All Forum Posts by: Andy Gross

So all in the buyer could put this on the market as a rental for 41k? If they collect 850 per month, the roi seems pretty solid. Might be a hassle to manage, but dollar for dollar it looks pretty good.

Thanks for the video. This place clearly needs some love, as discussed, but how much love? Can you put a dollar amount estimate on how much it would cost to put this place back on the rental market? How much to do so and to ensure its lead-free?

Be weary of the "per-room" lease. I would avoid it if possible. My family used to own some properties in College Park, MD, and the "per-room" lease inevitably resulted in monthly calls to the landlord (my dad) to complain about a fellow housemate. If you rent to a group, there is at least the hope that a group will come together on their own.

I can't suggest a Realtor, but I can suggest a neighborhood. I recommend the Charles Street corridor for 2-4 unit rowhomes. You can be about 2 blocks off of Charles Street and generally be ok, although the aread between Penn Station and about 26th street is a bit more "transitional." If you don't have kids, and are looking for a greater potential of appreciation or value-add, that area is not bad, but still has a degree of blight. Bolton Hill is great as well, but it tends to be a bit more expensive, as it's completely stabilized. Reservoir Hill has gorgeous victorian homes, but it's more block-to-block. I almost bought in Reservoir Hill a few years ago, and if I weren't looking at moving to the 'burbs for family reasons, I'd be looking again.

@David C. 

I'm seeing deals approaching 2% in the Baltimore area, although if you did it all yourself, I imagine the more experienced investors are getting closer to 3%. Turnkey seems to be hanging out in the 1.5% area, which isn't bad. These rules don't really take into account expenses, and I've have to see a pro-forma first, and for all I know, the property could need a new water heater, stove, dishwasher and roof within 6 months of purchase.

Hello BP Nation. I apologize for the Seinfeld-esque question, but what's the deal?

I see advertised properties that meet the 2% rule, or come close, and they claim to have a tenant in place, management ready, etc, and all you have to do is come up with the cash to buy the property that is generating upwards of 20% cash-on-cash returns assuming a 20-25% downpayment. If it's such a good deal, why is the Turnkey company selling it? Is it just to raise capital? Are Turnkey companies just another type of flipper, buying distressed assets, cleaning them up, placing a tenant and selling for a profit? What's the motivation?

Without adequate market studies of your specific neighborhood, you may over-improve the dwelling. I think that before sinking cash into a unit to upgrade it (vs. using the cash to acquire additional units), your rental comps have to be solid, taking into account the actual vacancy losses incurred by higher-cost units.

As @Rob Gribben  pointed out, you might get more money, and even a better tenant, but will you have more turnover and is the cash worth the downtime? Canton is a funny market, and I don't think you have too many folks renting for more than 2-3 years because it's a young crowd there for their first job before they get married/sick of the bar scene/enough money to buy a place. I'd personally be weary of improving beyond the B range of rentals in that neighborhood. 

In Oahu, your place has to radically overpriced or a total dump not to rent within a weekend. When we were looking for places, our application was usually in a stack of 4-5 fully qualified, great tenants, and 10 more "ok" tenants.

@Chris Pappas  welcome to BP! I graduated the University of Baltimore a few years ago and considered going back to get a Masters in RE Development, but this site seems to have a great deal of free info. How do you like the program?

Lots of folks post on BP and never pull the trigger, which is why I think they include a question on getting started in the "Famous Four" segment of the podcast. Or, they get frustrated because they can't find a class A, turn-key property with long term tenants in place that yields 2%. There will always be the place for the savvy investor who can get excited about a deal while critically analysing the micro and macro forces at play.

A gun in the hands of a well trained individual do nothing when that individual has the element of surprise. If you are relying on your gun to keep you safe, you are a fool, and someone is going to get hurt or killed. Caution is what keeps you safe, and the would-be attacker knowing that they will not get away with shenanigans is what prevents attacks.

When I sold cars, we would copy the test-driver's ID before any car left the lot. Could a cautious Realtor do the same before showing houses?

@Tyrus Shivers As far as bird-dogging in Baltimore City, looking at vacants, etc.,

 I would never go alone and I would never go at night and without my trusty 4 D-Cell Maglite.