All Forum Posts by: Frank Adams

Yep, Pam is right on again! I used to tell my tenants that I would come over and snake the drain, BUT if a Barbie Doll or similar comes out they're paying. Never had a quarrel with a tenant regarding this.

all cash

2500 or so square feet on the golf course, a bit more off the golf course. About 1800 square feet on the lake!

Of course it also gets you $6500 a year in property taxes!

all cash

I've found the "best" place to add is either behind or (in a multi-story) directly under, the original bathroom. Sometimes adding a 1/2 bath (toilet and sink) is way cheaper than adding the whole bath.

I've done them by "shrinking" a bedroom and adding a separate door, adding it into a pre-existing a laundry room, and making a small room between an attached garage and a house.

The cheapest one I ever did was the one in the laundry room. Toilet was $5, towel bars and toilet paper holder $1.50 for all three, 8 light light fixture $2, discontinued pedastal sink at HD $10, faucet free and mirror free from a friend. I spent more on PVC and PVC cement than the rest of it combined. May be a record for cheap baths.

Good luck

all cash

I know a lot of you think rehabs are a great source and IMO they are. But, be careful you don't bite off more than you can chew, and make sure you doublecheck your numbers, then doublecheck them about 6 more times.

I've been doing this for almost 30 years so I'm not a virgin. I still like doing it but I don't need the money, or the hassles. I bought a little pier and beam frame house back in April that was a real wreck! I knew it would be a moneymaker since I was buying it for $24K and I looked at it six ways from Sunday before making an offer.

Some things I knew it needed.

Roof and some of the roof decking
Some interior doors and replace a crappy sliding door.
Siding, part was Masonite, part was T-111, lots was termite and water damaged
Some structural. I knew that at least 8 feet of studs were termite eaten away.
A fair amount of plumbing
Pretty much all new baths, and kitchn.

Anyway every time I looked at it I added another $500-$750 to my last estimate, I'm not quite done with the living room-dining room ceiling, still have to texture and paint the walls in those rooms as well. Haven't done a thing to the kitchen.

I had figured my total MATERIALS at $9K, I'm at $8K now and still need some tile and kitchen cabinets, countertops etc. Luckily it's a small kitchen!
I knew some roof decking was bad, turned out about 40% was!
I figured about $300 for electrican, it was $600, but he did some extras though.
Replacing the AC was about $700 more, all the flex duct was bad and the registers were pretty rusty.
Ended up with more termite eaten studs than I had anticipated.

On the plus side some friends GAVE ME 5 gallons of high dollar exterior paint that was extra when their place was repaintd. They also GAVE ME 7 really expensive interior doorknobs (4 privacy, 3 passage) that they didn't like once they got them. These things are more expensive than any doorknob I've ever bought and they wouldn't accept a nickel for them. Another plus is yard sale light fixtures and kitchen sink!

I've already had an offer of $75K from a couple that saw it when it was a WRECK. Even if I go nuts on the kichen and second bath I won't have a total of $40K in it (I had hoped for $35K max), so I know I'm going to
make out fine on it. But this should be a warning to those of you who take on the real thin deals.

all cash

When you moved out and the house became a rental you should have changed your policy from a "homeowner's" policy to a "Fire and Extended Coverage" (Fire and EC in insurance lingo).

If YOUR insurance agent didn't do this for you when you moved HE IS DERELICT IN HIS DUTIES. And let's face it, he knew once your property address and mailing address were no longer the same!

The Fire and EC policy should be a bit cheaper than your homeowner's policy was since it doesn't insure any CONTENTS. I'm sure the mortgage company can't call the loan just because it's no longer a primary residence, but check your loan documents just to be sure. If it's a "conforming" loan I know they can't.

all cash

Sorry Sammy, I've been absent a bit lately, doing another rehab.

Well I'd NEVER use a property manager, I always did it all myself. I found the best advertising was a SIGN IN THE YARD. A buddy of mine got me started doing that instead of advertising in the paper. Here's why.

In the paper (in Houston at the time) you get a lot of calls from people who might be 50 miles away and dont' recognize the name of the subdivsion. So you waste a lot of time talking to them. Anyone calling off a sign in the yard has pretty much already qualified the neighborhood so they're definitely interested.

all cash

You're renting property (for two years) in the strictest consurmer protection state and you're not up on the laws! Time to get with it. You might want to see about joining your local property owner's (apartment manager's) association and/or a local RE investment club. Lots of good ideas there.

I sold my CA house four years ago so I'm not 100% up to date but the short answer to both questions is NO. Painting (after two years) is normal wear and tear. I think carpet cleaning after the same period would be the same.

BTW, your deposit is WAY TOO LOW! How did you arrive at $1900? Most landlords (incorrectly in my view) charge one month's rent as deposit. In San Diego one month's rent would have to be at least $400K if my neice is to be believed on house prices, and I think she is.

My rule of thumb was that my SECURITY DEPOSIT (not cleaning deposit) was equal to about 130% of monthly rent. So if the rent is $3,000, the SECURITY DEPOSIT is $3900! Hope they don't stiff you!

all cash

Isn't your house insured? Your homeowner's insurance (required if you have a mortgage, good idea even if you're free and clear) has GENERAL LIABILITY as one of it's key ingredients. That's your insurance for anyone getting injured.

Look, there's about 70 MILLION housing units in the US, lots of people coming onto the property all the time, repairmen, delivery drivers, contractors, post office etc.

In addition to your homeowners liability you may want to carry an UMBRELLA POLICY for at least ONE MILLION. This is particularly true if your net worth exceeds the policy limits of your homeowner's. IIRC we pay about $200/year for one million coverage.

all cash

I"m kind of torn on this one, I used to have my license. I got it because I got tired of agents NOT RETURNING phone calls and also I had two of them SNAKE ME OUT OF DEALS using straw men.

However, I really got it because AT THE TIME, Houston was going through about 500 or so FORECLOSURES per week. Having my license got me personal access to the weekly HUD SEALED BID OPENING. There was a slight advantage to that access.

Having the MLS access got me "first look" at the "new listings" first thing each morning. Having the access that way, along with the listing agents comments; particularly comments such as "seller looking to ZERO OUT (that is, walk away from closing with no gain and no loss) were good things to know as the market started to turn upward. I bought a few VA and FHA assumptions back then (late '80s, early 90s), and sold quite a few to investor acquaintances.

Once the "big run" in Houston ended I surrendered my license. My salaried job paid me more than the average agent earned, with lots less expenses and hassles.

Now I don't worry about agents not returning my phone calls. NOW THEY DON'T RETURN MY EMAILS EITHER, LAZY BUGGERS.

all cash

IMO, most RE agents, like most other people are way below average! The first cut-off for me is NOT RETURNING PHONE CALLS, or taking their sweet time about doing it.

When I meet an agent for the first time I tell him or her what my expectations are insofar as service and timeliness of response. Most promise the world and then don't deliver. The best agent I ever worked with sold me 7 houses in about 16 months, then she decided to move to be near her kids and grandkids. When she moved she gave all my contact info to two "up and coming" agents in the office. NEITHER ONE ever contacted me. I've been to the office many times since, and had different agents show me various places.

When I go in the office everyone knows who I am and that I'm a CASH BUYER. But the ones that show me places and the more experienced ones have something in common; NONE OF THEM FOLLOW UP. In the two years since Carolyn left I've done ZERO DEALS with that office.

all cash