I bought and rehabbed a duplex a year and a half ago followed by another duplex and then a small single family home.
32k, 28k, and 6k purchase prices. Did all the work myself. Around 3-4k for rehab materials each.
They are cash flowing great.
Here are my issues:
I’m nearing the end of my private money source (Grandpa’s Trust Fund/Parents Heloc)
I want to continue expanding, but I now have had a full time job for 6 months (previously unemployed). I no longer have the time for doing renos myself.
I can qualify for a loan after I file taxes this year (said my local banker who wanted 2 yrs of taxes since I started)
For my current strategy to work I need money for more than the purchase price.
If I buy turn key properties I won’t be able to cash flow.
What are people’s suggestions.
Any good books I should read.
How do I start finding non-MLS deals to get lower prices.
How do I get started with hiring/contracting out work?
I get paid decently so I can afford to be in the red short term to fuel this, but unemployment and my current houses, plus a 2010 max out married IRA has/will wipe out savings.
I don’t really want to wait to build money, because now seems like the right time to buy and hold.
Start looking around to find a good handyman. For the properties you’re talking about, you don’t need a journeyman carpenter. When I first started here, I was given the number of a guy who was a licensed plumber and electrician. I’ve used him ever since and he’s done a ton of work for me. He’s done the majority of a few of our rehabs this year. The houses are still doing well, but money has run tight when we had 3 projects going on at once.
A lot of people say they don’t have the time for things when actually they do, but they don’t want to spend that much of their time working on houses. You probably have more time than you think. I rehab houses a few hours at a time due to my schedule and other obligations.
The people you hire will all be independent contractors for tax purposes (as long as they have other work besides just your places). You just have to find someone good at a good price and give them work. Talk to local banks and see if any of them are willing to take a chance on you since you’ve been doing this for a year and a half. Put all your financials in a binder and lay everything out on the table for them to see. That’s what we did and we developed a relationship with a local bank here that gave us purchase price and normally rehab funds too. It helped us grow fast like you’re talking about.
You’ve been doing this and found good properties at good prices. I wouldn’t worry much about reading too many books. You’ve got it already. Just keep current on here. From the books that I’ve read (especially after investing a little like you have), I find a couple worthwhile things in them but it takes reading the other 200 pages to find it.
All our properties have been listed on the MLS. I’ve never had to drive around searching or talk to individual sellers. We’ve used a Realtor for every transaction. Some people are against it, but if I can find cash-flowing properties on the MLS I’m not going searching elsewhere. I don’t have time for that.