All Forum Posts by: Aaron Linden

I think John Tiffany might be able to help you.

@Walter Roby jr To answer your question, you can find good 2% deals in the good ole US these days. About 8 months ago I bought a 3-2 near Notre Dame in South Bend and hit 2%, it has been  rented to a couple of good tenants for $1100/month for the past 5 months. I bought it for $40k put $12k into it, so I am all in for $52k. Based on my research, it would be pure chance to find a 2% deal in most major metro areas.

@Rob Snyder Congratulations in being able to save up that much money and have the wisdom to look into investing it! 

My first move would be to read all I could about investing in real estate and learn about analyzing a deal. Learn what the different factors that could make a deal good or bad (there are physical properties of the house as well as some more difficult to quantify properties) There are plenty of resources here on BP that will help you learn to do that as well as many books that will get you jump started (I would recommend starting with Millionaire Real Estate Investor). In parallel to learning, I think you should start driving neighborhoods and going to open houses. This would accomplish a couple of things namely you will meet realtors as well as getting to know what value looks like. You should also define how active you want to be in your investments. I think you should also go to some of the local REIA meetings to determine if it is a 'good' REIA and if it is, keep attending them to learn and meet new people.

I definitely like the idea of house hacking, if available, I would want to do it in a 3-4 unit building to really maximize your FHA loan especially since you have a good amount of money to start with!

@Stephen Sokolow I am surprised to hear 46614 is still king of the hill here in SB as I know 46617 (Notre Dame) area is absolutely on fire right now. To answer your question, the far south side seems to be a good place to raise a family and is a fairly easy commute to anywhere around with the bypass being right there. I can't think of too many other nice areas that are not immediately flanked by bad areas unless we start talking about Mishawaka or Granger. Furthermore, much of the development is on the south side (and off of 31) from my perspective. 

Downtown is definitely making a comeback as there is a ton of development planned for the area. As a result of this I would be cautious if I were investing in multifamily properties in the area as I would expect vacancies to go up significantly as there are over 1000 new apartments planned to begin construction in the next couple of years. I am not sure if there is that kind of demand for (quality) tenants in this area for apartments but maybe there is and I am missing it.

No matter how you slice it, I still think South Bend is making a turn for the better and offers some great opportunities thanks to the government and Notre Dame leadership. The most crucial steps they need to take from my perspective is cracking down on crime and clearing up some areas and investing in some decent schools.

In addition to HOLD, I would recommend "The ABCs of Real Estate Investing","The Advanced Guide to Real Estate Investing" both by Ken McElroy. As well as the "Millionaire Real Estate Investor" by Gary Keller.

I have a rental that is available near a college (typically students occupy this). I am wondering what people think of the value of 'smart upgrades'. Has anyone done any testing or research on doing some smart home upgrades such as a Nest thermostat, Amazon Echo, and smart LED lighting in a rental home? Does it cause a lot of problems? Did you find you were able to increase rent on the house/apartment? What was your payback period on the invested money?

Thanks in advance BP!

Aaron

Joshua D. Remember the appraisal and assessment are two different terms. The appraisal will be used to determine a fair sales value for the home through an appraiser. I would not put much stock in a bank appraisal. An assessment is done by the tax assessor for your county and is used to calculate taxes owed to the county. These two numbers do not need to be the same. When you purchase a property the assessed value should change to the purchase price where the appraised value would be whatever you could sell the property for. Having said this and with the caveat of not having the knowledge of taxes, fees, and insurance I think you should jump on this immediately as it sounds like a great deal! All the best to you.

@Russ Daniels The remaining tenant is qualified to on his own so there should be no problems paying the full amount. I just can't imagine he will want to stay, maybe I will be wrong though...

@David Leffel Thanks for the positive attitude, it really helps to hear the positive side of things when something like this happens. I very much appreciate your comment. I also agree, I am sure the laws have evolved to encourage the landlord to do the right thing in these situations.

@Bren Miller Yes it would be, however, I don't think that he wouldn't stay because of inability to afford the place. I imagine he won't stay because it would suck to live in the place where your best friend passed away. As mentioned above, he is fully qualified for this house on his own. 

Hello everyone,

Thank you so much for your advice on this situation. I apologize for the lack of followup as yesterday was crazy getting this all taken care of. 

Frankly speaking, I think that I should do unto others as I would have done to myself. I can not imagine wanting to sleep in the bedroom next to where my best friend passed away so I plan to let the room mate out of the lease without any penalty as this was a situation out of anyone's control. However, I will treat the security deposit as I would normally treat it. Any damages will be pulled from the deposit and until he leaves he is responsible for paying on time. I agree with @Jacob Pereira as well, I do not want to force someone to stay in my property against their will, nothing good can come of that. Especially, when these two gentlemen have treated my property with the utmost respect as everything is as good as new and perfectly clean right now.

Regardless, it turns out that either way this conversation is all conjecture because both of them signed on the same lease. I spent a good chunk of yesterday talking to a few landlord friends and a local lawyer and all have agreed that in the state of Indiana the lease is now null and void because the tenant passed away. As a result the other tenant is free to go regardless of what I say.

One way or another it is not good as finding a quality tenant in the dead of winter, in South Bend nonetheless, will be nearly impossible so this situation is set to cost me several thousand no matter what. Good thing I bought it right...

@Michael Herr Love that story! Thanks for sharing!

Michael Biggs just to update you unfortunately it turns out he did pass away in his sleep. Attempting to plan ahead here what would you guys recommend if the roommate wants out of the lease? As hard as it is I feel like I need to stick to my cancellation policy but I really feel for these people.