Small Balance Commercial Loans Now Available from REI Capital Resources and Current Offerings

As a direct lender and financial intermediary, we have the opportunity to place the most competitive financing options in the market.  We look forward to winning your business and creating a long-term relationship.  In addition to our core offerings of Ground-Up New Construction ($200K to $45M – Loan Amount), Fix/Flip Projects, Long-term Rental Property Acquisitions and Refinances, Airbnb or vacation rental acquisition and refinancing, and Commercial Property Lending including Apartments, we now have the ability to place loans with multiple small-balance commercial lenders.  The small-balance commercial loan amount falls between $100,000 to $10.M.

Types of properties that can be funded: 

  • Multifamily 
  • Commercial Condo 
  • Multi-Use – Primarily Residential 
  • Multi-Use – Primarily Commercial 
  • Office 
  • Retail/Wholesale/Strip Center 
  • Warehouse 
  • Light Industrial 
  • Self Storage 
  • Mobile Home Park 
  • Automotive 
  • Day Care – Free Standing/non-residential 
  • Restaurant/Bar 

Loan Programs Available: 

  • No Doc (min FICO 700)  –  $100,000 to $2.5M 
  • Full Doc (Min FICO 600) –  $500,000 to $10.0M 
  • Lite doc (Min FICO 650)  –  $100,000 to $2.5M 
  • Bank Statement (Min FICO 650) – $100,000 to $2.5M 

Loan Terms: 

  • Amortization – 15, 25, 30 yr 
  • Term – 5, 7, 10yr 
  • Rates – from 5.5% 

Here are more details of our core lending products of Ground-Up New Construction ($200K to $45M – Loan Amount), Fix/Flip Projects, Long-term Rental Property Acquisitions and Refinances, Airbnb or vacation rental acquisition and refinancing, and Commercial Property Lending including Apartments.

  • 1. Fix and Flip Loans – up to 90% Of Purchase with 100% of Rehab, experienced, or first-timer investors
  • 2. BRRRR – Buy, Rehab, Rent, Refinance and Repeat loans are available.  Loan programs include 5/1 ARM, 7/1 ARM, 30 Year Fixed Rates.
  • 3. Rental Property Loans – Purchase – Refi – Cash Out.  SFR 1-4 units and AirBnB properties.  Loan programs include 5/1 ARM, 7/1 ARM, 30 Year Fixed Rates.
  • 4. Ground Up Construction Loans
  • 5. Portfolio Loans for SFR – 2-4 units and Multi-Family
  • 6. Bridge Loans – Loans to Pay off current Lender – 1-2 Year Loans.
  • 7. Multi-Family Loans from 5 doors to 300+ doors.  Value-Add Purchase, Turn-Key Purchase, Bridge, New Construction, Agency and non-Agency loans
  • 8. Commercial and Mixed-Use Properties
  • 9. Haz. Ins. Co you can use. https://affiliate.nreig.com/RichardTurner­

Do you need funding for your BRRRR investment?  Basically, the loans look like this:

  • LTV – up to 88% of Cost / 68% LT Market Value
  • DSCR – 1.20 based on Market Rents (1.30 if less than 3yrs rental experience)
  • Experience – Min 5 flips or rental / 5yr look back
  • Loan Terms  – 7 yr  (5yr Fixed+2yr Floating)
  • Interest – Intro Rate 4.9% (increases with credit below 740, max 5.8%), First-year – no interest payments (rolled into loan principal)
  • Loan Terms – 12yr (10yr Fixed + 2 yr Floating)
  • Interest- Intro Rate 5.2% (increases with credit below 740, max 6.1%), First-year – no interest payments (rolled into loan principal)
  • Origination Points – 3% (2 to lender + 1 to us)  need to get a Broker/Client Agreement at 1%
  • Prepayment – Step Down 3-2-1  (No PPP if Origination Points Increased by 1%)

Some of our lenders will work with the following background issues:

  • Litigation with another Lender
  • Bankruptcy (10yr lookback)
  • Foreclosures (since 2012)
  • Delinquency with suppliers
  • Outstanding RE Liens
  • RE Loan Delinquency

Our lenders are ready to work with contractors and investors.  Now is a good time to buy a distressed property but be aware of the risks and understand what you’re getting into.  Distressed homes offer a unique buying opportunity for real estate investors, but the average home buyer should probably look elsewhere.

If you need funding, apply now. I am working online with the rest of you.  

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http://www.reicapital.cash/

Patrick St. Cin

W – 512-213-2271

Don’t Self-Sabotage as a Real Estate Investor, Rates are RISING!

Rates are heading up rapidly! Since 9/1/2021 when the best 30yr fully amortized loan interest rate was 3.625%, there has been a steady increase.  Within the past 7 days, the same institutional lender has increased its rates to 5.750%, the lowest possible rate available.  This is a 2.125% increase in approximately 6 months.  Interest rates will remain volatile during this period of inflation.  As the Fed works to rein in inflation by adjusting the rate upward, we will continue to see these increases.

What can be done to mitigate these increases?

Photo by Samson Katt on Pexels.com

When your Loan Officer requests Documents please be expeditious in sending them.  We are seeing investors delay signatures, sending documents, and poor response times which have led to as much as a 1.00% to 1.25% increase in the interest rates.  Investors want to see the mailbox money flow in with a minimum of effort, that is understandable.  But when it comes time to purchase or refinance a property, please make sure that your entity documents are in order.  This means signatures are where they should be (the biggest issue we see today), That a clear chain of ownership of the entity is evident.  Lawyers like to hide the ownership trail to minimize exposure to risks.  Lending institutions want to know exactly who they are lending to, minimal smoke and mirrors make the organizations with the money happy.

Some lenders offer a rate buy-down.  The basic way this works is that by paying an increase in the origination points to the lender the interest rate can be lowered.  Generally, this is a ratio of points to interest buy-down.  An example could be:

The ratio is 0.333% per Point.  The maximum buydown is 2 points or 2 times the buy-down points offered.

Interest7.00%7.00%7.00%
Origination Pts0%1%2%
Buy Down0.000%0.333%0.667%
New Interest Rate7.000%6.667%6.334%

There are other lenders that offer a similar buy down at a rate of 0.5% maximum for an increase in the lender’s origination points of 1.5%.  This buy down can be bought in 0.125% increments if that works for your program.

BUT WAIT THERE IS MORE!

We do have better news if you are doing a BRR strategy and not just a regular refinance and are open to a 5 or 7 year ARM. Call us today to find out more about all our options.

If you need funding, apply now.   

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http://www.reicapital.cash/

Patrick St. Cin

W – 512-213-2271

Updates to our Loan Offerings – More for you as a Real Estate Investor

We are a direct lender and financial intermediary, which gives us the opportunity to place the most competitive financing options in the market.  Below is what we specialize in.  We look forward to winning your business and creating a long-term relationship: Ground-Up New Construction ($200K to $45M – Loan Amount), Fix/Flip Projects, Long-term Rental Property Acquisitions and Refinances, Airbnb or vacation rental acquisition and refinancing, and Commercial Property Lending including Apartments. Here are more details of our core lending products.

1. Fix and Flip Loans – up to 90% Of Purchase with 100% of Rehab, experienced, or first-timer investors

2. BRRRR – Buy, Rehab, Rent, Refinance and Repeat loans are available.  Loan programs include 5/1 ARM, 7/1 ARM, 30 Year Fixed Rates.

3. Rental Property Loans – Purchase – Refi – Cash Out.  SFR 1-4 units and AirBnB properties.  Loan programs include 5/1 ARM, 7/1 ARM, 30 Year Fixed Rates.

4. Ground Up Construction Loans

5. Portfolio Loans for SFR – 2-4 units and Multi-Family

6. Bridge Loans – Loans to Pay off current Lender – 1-2 Year Loans.

7. Multi-Family Loans from 5 doors to 300+ doors.  Value-Add Purchase, Turn-Key Purchase, Bridge, New Construction, Agency and non-Agency loans

8. Commercial and Mixed-Use Properties

9. Haz. Ins. Co you can use. https://affiliate.nreig.com/RichardTurner­

We are also very excited to be working with a new lender that will provide funding for the BRRRR investment concept.  Basically, the loans look like this:

  • LTV – up to 88% of Cost / 68% LT Market Value
  • DSCR – 1.20 based on Market Rents (1.30 if less than 3yrs rental experience)
  • Experience – Min 5 flips or rental / 5yr look back
  • Loan Terms  – 7 yr  (5yr Fixed+2yr Floating)
  • Interest – Intro Rate 4.9% (increases with credit below 740, max 5.8%), First-year – no interest payments (rolled into loan principal)
  • Loan Terms – 12yr (10yr Fixed + 2 yr Floating)
  • Interest- Intro Rate 5.2% (increases with credit below 740, max 6.1%), First-year – no interest payments (rolled into loan principal)
  • Origination Points – 3% (2 to lender + 1 to us)  need to get a Broker/Client Agreement at 1%
  • Prepayment – Step Down 3-2-1  (No PPP if Origination Points Increased by 1%)

The lender will work with the following background issues:

  • Litigation with another Lender
  • Bankruptcy (10yr lookback)
  • Foreclosures (since 2012)
  • Delinquency with suppliers
  • Outstanding RE Liens
  • RE Loan Delinquency

This lender is geared up to work with contractors and investors.  They understand the issues they come into and have a system that helps to prevent further erosion of the borrower’s track record or credit.

One of their claims is that 95% of applications pass thru the system to get a loan.

If you’re planning to buy a distressed property, now may be a good time to buy. Just make sure you’re aware of the risks and understand what you’re getting into.  Distressed homes offer a unique buying opportunity for real investors, but the average home buyer should probably look elsewhere. 

If you need funding, apply now. I am working online with the rest of you.  

This image has an empty alt attribute; its file name is apply-now-button.gif

http://www.reicapital.cash/

Patrick St. Cin

W – 512-213-2271

Photo by Andrea Piacquadio on Pexels.com

10 Real Estate Investor Blogs You Should Be Reading in 2021 and 2022

10 Real Estate Investor Blogs You Should Be Reading in 2021 and 2022

Whether you’re a seasoned investor or are just acquiring your first property, real estate investment blogs are an excellent source of information. From rental properties to fix-and-flips to REITs, there’s a blog — and usually a partner podcast — that will give you the scoop on all things real estate investing. 

There’s a universe of knowledge about real estate out there, and just being willing to seek it out can accelerate your expertise far beyond your years of experience. The best place to start is the internet’s most prominent real estate investor blogs. What we are reading at REI Capital Resources and recommend you do too!  Take a look at our top 10 picks for blogs to follow:

1. Afford Anything

Blogger: Paula Pant

Focus: Rental properties

A former journalist, Paula Pant achieved financial freedom through real estate, and now she teaches others how to do it through her blog and podcast. Her philosophy? You can afford anything, but not everything, so you’ll need to take control of your money to build the life you want most. Whether you read her blog or listen to the podcast, you’ll get great advice on how to set a course toward financial freedom with real estate investing.

2. JoeFairless.com

Blogger: Joe Fairless

Focus: Multifamily investing, apartment syndication

Joe Fairless is a bit of a Renaissance man — he’s taught preschool, done standup, and worked as an ad exec. He also controls more than $900 million in real estate. So if you’re an investor looking to up your game, you’ll want to read Joe’s blog and his long-running daily podcast, “Best Ever Show.” 

3. Mr. Money Mustache

Blogger: Peter Adeney

Focus: Real estate investing for beginners, rentals, and REITs

“Financial freedom through badassity” is the tagline of Peter Adeney’s blog, so right away you know you’re in for a no-holds barred perspective on real estate investing. Adeney was able to retire in his 30s by cutting expenses in half and investing the savings in Vanguard index funds and rental homes. His blog is great for beginners, as many of the posts offer great advice on how to stash away more money by slashing food bill costs and other lifestyle expenses.

4. InvestFourMore.com

Blogger: Mark Ferguson

Focus: Real estate investing, wholesaling, BRRRR strategy

Mark Ferguson built $3.7 million in equity through real estate investing. He’s got info for everyone, from advanced investors to those who are just getting their feet wet. Ferguson blogs and has a regular e-newsletter that discusses flipping houses, financing, finding deals, wholesaling, and BRRR strategy.

5. Bigger Pockets

Focus: All aspects of real estate investing and personal finance

BiggerPockets is the single largest real estate investing platform in the world.  

BP is an empire of knowledge that spans podcasts, a growing library of books, and a vast website with all the information and resources an investor could want. Half educational, half social network, it brings together both new and experienced investors in all phases of real estate.

6. REtipster

Seth Williams is the founder of REtipster, a real estate investing blog that talks a lot about investing in raw land and some pretty cool land-investing strategies. I’ve always enjoyed talking with Seth at conferences, and he is a knowledgeable and transparent investor.  Seth’s website is easy to navigate and very user-friendly. He talks about more than just investing in land on his platform, so don’t write off this awesome resource just because you don’t buy land (yet).

7. Short Term Sage

Julian Sage of Short Term Sage is the short-term rental (STR) guy. I have had the pleasure of knowing Julian for a couple of years now, and he is in a mastermind group we host for service members. Julian is on active duty in the Coast Guard and has become an expert in the short-term rental space, hosting not one, but two, of the top short-term rental podcasts on iTunes.

Not only does Julian talk about traditional short-term rental strategies, but he also talks about rental arbitrage, STR property management, and even multifamily STR opportunities with apartment buildings.

8. Inman

Inman is a leading source of real estate information used by investors, realtors, brokers, and other professionals. It’s often one of the first sites to post major stories that affect the housing market. Frequent visitors will find news about:

  • The most recent mortgage rates
  • Statistics such as mortgage delinquency rates
  • New tools and tech platforms for real estate searches and transactions
  • Real estate firm mergers
  • Real estate crime and legislation

While the site focuses on the latest news, that isn’t the only kind of content you’ll find here. A decent amount of the content covers tips, secrets, and industry advice.  Inman is for real estate investors who rely on up-to-date information about the industry. That may include large-scale investors who are looking to break into local markets. Most of the advice is meant for people who are actively investing in property rather than new investors.

9. Realty Times

Realty Times is a real estate news and advice site that serves both investors and homebuyers with stories about: 

  • The definitions of critical real estate terms
  • Legal challenges and new legislation
  • Changes in consumer behavior and trends
  • Shifts in the housing market
  • Home selling advice

It regularly publishes market outlook reports for specific housing markets. These reports are detailed with information about average home prices, the best time to sell, and other data. Anyone who can make use of the reports can benefit from this blog. It’s a good resource for both buyers and sellers. If you’re going to focus on selling, what you learn here may help you understand buyers’ mindsets better. 

10. Commercial Property Executive

Activity in the commercial real estate market matters, even if your focus is residential real estate. That’s because the local job market and economy have a dramatic effect on the performance of residential rental properties.

Start learning from the best

Your education as a real estate investor never stops — especially if you want to keep growing your holdings. Blogs and podcasts are a great way to hear what’s working/not working for other investors. Find a few you like and commit to reading them to get new ideas and fresh perspectives for your real estate investing business. Reading blogs is one way that you can significantly increase your expertise with only a little effort. Use your downtime to do some reading, and you may be able to catch up on years of experience.  All of us at REI Capital Resources recommend checking out each of these blogs to find out which one can offer you the most. 

Photo by Pixabay on Pexels.com

If you’re planning to buy a distressed property, now may be a good time to buy. Just make sure you’re aware of the risks and understand what you’re getting into.  Distressed homes offer a unique buying opportunity for real investors, but the average home buyer should probably look elsewhere. 

If you need funding, apply now. I am working online with the rest of you.  

Patrick St. Cin

W – 512-213-2271

Patrick@REICapitalResources.com

http://www.reicapital.cash/

ANNOUNCING: Bridge FICO Bands Lowered to 600+ Minimum Requirement

Photo by Amina Filkins on Pexels.com

We’re constantly analyzing data to train our machine learning models and inform our credit policies. Recently, we’ve lowered our bridge FICO minimum requirement to 600+ for qualifying clients. With newly expanded FICO bands, you have the potential to approve different clients and scale your business. Please note that all terms and borrowers are subject to credit approval.
We’ve also increased our bridge rehab limit to $500k maximum for clients of all REI experience levels. Take advantage of our other bridge loan program highlights, such as:

  • Rates as low as 6.5%*
  • Minimum 600+ FICO – new
  • Max $500k rehab size with up to 100% of rehab costs covered – new
  • Loans from $50k to $3MM
  • 12, 18 & 24-month terms
  • Up to 90% of the purchase price
  • Up to 75% of after-repair value

If you’re planning to buy a distressed property, now may be a good time to buy. Just make sure you’re aware of the risks and understand what you’re getting into.  Distressed homes offer a unique buying opportunity for real investors, but the average home buyer should probably look elsewhere. 

If you need funding, apply now. I am working online with the rest of you.  

Patrick St. Cin

W – 512-213-2271

Patrick@REICapitalResources.com

http://www.reicapital.cash/

Rental Concessions

Landlords should not bear all the risk of another government shutdown, but tenants are being more aggressive about demanding pandemic language in new leases, this according to reporter Esther Fung’s article, Retail Landlords Offer Pandemic Clauses in New Leases, August 25, 2020 in WSJ.com.

Covid-19 is persisting in many parts of the country and it is hard to tell what will happen now that schools begin to open and fall and winter approach. When the government ordered nonessential businesses to shut down due to the Covid-19 pandemic, many households lost their income and businesses lost their sales. Rents became hard to pay whether you were paying rent for your home or paying rent for your retail shop or office.

Photo by Gustavo Fring on Pexels.com

Previous force majeure language in lease contracts did not specifically mention “government mandated shutdowns in response to a global pandemic” under what was categorized as an “Act of God.”  Force majeure language in lease paperwork allows tenants to terminate leases or reduce rent in extraordinary circumstances.  However, the WSJ article cited above by Fung points out that “force majeure language in a lease hurts owners’ ability to get financing for the property.”

Landlords of both multifamily units and retail units have had to offer concessions to retain tenants and attract new ones. Philippe Lanier a principal for a property developer managing retail properties in Washington DC told Fung, that as a landlord, “You have to provide the tenant an easy decision. If you make it complicated, you’re not going to get this done.” Philippe Lanier, EastBanc

Percentage Concessions and Shorter Leases

What is a simple concession in a lease agreement? Lanier offered to cut the base rent by 50% if retail stores are forbidden to operate their businesses and this same concession could apply to an apartment tenant loses their job in a mandatory shut down. In Lanier’s agreement, the difference would be repaid in 6 equal installments that begin on the first day a business can reopen, or a tenant returns to work.

In Detroit, Bedrock, offered to waive base rents in return for 7% of gross sales for eligible tenants, which include restaurants and retailers. (WSJ.com) This company was also allowing the use of security deposits for other purposes.

Some investors are signing leases with shorter terms and that are more revocable by either party.

Photo by Bich Tran on Pexels.com

With rents taking a hit in large cities across the country it is hard to tell how long it will take an investor to make a profit on a rental property. Location still seems to matter, but the location may be in smaller towns and the suburbs near large cities rather than in the large metropolitan areas themselves.

Clear, simple language in a lease is best but the concessions themselves can be as creative as you are.

If you need funding, apply now. I am working online with the rest of you.

Patrick St. Cin

W – 512-213-2271

M – 505-239-3026

Patrick@REICapital.cash

http://www.reicapital.cash/

Transform an Office Building into a Home

Many people are transforming rooms in their homes into home offices, but some people are transforming commercial spaces into homes.

Unused and Vacant

Today, CNN reports that outdoor retailer REI is selling their newly finished unused 8-acre corporate campus in Bellevue, WA as they redefine their experience of “headquarters.” Their new model they say will make remote working the “normalized model” for headquarters employees and the future headquarters building will be instead multiple satellite campuses in the Seattle area.

Businesses all over the US are seeing what REI is seeing and adjusting their business models. Office building occupancies are going down in the downtown areas of large cities across the US primarily because of the effect of the coronavirus pandemic and its associated lockdowns. Businesses are either moving, transitioning to remote working, or closing altogether. Landlords of downtown office buildings in big cities are in danger of losing the income from their properties as companies move to small communities or have their staff work from home. If the landlord has a mortgage and cannot keep up with their payments, they could lose the building. These buildings are then left vacant.

According to STR, a global hospitality data and analytics firm, hotels are suffering as well. Their data show that a fifth of hotel properties are still closed and have been since March. Many of these hotels will not survive the pandemic.

This devastating business and economic situation may offer a sliver of optimism if we look at investing in converting office buildings and hotels into much needed housing.  

According to an article in realtor.com (https://www.realtor.com/news/trends/office-hotel-conversions-to-housing/) office buildings and hotels in urban downtowns are attractive for conversions to apartment housing because they have wifi and cable infrastructure in place, parking areas, and common areas. While offices will require more plumbing to provide bathrooms and perhaps kitchens to each apartment, hotels can be converted less expensively because they are already divided into individual spaces with individual bathrooms.

Creating Affordable Housing

One example of a hotel converted to apartments is Plato’s Cave at 3524 Keetor St. in Branson Missouri. Repvblik (pronounced Republic) LLC, a Los Angeles based firm, converted a vacant six-building Days Inn into multi-family or workforce housing. The complex includes studio apartments, renting for $495.00 a month, and one-bedroom apartments, renting for $695.00 a month. According to its website, https://www.platos-cave.com/pictures-of-units, the complex incudes a gym, commercial kitchen, large dining area, an outdoor pool and beach volleyball on the property. There is plenty of parking and it is right on the strip within walking distance to the jobs there. It is affordable housing that is so badly needed.

Living and working in crowded downtowns were very popular until the pandemic hit these communities so hard. It is not clear how many people will be willing to move back to crowded downtowns after the pandemic ends or if it lingers for years. It looks certain that there will be many vacant office buildings and hotels around by the end of 2021 or when long-term leases run out. Landlords will have to keep their prices in line with demand and it is too soon to tell what demand will be.

Too Early to Give Up

Clare Trapasso, the author of the article, “As the Pandemic Empties Office Buildings, Can Those Spaces Help Solve the Housing Crisis” says, “… it may be too early to write the obituary of urban office buildings and hotels, as many did in the wake of 9/11.”

However, development can drive what happens, so you might want to be thinking about a strategy to help cities, people in need of housing, and your own financial security by seriously studying the risks and rewards of converting vacant downtown office space and hotel space into affordable housing in your own city.

If you need funding, apply now. I am working online with the rest of you.

Patrick St. Cin

W – 512-213-2271

M – 505-239-3026

Patrick@REICapital.cash

http://www.reicapital.cash/

References

Trapasso, Clare, Realtor,com, As the Pandemic Empties Office Buildings, Can Those Spaces Help Solve the Housing Crisis, August 12, 2020. com (https://www.realtor.com/news/trends/office-hotel-conversions-to-housing/)

CNN,  Leah Asmelash and Alison Kosik, August 13, 2020. https://www.msn.com/en-us/news/us/outdoor-retailer-rei-to-sell-sprawling-new-and-unused-headquarters-to-shift-to-remote-work/ar-BB17VDuG?ocid=msedgdhp

Platos Cave website: https://www.platos-cave.com/property-tour

Picture of downtown, USEPA Environmental-Protection-Agency / Public domain

Multi-Family 2020

Investing in, constructing, renting, and remodeling healthy multi-family living environments is still important and even more important now that the coronavirus has rubbed our faces in the dangers of living and working close to other people. Since more land has not materialized in most cities to give us more room to live on and in, builders and investors need to be creative about how to design or redesign compressed housing that will prevent and control the spread of an infection that is viable in air and on surfaces. People are and will be looking for homes that keep them safe from infection.

The Problem of Close Quarters

The necessity of elevators and lobbies, as well as the cost of swimming pools and on-site gyms they pay for but cannot use are scaring renters away from large apartment complexes. These are the places where dwellers must maneuver around each other in tight spaces, share air for minutes at a time, and touch buttons and handles others touched just moments ago.

Photo by San Fermin Pamplona on Pexels.com

Consider in Your Budget Some New Things

To update your multi-family housing project in this time of coronavirus spread, include in your remodeling budget something new, such as, touchless and voice technologies that can improve the safety of getting into or out of a home without touching contaminated surfaces, new air handling technologies that vent air to the outside and clean air within an elevator or other room after each use.

If your project has many units on multiple stories, you may need to consider some robotic or AI technology that will keep the number of occupants in an elevator down to one at a time. Perhaps the elevator itself could be modified into a capsule that only holds one person at a time, a capsule that could be disinfected and dried automatically between uses. Ah that will be expensive. Some complexes would require numerous elevator capsules.

Photo by Miguel u00c1. Padriu00f1u00e1n on Pexels.com

It looks like fighting the virus will not be energy efficient. Supplying cleaner air includes containing contaminated air or exhausting it to the outdoors, diluting the virus in the air by injecting clean and filtered outdoor air, and cleaning the air within a room. Any of exchange of air with the outside will make temperature control more difficult and less energy efficient. Thus, to make your multi-family housing as safe as possible, you will likely need to install larger electrical capacity.

Smaller Price Tag for Separate Entrances

If a large complex seems to come with a price tag that is too high, there are smaller multi-family investment projects that have designs that handle the problem of indoor common areas by doing away with them. Small apartment buildings, duplexes, and joined houses work well as rental investments. They include individual entryways and even small yards or gardens.

Small units of 2 to 5 homes can easily be designed with individual outdoor entries that meet social distancing requirements. In one design I recently studied online at http://www.houseplans.com, the complex included 5 units. Each house was three stories, but the overall complex was only one housing unit tall. All homes included a ground-floor separate entrance. Those that had garages had two entrances counting the front door and an entrance from the garage.

Although this design might not be great for seniors because of the stairways, I found it a manageable complex size that allowed each home to be independent. Each unit in this design is roughly 1170 sq. feet with 2 beds, 2 baths, 3 floors, 1 garage, 3 levels, and separate outdoor entries. The garage and second bedroom or home office were on lower level. The living room, dining room, and kitchen with washer and dryer and utility room were on the second floor. The master bedroom, bath, walk-in closet and roof-top deck were on the third story. Five printed sets of plans cost $950.00.

If you need funding for your project, apply now. I am working online with the rest of you.

This image has an empty alt attribute; its file name is apply-now-button.gif

Patrick St. Cin

W – 512-213-2271

Patrick@REICapital.cash

http://www.reicapital.cash/

References

https://www.houseplans.com/plan/5850-square-feet-2-bedrooms-2-bathroom-luxury-home-plans-1-garage-33631

Migration Boom

People are moving. Single-family houses in the suburbs are opportunities real estate investors should consider.

According to an article in Mansion Global, apartment living in densely populated urban areas is already losing its appeal to Americans as they process their experiences during the coronavirus pandemic. Many people are eyeing options for relocating to the suburbs and a single-family home after facing the challenges of coming into contact with infected individuals in apartment building common areas and restrictions on their use of outdoor spaces like pools and game rooms.

Buyers crave —ROOM— living space, outdoor space, privacy, flexibility, and safety.

When you are researching a purchase of a rental property, evaluate:

  1. Is there room for an office in the house?
  2. Does the house have a good-sized yard?
  3. Is there a pool in the backyard?
  4. Is there a deck or porch that offers a sheltered option to living indoors?
  5. Is the neighborhood safe to walk around in at night?
  6. Is there a neighborhood association and is it restrictive?
  7. Did local authorities try to restrict people’s use of their yard during the pandemic?
  8. Consider taxes. People are richer in states where taxes are lower.
  9. Big or tiny, single family homes in suburbs near major cities offer good opportunities for people to escape living in densely populated apartment buildings where entrances and recreation space is shared and access is restricted. If you need funding, apply now. I am working online with the rest of you.

Patrick St.Cin

W – 512-213-2271

M – 505-239-3026

Patrick@REICapital.cash

http://www.reicapital.cash/

graphic:tsca / CC BY-SA (http://creativecommons.org/licenses/by-sa/3.0/)

Investing in Apartments – Commitment and Study

Even in the coronavirus pandemic crisis investing in rental apartment property can still be a good way to add thousands of dollars to your income in the long term. If you buy apartment real estate that is in a good location with growth potential, but that is not too expensive, this real estate investment will likely recover after the crisis passes according to (Brad Hunter, Forbes.com). However, the investment takes funds and commitment over the long haul.

Appreciation

There are two way to make money from rental real estate. The first, appreciation, is a rise in value over time. This profit can only be realized by reselling the property after some time has passed or after you have made upgrades that add to the value. Generally, real estate appreciates in value over time if you are in the right location. Be sure to study employment and home buying trends in your local area before purchasing rental property.

Cash Flow & Coronavirus

You can also make money in the form of cash flow by collecting rents as income. The coronavirus pandemic is affecting the apartment rental real estate industry because many people, more people than we have ever seen before, have lost their income in only a few weeks, unemployment claims are up all over America, and tenants may not be able to pay their rents for the next couple of months. This will impact the ability of landlords to make money. Either the landlord forgives the rent and eats the loss for a while to keep the tenant, or the renter is evicted, and the property becomes vacant. In either case, the landlord is not receiving income on the property and may have to seek forbearance from their own lenders.

If a landlord has paid off his or her own mortgage on the property or if he or she has established an emergency fund as Dave Ramsey suggest (daveramsey.com), they will be able to weather the storm caused by the jobs lost in the pandemic shutdown.

Jobs and Renting

Either the jobs come back after the danger from the virus is past and businesses reopen, and the renters stay, or a new set of renters materialize because those people who are no longer able to afford their own homes move to apartments and construction of new homes slows because of coronavirus-driven delays caused by labor shortages, and supply shortages. More people may need to rent. In this case. It is likely the landlord’s income will return after some shaky months.

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Asset Rebound

Because the income potential should rebound, rental apartment property should not lose its value overtime as an asset. If the building itself remains sound, there is no reason why the property value will not increase as other investments tank and real estate once again looks solid and reliable compared to stocks. Also, if interest rates remain low, investors will be willing to take on more debt and are not restrained from purchasing property at higher prices. This will help investors who plan to sell their rental properties make a profit.

Single-Family Rentals

Investments in single-family rental homes may also benefit in the long run as more people work from home and need more room than apartments afford. Brad Hunter also suggests in his article on Forbes.com that the single-family-built-to rent-industry may benefit as people need that specially designed home office space with its own door and bathroom.

Due Diligence

Investment in rental real estate should remain attractive but be sure to do your due diligence.

Study everything from location, jobs, virus hotspots, distancing trends, supply chains, virus rebounds as they occur, and what the kids are doing now.

References:

Dave Ramsey online at https://www.daveramsey.com/blog/how-to-invest-in-real-estate

Forbes online: https://www.forbes.com/sites/bradhunter/2020/03/24/coronavirus-impacts-on-real-estate–why-you-need-to-think-short-term-and-longer-term/#6f2133345f6f

Investopedia, The Impact of Interest Rates Changes by the Federal Reserve. https://www.investopedia.com/articles/investing/010616/impact-fed-interest-rate-hike.asp

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Patrick St.Cin

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