Took the leap and got lucky with crazy fast appreciation.

Real Estate Deal Analysis & Advice
5yFollow

Took the leap and got lucky with crazy fast appreciation.

Joseph Heinen
Rental Property Investor · Las Vegas, NV · Member since 2020 · 17 posts · 3 votes

Investment Info:

Single-family residence buy & hold investment in Las Vegas.

Purchase price: $355,000
Cash invested: $30,000

How did you add value to the deal?

LVP Floors across entire house and new paint.

1Reply
17 views

Most Popular Reply

Account Closed
Member since 2020 · 983 posts · 1k+ votes
5y

Post some of your numbers including your mortgage, property insurance, property tax, rental income, sewer use fees, trash removal, vacancy rate, cleaning between rentals, air conditioner repair, etc.. Las Vegas is so hot the air conditioners constantly break down. I am guessing your mortgage is about $1500 per month and with insurance, property taxes, trash removal and sewer use fees you will be paying about $2100 per month. I still have 2700 sq ft homes in Las Vegas where I'm collecting only $1800 per month for rent and my management company keeps telling me that is the maximum rent I can get.

Just today, I had a house in Las Vegas in escrow and when the buyer saw his inspection report he backed out of the purchase because the air conditioner motor was making a lot of noise, because the previous tenant's dog urinated on every baseboard in the house and there was bubbles in the wood molding. I didn't think anyone would notice the bubbles, but the inspector did. The water heater won't light and there are few more minor problems. Now, I have to go to las Vegas to replace every floor molding in the house and I will have to hire an HVAC contractor to repair the AC and hire a welder to repair or rebuild an iron gate and fence. My point is; I just paid $6,000 to clean, paint and carpet this house and I am guessing that if I had to hire contractors for the remaining work I will be spending an easy $4,000 to $5,000 making my total cost about $11,000. These scenarios have to be built into your projections and I think your cost of about $2100 per month is not so good a deal unless you get major appreciation.

When you rent homes in Las Vegas you need to make sure your tenants pay the sewer use fee and trash removal fees because the costs for those dig into your profits. If properties continue to appreciate, then you have have made a good purchase. But, the problem with Las Vegas is the rents are far too low and the cost to clean and paint between tenants eats up your profits Big Time. For every house I sold the cost to clean and make repairs was $6,000 to $12,000 and that was with doing the work myself with two of my employees.

1Reply
See this reply in the discussion

6 Replies

Jump to latestLatest
  • Account Closed
    Member since 2020 · 983 posts · 1k+ votes
    5y

    Post some of your numbers including your mortgage, property insurance, property tax, rental income, sewer use fees, trash removal, vacancy rate, cleaning between rentals, air conditioner repair, etc.. Las Vegas is so hot the air conditioners constantly break down. I am guessing your mortgage is about $1500 per month and with insurance, property taxes, trash removal and sewer use fees you will be paying about $2100 per month. I still have 2700 sq ft homes in Las Vegas where I'm collecting only $1800 per month for rent and my management company keeps telling me that is the maximum rent I can get.

    Just today, I had a house in Las Vegas in escrow and when the buyer saw his inspection report he backed out of the purchase because the air conditioner motor was making a lot of noise, because the previous tenant's dog urinated on every baseboard in the house and there was bubbles in the wood molding. I didn't think anyone would notice the bubbles, but the inspector did. The water heater won't light and there are few more minor problems. Now, I have to go to las Vegas to replace every floor molding in the house and I will have to hire an HVAC contractor to repair the AC and hire a welder to repair or rebuild an iron gate and fence. My point is; I just paid $6,000 to clean, paint and carpet this house and I am guessing that if I had to hire contractors for the remaining work I will be spending an easy $4,000 to $5,000 making my total cost about $11,000. These scenarios have to be built into your projections and I think your cost of about $2100 per month is not so good a deal unless you get major appreciation.

    When you rent homes in Las Vegas you need to make sure your tenants pay the sewer use fee and trash removal fees because the costs for those dig into your profits. If properties continue to appreciate, then you have have made a good purchase. But, the problem with Las Vegas is the rents are far too low and the cost to clean and paint between tenants eats up your profits Big Time. For every house I sold the cost to clean and make repairs was $6,000 to $12,000 and that was with doing the work myself with two of my employees.

    1Reply
  • Dave SpoonerPro Member
    Rental Property Investor · Cincinnati, OH · Member since 2020 · 869 posts · 823 votes
    5y

    @Joseph Heinen Congrats! Property looks great from the photo. Was this a househack? Are you currently renting it out or are you still living there?

    [email protected]
    0Reply
  • Joseph Heinen
    OP
    Rental Property Investor · Las Vegas, NV · Member since 2020 · 17 posts · 3 votes
    5y

    @Jack Orthman thanks for the input! Even though these are "low maintenance" yards, the houses still have a lot of costs associated with them

    0Reply
  • Joseph Heinen
    OP
    Rental Property Investor · Las Vegas, NV · Member since 2020 · 17 posts · 3 votes
    5y

    @Dave Spooner yup! This was a house hack. Was gonna house hack another primary residence but don't love the Vegas market. Thinking about snagging a STR withing the 4 hour range of Vegas

    0Reply
  • Dave SpoonerPro Member
    Rental Property Investor · Cincinnati, OH · Member since 2020 · 869 posts · 823 votes
    5y

    @Joseph Heinen That is great to hear, keep us posted! 

    [email protected]
    0Reply
  • Dmitriy Fomichenko
    Solo 401k Expert · Anaheim Hills, CA · Member since 2012 · 18k+ posts · 6k+ votes
    5y

    Wow, nice @Joseph Heinen ! 

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free