UPCLOSE & PERSONAL
ROOKIE INVESTOR
Searching for our next investment has led us to some interesting finds: (clockwise from left): c rumbling basement foundations, eccentric hardware choices, gorgeous historic windows, and wallpaper galore. See more of our investment finds by following @FixandFlipKC on Instagram!
“Rookie Investor” Abby Tillman and her husband Lucas.
One Renovation Complete: THE CONTINUATION OF OUR ROOKIE INVESTOR’S JOURNEY.
the world’s most beautiful couple, and in addition to that, they are clean and organized and responsive and they pay their rent on time with checks that al- ways clear. We feel very blessed to have them. However, we have had to deal with a few issues already. In the first month, the stove broke and we had to replace it. In the second month, we got a call from the alarm company saying the alarm had been deployed. Turns out it was just thun- der, which made such a loud noise it shook the windows and set off the de- tectors (cue eyeroll for overprotective alarm), but we still had to track down our renters and make sure everything was ok. We’re currently in month three, so who knows what could be next. I think, in some ways, we are still settling into our landlord role, so we don’t know truly how much extra work will be required of us to manage tenant issues. We don’t want to overextend ourselves, which makes us more hesi- tant about taking on another flip.
ably won’t get another property. No one ever said this journey would be easy. From the start, Lucas and I took on risk and manual labor and added stress, but we also reaped a huge sense of accomplishment, a solid investment, and knowledge we can use on our next project. We have obstacles ahead – you just read about a few. But we aren’t quit- ters. We keep dreaming about what life could look like if we could just secure a few more rentals. The flexibility it could afford our schedules, the stability it could add to our finances, and the joy we’d get from giving people beautiful places to live. This is what drives us. So, we won’t let a little exhaustion or fear or financing stand in our way. Like I’ve said before: Look out, Kansas City, we’re just getting started! •
FINANCING IS A NEWCHALLENGE:
by Abby Tillman
In our searching for the next invest- ment property, we found one house we really liked. It was in the perfect rental area and it was reasonably priced, with a big upside for an investor willing to do the renovation work. But, by the time we got to our showing (the first day it was on the market), it already had 3 offers, and we didn’t have financing in place. We now have two mortgages through a traditional bank, and we put a big chunk of our savings into the down payment on the rental (remember that if you’re buy- ing an investment property, you have to put 20% down for traditional financing). We need to explore alternative financ- ing options, and get it in place in order to be competitive in this market. That said, if I can just be honest, we’re a little scared by alternative financing. It’s just a world we don’t know very well, and so we haven’t done anything about it yet. This is definitely our biggest hurdle right now, and until we get it sorted, we prob-
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• How do you find renters? • How do you know how much to charge for rent?
our plates actually felt like a huge relief. My husband is a firefighter, so he had spent 8-10 hour days renovating that home in between his 24-hour shifts at the fire station. He was tired, and he was loving the break. To this point, even when we found a couple of deals that we might actually have liked, we were still too close to the last renovation for comfort. We’d look at all the painting that needed to be done and say “Nah. Not this property.” It will be interesting to see how this plays out in the long run. Maybe we’ll be more likely to hire out some of the labor associated with a renovation. Or maybe we’ll just need a few more months rest before we can tackle another project.
ast you heard from me, I was flying high—like, serious cloud- nine status. My husband Lucas and I had just finished flipping our very first investment property; we had our renters moved in (with rent checks clearing on time), and we had run the final num- bers on our renovation and found we came out $1,000 under budget. Huge success, my friends! Just an absolute huge success. Before we knew it, our friends were asking to grab dinner and hear the secrets to our success. They were all asking the same questions we had asked: • How do you find a good investment property? • How do you estimate the renovation costs? • Where do you go for financing?
We had answers for all of these questions and we felt pretty accomplished. In fact, our success had implanted a little addictive bug inside of us, and we immediately started out in the market again with our real estate agent, looking for our next property to flip. And then reality hit. WE HAD A LITTLE PTSD FROM OUR FIRST RENOVATION: Although our renovation went about as smoothly as possible, we found that we sort of liked having our evenings and weekends free again. We realized just howmuch time we had spent working at the rental and thinking about the rental. Having it off of
OUR LANDLORD DUTIES KICKED IN:
Abby Tillman chronicled her entire renovation journey at ThinkRealty.com. To read more, visit ThinkRealty.com/ RookieInvestor.
Don’t get me wrong here: we have amazing renters. They are probably
52 | think realty magazine july :: august 2017
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