several months, but have been unable to locate any deals that cashflow, given high prices and interest rates. We've still been keeping an eye open, but have also turned to a new idea: finding land and building on it (in turn adding our current residence to our portfolio). The trouble with this idea is actually locating land - it seems it is just as scarce as properties. Whether looking to build a new primary or even spec building, has anyone seen better results vs buying existing properties? 

On a tangent, this has also turned my attention to potential minor subdivisions - buying a large piece of land and re-zoning it to put multiple properties on it. My grandpa actually did this in rural Missouri. However, in just scratching the surfaces, this looks to be highly complex, with lots of legalities involved and outside my novice knowledge & price range. I tend to think up big ideas, but then usually do not have the resources to act on them. It's been 2 years since we purchased our first rental property and we're itching to get more. We just wish the market would cooperate. Is anyone else experiencing this frustration? 

@Michael Clayborne I hadn't heard of the Ron's Coffee group, I will take a look at it. I sent you a Connection Request. Perhaps if you ever want to grab a bite/beverage, we could make introductions and chat sometime! 

@Cassi Justiz Thank you for the insight! I'll look into the group more & talk to my co-worker who is a member, maybe try to plan to attend a meeting with him to try it out. I'm sort of surprised that Norman doesn't have its own given it's size and number of rentals given it's a college town too. I might have to locate some other Norman investors and try to round up our own meeting!

@Dmitriy Fomichenko Thank you, Dmitriy! It's similar to my first tornado when storm chasing. After one, you just want more. Same with investing: I can't wait to pursue a second deal!

@Andrew Syrios Thank you! It is nice having partners I must say. And yes, though not in a rush. I'm sending direct mail in a neighborhood that we like and used to rent in (no luck thus far). We're also keeping an eye on the MLS. We're also open to several different avenues of A) another SFR/small Multi, B) A lake house to use ourselves and STR or C) New primary and rent current. We're interested to see what happens to the market with the rising rates.

What is your portfolio like?

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $125,000
Cash invested: $32,100

We started self-educating about REI in Dec 2020 and by Jan 2021, stumbled upon a friend who was in the process of buying a new home, which was contingent on selling their current home. After looking it over and running the numbers, we agreed to purchase it for $125k directly with no agents. Because the seller was able to avoid incurring additional costs to make the home ready to sell as well as avoiding commission fees. It was a solid first investment opportunity, capable of meeting the 1% rule.

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

We knew we wanted to buy & hold and this home was located in a solid area. Personally knowing the seller made negotiations and the closing process uber simple, especially for our first deal.

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

In discussing our new passion for real estate, a friend from the gym advised they were buying a new house and needed to sell their current one before they could close on the new one.

How did you finance this deal?

Traditional mortgage with 20% down.

How did you add value to the deal?

By working directly with the seller, we were able to avoid agent commissions and the seller incurring additional costs making the home 'sale ready'. After closing, we performed minor cosmetic improvements ourselves.

What was the outcome?

A solid first investment deal that cash-flowed from day 1 with the 1% rule. After one year, the tenant has renewed the lease along with a market rate rent increase.

Lessons learned? Challenges?

The tenant had a number of minor maintenance requests early on and we were afraid of a needy tenant. However, after the only major issue of replacing an older toilet, we have had no major issues to-date. We would be sure to look over smaller details such as the doorbell chime, exterior lighting before rushing to get a tenant filled.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $125,000
Cash invested: $32,100

We started self-educating about REI in December 2020 and by January 2021, stumbled upon a friend who was in the process of buying a new home, which was contingent on them selling their current home. After looking it over and running the numbers, we agreed to purchase it for $125k directly with no agents. Because there were no agents involved, the seller was able to avoid incurring additional costs to make the home ready to sell as well as avoiding commission fees. Therefore, when running the numbers, it was a solid first investment opportunity. The home did some minor cosmetic rehab in which we used our dad to help assist with, taking roughly a month. We had a tenant lined up the next month and had her moved in starting month 3 of ownership. We also were able to get initial rent at $1300/month, so we were just over the 1% rule. We do use a PM and have been greatly satisfied with his service. Fast-forward one year, the tenant has renewed her lease with also a market rate rent increase to $1400/month.

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

We knew we wanted to buy & hold and this home was located in a solid area. Personally knowing the seller made negotiations and the closing process uber simple, especially for our first deal.

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

In discussing our new passion for real estate, a friend from the gym advised they were buying a new house and needed to sell their current one before they could close on the new one.

How did you finance this deal?

Traditional mortgage with 20% down.

How did you add value to the deal?

By working directly with the seller, we were able to avoid agent commissions and the seller incurring additional costs making the home 'sale ready'. After closing, we performed minor cosmetic improvements ourselves.

What was the outcome?

A solid first investment deal that cash-flowed from day 1 with the 1% rule. After one year, the tenant has renewed the lease along with a market rate rent increase.

Lessons learned? Challenges?

The tenant had a number of minor maintenance requests early on and we were afraid of a needy tenant. However, after the only major issue of replacing an older toilet, we have had no major issues to-date. We would be sure to look over smaller details such as the doorbell chime, exterior lighting before rushing to get a tenant filled.

@Brandon Griffin @Cassi Justiz @Cary Verner I'm late to the party, but also have been telling myself I need to network more and attend some REIA meetings. I'm an admitted introvert, so need to bust out of my clamshell. Are any of you aware of any REIAs in the Norman area or are they mostly always up in the city? Either way, I think I need to pull the trigger and get to one. I was actually just introduced about Millionaire Possibilities by a co-worker.. I just discovered he is also just got into real estate and advised me he is a member of that group. However, when he mentioned it was a paid membership, I was a bit skeptical/caught off guard. I'm curious to thoughts on that particular aspect? In talking REI to my co-worker, as well as another friend who is interested in getting started, I've learned I really enjoy talking about the subject matter, so perhaps busting out of the clamshell may be easier than I thought!

@Dena Puliatti Sorry for the delayed response! I think the reason to use him or one of his colleagues is that the transition from purchase to getting the the home rent-ready and tenant installed would be quicker, i.e. they could begin searching for prospective tenants sooner than if we used a different agent. I can see how it could be beneficial to all parties vs using a separate agent and not being able to be involved until the transaction is complete. I did check and confirm he has his license so why the red tape.