Rental #1 Purchased Today

[Simon Ghandil]

Closed on it today, it's a 2 bed 1 bath in Portsmouth, VA. Purchased it for $30,000, after closing costs it was $31,650.15.

Planning on placing a tenant buyer in there for $975 a month. Taxes and insurance will set me back $200 a month, and that is my only expense. 

I don't do traditional rentals, I plan on doing a rent to own lease option with all of my properties, that way I can purchase low end properties with no major repairs needed so my tenant buyer fixes the house up and I don't worry about maintenance. I am closing on another one this week, and hopefully 2 more next month. 

I'm very happy with this purchase since a lot of our homes aren't in as good of condition as this property. The big backyard and garage is a very nice addition. 

My goal is to purchase at least 1-2 every month. This property was purchased with cash, upcoming properties will be a mix of cash and private money. If private money is used, the house will be paid off after 5 years at a 12% annualized interest rate. 

Pictures - https://drive.google.com/open?id=0B4gRIJkesW-HLVlz...

[Linda S.]

Congratulations on  LEGAL SLUM LORDING!

First-- let me say, I get it-- there is a need and demand in the market, or else your mentor wouldn't be in business.    You said @@Simon Ghandil,   " If I decided to strictly rent them out (which I would never do) I would spend thousands to rehab the interior, moving someone in and then worry about my phone ringing in the middle of the night because the pipes burst."--- this is so predatory  IMO.   Do you think those low income people, with no credit, and struggling to pay the bills, can pay the thousands to get it fixed?   Your houses will continue to deteriorate, and you'll just find the next sucker, b/c I get it-- there's a market, there's a lot of demand from the desperate people who no one else will rent to.      This is what a slum lord is-- no heat?   roaches?   pipe burst?- it's not the slum lords problem legally. 

I feel bad for your tenants..  they don't get the benefits of home ownership (Inspections first so they know the costs... itemizing, mortgage taxes), and they don't get the power of renting (no maintenance)...   Do you think they can get financing from a bank when it's over.. nope, it won't pass inspection!  But again-- not your problem legally.      

I feel bad for the newbies here who are thinking "Wow!  what a return!"  "He found a great new way of investing!"   It's legal slum lording, that's all it is!  I guess if you can handle it ethically, there's a market and yes, there is a lot of money to make with the most desperate people!   I'm sure you're doing everything right legally, it sounds like everything is buttoned up.. but just be upfront with what you are doing, especially with newbies and easily influenced people.    Companies like Vision Property are getting sued left/right, and they are in the news often about  preying on consumers.

Good luck,  but just be upfront with what you're doing.