All Forum Posts by: Ana Coello

@Elliot Friedman I would say we are in a solid B/B+ neighborhood. You can also get better rates with the cleaners when you make a long term commitment and we provide all the cleaning supplies. 

Hi @Elliot Friedman!

Welcome to House Hacking! We are currently HH and living in the basement but it's pretty much it's own independent unit so we are pretty separated from out tenants and it works out great for me and my partner. We have 3 tenants upstairs. I agree with Joseph that screening well is crucial for keeping a nice home but we still have yet to find out how to screen for a "cleanliness" and "selflessness" factor since looking at a person's car or attire when they come to check out the house can be deceiving. What we have done for keeping the house clean is included biweekly cleaning as part of the rent (we also include utilities). We got this idea from another house hacker in the area. It has worked out great for us so far. Hopefully that's another idea you can consider. You'll have to take it into account in your numbers to see if the property would be profitable, etc. But it works out for us and we like that we can give someone else employment, even through these tough times. 

Best wishes to you,

Ana 

That questions is open for anyone...sorry..

@Craig Curelop but is there any downside, let's say in taxes, when doing month to month? Don't lenders want to see 1 year leases? Or would these month-to-month be somehow STR income? Im thinking for the next step, when buying the next house...

Hi everyone! My name is Ana Coello, rental property investor in Rockville, MD. Working on paying down debt from my very first house hack (went way over budget on the rehab) so my partner and I can purchase our second house hack somewhere in the DMV. Maybe a small multifamily property? Though I know those are very few here. 

Anyway, would love to connect with fellow female investors in the area! Hit me up!

Hi @Aaron Romine and wife! My partner and I got our first house hack last year. We are renting by the room but we renovated the basement and are living here so we're a bit separated from our tenants (we have 3). Things I would recommend:

-Brando Turner's book on managing rental properties was awesome! It helped me get things in order before getting our tenants in. Things like getting a filing cabinet to keep all our paperwork organized is heaven for me. And he also shares documents like his lease in there. We use some of the stuff in our addendum to our lease (because we use our county lease for room rentals). 

-Talking about leases, be as thorough as you can possibly be. Even if you think you are being pedantic, go above and beyond. This is your house, this is your business. You don't want to have something happen that you wish you would have covered in your lease. That's were we are now. Our last tenant is showing us the holes in our lease. Things we said we would add but then forgot to do so or we were so tired of going through it that we left it for later and later never came. Sad but true. There's always room for improvement. Got to stay positive. 

-For us, we did a heavy renovation in the house so we haven't had many issues here with that but it's something to think about. Do you want to invest money upfront or replace things as they brake?

-About finding tenants: consistency is key. Create your "qualifying standards," who qualifies to be in your house, upfront so it makes it easier to screen tenants (this is talked about in Brandon's book) and avoid discrimination, though with you living in the property rules are a bit different. We posted online on craigslist, Zillow (Zillow posts to trulia and hotpads), cozy (cozy posts to realtor.com and some other that we never got leads from), facebook groups. Kept refreshing posts until we found our tenants. Do not be afraid to be picky.

-We have heard that we are super "extra" since we rent by the room and people aren't use to being so formal with room rentals, but we have established the rules and formality from day one. Our tenants live their own lives in peace and so do we. So far this year has been good. I would say most of the work was put into finding the tenants. After that it's been pretty smooth.

Congratulations to you both on the house and on this journey you're about to start. 

Warm wishes,

Ana

@Kevin Zolea

For rents, rentometer seemed off for our area (MD very close to DC). We used Craigslist a lot. You can also check out Trulia, realtor.com, hotpads. That’s where we advertise room rentals. (Zillow posts to trulia and hotpads, it doesn’t advertise room rentals). You also have to take into account your neighborhood (are you close to the metro/subway?) and your amenities (utilities included?, new appliances?, modern aesthetic?) because that can move your rent up or down. 

For rehabs before we bought it went to see the property, we did VERY generous and general estimates based on the prices for our area. So get familiar with your prices. Peruse Home Depot, Lowe’s, etc. to just get a feel for what a toilet costs as well as flooring, etc. When you go visit a house you can take pictures or videos and then go home and make a more specific estimate of what you’ll think needs work. Also be very generous when making your numbers. If you believe the house works then make an offer. You’ll have time for an inspection and to take a contractor to check it out as well. Remember that if you work with a real estate investor/agent, he/she will also have some ideas as for the remodeling of the home. We used our agent as a guide as well. Different houses will require different estimates. 

@Kevin Zolea, no problem! 

Since September we have gotten 2 tenants and are working on our third. The tenants that we have are quality tenants that have given us no problems whatsoever and pay their rent on time. The rents have worked out like we projected them. Utilities as well, some even a little less because we had to get new ac and heating in the remodel so the new models are more energy efficient. We also had our energy company come do an inspection of the house to see where we could be more efficient. They insulated the water heater pipes and that's about it since we have everything else energy efficient (appliances, lights, etc.). Since we put a big chunk of change in the remodel, we haven't really had any problems with anything breaking (no repairs), except one backed up pipe that was pretty much the only one we didn't replace (that's a whole other story).  

Now we are working on paying down the remodeling debt to lower our debt-to-income ratio to refinance the house and get the cash out to use for the next house. 

Any particular questions you have? 

@Zach Wright,

For finding properties we first went to get approved at a bank. (had to do some research there but just get an initial letter of approval so you can know what you're able to work with). Then we talked to an agent who is a real estate agent himself, was actually on the BP podcast, and told him we already pre-approved and were serious about buying a house. We had our criteria of what we thought was best for us and we encouraged his feedback. He agreed to work with us and from then on it was golden. He was very knowledgable; not only about the real estate market but also about rehabbing the property to maximize profits, etc. He was a real asset to us. 

We would try to go to every house together, my partner and I. But the house that we ended up getting I went to see it with our agent. We went to see it the very first day it was on the market. My partner had to work so he couldn't go but I was there asap. I saw the potential in the house and our realtor told us it was a good area, near the subway/metro/public transportation with great schools (if we ever were to rent it to a family), etc. 

We put an offer in quickly and went to see it with a couple of contractors the day of the inspection. It had a tenant in so we had to do everything at the same time, which was crazy busy but time efficient too. We tried to time the contractors one after the other. 

We, my partner and I, never saw or spoke to the seller or the selling agent. Our realtor dealt with all of that. Advice: get a really good agent who knows about real estate investing. 

Like always, happy to help with every bit of info possible.

-Ana

Hi @Dante Campbell!

What are some things you wish you knew before you started?

- I wish I understood that even if I read a book that walks me through a process (like Brandon Turner’s book on Managing Rental Properties), you’ll still have to do A LOT of research on the laws on your area. That’s also a tip. Please get very very familiar with the laws in your area. If you’re renting, like me, then all the little intricacies from how much can you charge for an application fee to bigger things like the eviction process. Know your laws. 

-I also wish I had really listened and internalized when people said that in a rehab you will go over budget and things will go over on time as well. Good thing we had enough money to keep us going (paying the mortgage and everything else) while going over budget and extending the renovation process for more than we would’ve liked. 

Videos/Books/Podcasts?

-I’ve read the book on Managing Rental properties by Brandon and Heather Turner. Recommend it 100%. They explain the whole process of landlording and even give you the forms they use. I also used the 2 books on estimating rehab costs by J Scott. Great way to understand how to break down a rehab. Though there is Never anything like doing it. Once you go a million times a day to HomeDepot or Lowe’s or any other hardware store and you become familiar with all the prices in your area, things start to make a bit more sense. Also working with your contractor, if he/she explains things to you then you’re set. And last but not least, I’ve listened to every single episode of the BP podcast. Gotta find the best way you learn and for me, this podcast is an easy way to understand many concepts in real estate. 

How to know if that first steps right?

I don’t think you ever truly know. I trust my assessment (I use the BP calculators and run many scenarios for the same house. The worst case scenario where everything is expensive and the best case one where everything is cheap. I try to get as accurate numbers as possible and I trust the process. You just have to get started. 

What first step would be right?

Whatever moves you forward. If you are ready for a change and want to start just jump right in. We (my life partner and me) made the decision to buy our first house for a house hack a year before we bought it. We prepared by increasing our knowledge while decreasing our debt and starting to save money aggressively and with a purpose. We used that for our down payment and to have the best credit score for the purchase of the house.

Really any information helps I appreciate your time thank you!

Really it’s been quite an experience but I wouldn’t change it. Someone recently told me that it’s been the most risky “move” I’ve ever done. But to be honest I don’t see the risk because I’ve planned everything so carefully and I believe in Real Estate, in the everlasting Rental market. I’ve armed myself with the knowledge to move forward. Now it’s patience and hard work. You can do it. Trust yourself.