All Forum Posts by: Alecia Loveless

@Jordan Laney I wouldn’t worry about $250. It’s the cost of doing business. It costs me $20 to transfer electric service into my name in most towns.

Am not sure if the $250 is the cost of the electricity from August until now or just one month. If it’s the cost of 3-4 months of electricity it’s probably pretty reasonable as my 1 bedroom units tend to run $35-$45 per month.

@Reyna Ayala No need for that many accounts. Most will say 1 savings for deposits and 1 checking for operations.

Personally I like 1 savings and 1 individual checking for each property. I feel like this gives me an instant screenshot of every expense for each building so I know Building A paid $1800 for insurance, Building B paid $2100 for insurance and Building C paid $2400 for insurance as opposed to having one account and seeing Insurance was $6300.

It just gives me a better screenshot in my opinion.

@Samuel Gebretnsae I’ve inspected properties that were having repairs done to them for water damage during the inspection.

Personally as long as the building didn’t flood I wouldn’t care. And if it had flooded it would be more than $5,000 for the repairs.

The only deal I’ve ever walked away from we determined that the entirety of two of the exterior, structural walls were significantly bowing and in the basement below them the foundation had been permanently covered so there was no way to see what it was doing.

Beyond something of extreme nature I find most things are repairable, especially if it’s a rental.

If it was for a personal residence I might be a little more concerned but I feel like $5000 worth of work isn’t very significant. I can easily get to that amount on a 3 day project.

@Raif Jochim I personally like having my primary paid off.

I’ve consulted several different people and they have told me in my situation as an investor expanding their portfolio it makes more sense to keep the extra cash as opposed to paying down rentals.

If you have the extra cash you can buy more units or be able to handle expenses that crop up more easily.

But be sure to consult with your own experts and accountant.

@Brady Ascheman Once the tenant is in I no longer worry about the 3X rule for rent. They will need to figure out for themselves if they can afford the increase.

It will likely cost you several thousand or more to rehab the home upon turnover. That could potentially take away all the extra from increasing $150 for several years.

As others said I’d increase $50 and keep the tenant. Then next year you can raise it again if the market still allows.

The $1000/month rate is likely for a fully rehabbed unit which is currently costing me about $5000-$7500 to accomplish.

@Jerell Edmonds If you don’t want to front the cost to add the extra meters then one solution that worked for my father was to divide the billed amount by one extra part each month and you pay for the extra part.

That way you’ve got some skin in the game, and the tenants will be less likely to protest that the other tenants are using more electricity or gas.

Up north the gas company will install additional meters for a very low cost, usually hourly billed time for the work and possibly low cost equipment. I think the last one I did was about $30/hour as opposed to what my gas guy charges which is about $125/hour.

@Jonathan Bombaci I think a good lawyer that has passed the bar to practice in two states is going to be more expensive than $200,000. I would imagine most attorneys located around the MA, NH border area plan to make more than $200,000 per year. Coming from a family of lawyers the ones in my experience that make less than that are usually just not that motivated or are not that good at what they do.

@Matthew C. I wouldn’t lower your credit score requirement or you’re going to end up needing to evict again and having turnover expenses.

The problem appears to be the overall location. Even with the renovated units it does not appear that there are enough prospective tenants to make this worth your while.

Is this a highly populated area, are there lots of jobs, are people moving to the area or is the population declining?

In the areas I’m in appropriately priced units rent very quickly to qualified renters. This is regardless of whether the unit has been renovated or not.

If the problem persists you might consider selling and looking for a better area.

@Portia Dampier Hey Portia. The two residential mentorships I did were bogus and a waste of about $15,000 all in that could have gone towards a project.

I would recommend looking into the SCORE Mentorship program. (Google it) It’s a nationwide program and Is free. They also offer courses and webinars. It’s a business oriented mentorship but the man I was paired with was well versed in all aspects of real estate investing and development.

They won’t offer financial advice or specifics about what they think you should do but are there to answer questions and help you look at things from different perspectives.

I’d recommend looking into this in conjunction with whatever other program you choose. It’s 1:1 and you can meet 1X or as often as you want.

After my initial email contact with my mentor I wrote out a list of questions for our phone call and we worked our way through them during our call.

I’ve been back in touch several times as questions arise. They have mentors in all different business sectors.

@Seth Williams I work in the group home industry. If you decide to pursue this option be sure to EXPLICITLY spell out how the maintenance of the buildings will be handled as these types of facilities tend to be hard on property from my experience.

I’d think long and hard about this and possibly set up financial parameters for who is responsible. For instance tenant responsibility for up to $500, $1000, whatever in repairs before landlord responsibility kicks in.

I’ve worked for some group home providers where they employ a maintenance worker who handles some of these issues (usually if the have multiple homes in a specific geographic location) and I’ve worked for homes where the handiest employee fixes things and that option doesn’t always have the best outcomes.

Where I’m working now has been through 3 dishwashers in the past 12 months (8 bedrooms). Now that the 3rd one is on the fritz they’re 8 weeks into waiting for service under the warranty. If there was a landlord I could see them demanding a 3rd new one because it’s a state requirement. To comply they’re using plastic utensils and paper dishes. Seems penny-wise and pound foolish. But would be an issue for a landlord.