All Forum Posts by: Zack Thiesen

@Dakota Coburn Thanks for sharing your story, no need for me to dogpile what others have said..but i think if this were me the toughest part to reckon with would be bringing other peoples money into it. Of course if it's all your own money, it is at least that much more bearable to deal with.

Even still.. i hope you are okay mentally and emotionally, I can only imagine the stress. Take care of yourself and keep on! But with lessons learned.

@Steve K. Hahh, i love that, i'll have to tack that on there

@Cory Hinton I think generally it is just better (if cash-flow is your goal) to put the declining economy narrative out of your mind somewhat and look at what rents have done historically. But just wanted to add that I am not saying to discount the local economy completely... it can matter if you think your area will descend to a point where the cash flow property you've invested in a decent B- neighborhood will be a D neighborhood in 5 or 10 years. Then you're talking tenants that correspond to that who eat your cash-flow for breakfast and then ask for seconds. But you will know that much better than I would. If you're talking an economy that just doesn't have much going for it but the community is strong and things still seem to work out year after year, that's another story. 

Ultimately, you just want to know your strategy and then consider things that can be obstacles to your strategy. If you work your way through those scenarios and numbers on your personal go/no-go list, then you'll be solid.

@Cory Hinton So far I have only invested in my local market here in California. But it is getting impossible to work within my goals anymore so this year I will be moving into out of state markets. One of the markets I've looked into the property values are virtually stagnant/declining but is not much of an issue to me as long as I'm working to find true deals. At this point in the market cycle even a lot of the historically stagnant markets are experiencing little bumps in value and thinning inventory/higher demand, especially with multi-family buildings. This leads to temporary and artificially high valuations on some properties. Thinning inventory with certain types of buildings also means it's riskier to BRRRR because there can be less comps for an appraisal.

TLDR: In this environment it's especially important to look at and to know exactly what you are getting for your money and if it doesn't makes sense within the framework of your personal REI goals, to walk away and keep looking or wait. People that buy from the heart and pay retail at the top of a market are apparently out there driving all of this... as long as you're not one of them you'll be good! hahh

@Cory Hinton With BRRRR the end-goal is often to buy and hold as rentals and piggy-back one on the other. So for many people that's a cash flow strategy and depends less on appreciation and you mainly just want to look at what rents are doing. If you're BRRRR'ing SFR's to start, building a portfolio to sell off and re-invest in scaling up from that within the next 5 to 10 years, then you'll want to concern yourself more with where the prop value will be at that point. All depends on what you want. Some places you look the properties have been nominally flatlined since like the early 90's or even 80's (which is actually a decline if a 65k property has not increased from that number with inflation and is still 65k) but you might not care about that since rents themselves have kept up with inflation.

@John Montgomery So true, that feeling is just not what you want in the trust department with a customer and things can definitely be taken out of context. It has nothing to do with you trying to get away with anything. It's the same feeling I get when clients "hover" or micromanage on jobs. I understand the need to come in and check in with what's going on, even multiple times a day, or if they're in the home all day. But getting micromanaged and not trusting me and derailing the systems I've got in place to maximize efficiency and get the most out of my bid is not ideal for me. My saying is "I charge X for the job and double if you watch"

And for the sake of me not hijacking this thread with my opinion on that, I am definitely fine being recorded in a showing. That is a public retail offering with someone's personal property all around and no implicit trust or knowledge of who is coming through. Just like you're in a store.

@Franklin Urbaezj For sure! As long as research gets done you'll be all good in whatever you choose I'm sure. Good luck!

@Franklin Urbaezj In this stage of the market a lot of people are looking further up stream for deals, and that's understandable, but I don't think sheriff and tax sales are a good start for a beginner at all, esp in PA... PA can be a difficult place to operate in terms of legalities. The process of buying encumbered property is fraught with ways to ruin you in your very first buy if you don't know exactly what you are doing. 

And be sure, wherever you choose, to take a close look at local property taxes. They can be astronomical in some places and constitute almost a second mortgage, making what looks like a deal quickly turn into a no-go. 

Not to discourage you from PA in general, but those are a few state-specific things to be aware of as you go along. Read all the horror stories and instead of letting them burst your bubble, ask for more and take them all as worst-case scenarios and be grateful you can learn from them and not live them. Check out the PA-specific forum here on BP, it's a good place to ask questions specific to the areas you're interested in. 

@Daryl Luc It's great you've got a family of lawyers because it sounds like you'll definitely need them. 

@Jessica Monroe This a good read to see how the issue might affect your re-sale down the road or issues you could face.

https://www.globest.com/sites/globest/2015/02/10/when-is-cleaning-up-a-dry-cleaner-worth-the-risk/