All Forum Posts by: Alecia Loveless

@Ritha Belizaire I think the best thing to do is to just go for it. If I was in your situation I would wait until I was settled in after maternity leave and get started.

My personal opinion is that if you can swing it financially I’d go for a small multi 2-4 units close to where you live for economies of scale and ease of convenience. I’ve just bought a 4 unit about 30 minutes away from my house and fortunately it’s self sufficient and the tenants are currently not needy because the drive is worse than I thought multiple times a week.

It’s easier to deal with lawn care, snow removal, trash, etc in one location with multiple tenants as opposed to multiple locations.

Four rent checks as opposed to one is much nicer. For now my apartments are above average quality and attract tenants who stay long term. This might not be a possibility in your market but even 2-3 years is win when it comes to turnovers.

And the cash flow at $1000 is nicer than my single family was around $300.

I’d join the local or state real estate association or both and try to network through some of their virtual meetings.

@Haven Ousley I would be looking for something with larger cash flow for 4 units personally.

Also my multis all have some form of common area electricity at night although I’ve seen buildings that didn’t, and I always have some sort of Other expenses, snow plowing, lawn maintenance, needing to buy a ladder or tool, etc.

I see that you have factored in for the property management fee 12% but this doesn’t actually usually factor in any work. Unless your management company is different. So the first time the electrician is called out, I just got an estimate tonight for a light that flickers, $281, the property management company will send you a bill for $350. Now you are out 3.5 months of cash flow at $88 a month.

I’m not trying to discourage you. I think you’re on the right track! I just think there’s lots of things I wish people had pointed out to me when I’d started.

I did see your rent estimate increased in the following years. If this property is in your price range and you’ve looked at a lot of them and done a lot of research and you’ll have some cash left over for emergencies after purchase until you’ve got bigger cash flow to start building up your reserves than go for it. As long as you feel good about it.

@Paul Kubin Hi Paul. I've been friends with my agent for 20 years. Over the years he's shown me whatever I've "had" to see at the moment. I amuse him. Recently we've done more transactions together and I finally feel he's got the hang of what I'm looking for. Not only am I on the MLS auto send for several local towns he also goes through the ones that are new at his agency each morning and sends me firsthand the best listings.

While I wouldn’t say he’s ever been the Rockstar up in my region he’s been here for 25 years following a distinguished banking career, and has focused on building solid relationships that create repeat clients.

You don’t always have to have the Rockstar to get everything you need. Sometimes being able to Foster your own perfect agent works out just as well.

@Seb Ko Hi Seb. I believe most people here recommend trying a smaller local bank or a credit union but I could be wrong. If you talk to someone in the lending department at these local type institutions they will quickly be able to tell you if they can help you or not.

@Daniel Lynch I was with my Ex for 20 years. For the first 8 we split costs and/or our business paid for everything. We sold that business and started a new one which never quite paid the bills and certainly not our expenses. My ex made good money as a real estate agent and would occasionally take me out to dinner but never paid bills or rent in my home. I racked up tens of thousands of debt and paid bills with a full time job and eventually we broke up and I started over. My ex continued living rent free for four years after our divorce in my home using my electricity, my cable, and my internet. I finally got the property sold and haven’t seen her in six months. I should have put my foot down 12 years ago and said we were splitting the bills.

Now I am debt free, have 10 doors and am looking to do more deals.

@Elizabeth Smith Locate a realtor who also has an international branch of marketing with their firm. You might have to find one who is not quite so local to yours or who is part of a chain like Century 21 or something that might work along side someone closer if a different branch office has the international marketing designation.

My local real estate company had some international connection when my bed and breakfast was listed during 2020 and Covid and we got a lot of foreign people who lived stateside whose family members abroad sent them to look.

Best of luck selling!

@Moe Die Both types of property have their ups and downs.

A single family rental has a conventional 30 year mortgage and usually a lower cash flow and traditionally costs less than its multi family counter part.

A small multi family, 2-4 units can also be bought with a 30 year conventional mortgage, will typically require a 25% down payment and after expenses should cash flow more than the single family.

Larger small multis 5-15 units are bought with commercial loans and as you get more tenants living together you can get more of the “headache” factor of dealing with larger amounts of people. These properties should cash flow more than the first two based on economies of scale, simply from having more units.

If you have little or no experience with property management I would recommend a single family house or a 1-4 unit to start with based on personal preference to get some experience before diving into the larger properties but nothing says you can’t buy a bigger one to start with if you feel comfortable with it.

@Justin Rockitter In my area there’s one inspector that is WAY more thorough than the rest. The realtors don’t like him because his reports tend to scare nervous buyers over small things. I’ve tried to get him for all my stuff but until my last property I’ve never been able to get him because he’s just booked solid.

However on this property he found things my contractor missed when we walked through including rotted floor joists throughout the basement and a partially unsupported chimney.

I brought in my “estimating contractor” who is familiar with pricing out work and knows the current costs of lumber as he is also a finished carpenter and he looked at everything and gave an estimate of $100,000 for the work needed on this $300,000 property.

At this point I could have taken or left the property and told the realtor my new price was $200,000. He negotiated a lower price and I said sorry I was firm at $200,000 and that is the price I got.

While I do have to pay out of pocket for the renovation it will all be write offs and I can fight my taxes on the lower price.

Between the $550 for the septic inspection by a septic inspector only not a septic company and the $500 for the very thorough building inspection it was the best money I’ve spent yet on my home inspections. My advice is don’t skimp get the inspections, check references, find the best inspector you can they can be worth their weight in gold.

@Maile Clancy I’m using GoDaddy SmartLine. I’m sure there’s better options but is $13 a month and working for now. However the selling realtor gave one tenant my real number who gave it to another tenant... so I’m kind of having a debate about just giving the real number out and saving the$150 a year.

@Emmanuel Ivory I always get inspections and got $94,900 off of my currently closing deal originally priced at $294,900 because of what we found and the estimate I got for repairs.