All Forum Posts by: Audrey X.

@William Pelton if it takes longer than 5 years to generate income, I personally think that's a poor investment. I think your plan works if you already have the cash and can build and place in service quickly. Otherwise there are other investments where you can get a return faster. 5-10 years is a long time to lose in compound interest.

@Murali Ponnaluri rodents can cause structural and fire issues (chewing electrical wires). Depending on your investment amount and how long you plan to hold, you may want to take care of this yourself rather than the tenants.

@Harsh R.

$1400 rent seems really high for Cobb. I have a townhouse between Kennesaw and Marietta, great location, close to KSU and Marietta Square. It took me two months to rent it at $1375 back in February, right before COVID hit. It was newly renovated and everything. 3 bedrooms 2 baths Now the tenant is having problems paying. I think you will have a hard time finding quality renters at your price point. For $1400+, quality renters could just buy a house, why rent. Bottom line is I don't think you'll cash flow.

@Shakiah Naverre the minimum banks will refinance these days is $80,000. Credit unions may have lower thresholds but probably not $25k. Too little money to be worth their time. Someone mentioned HELOCs. I think that's a viable option worth checking out. Good luck.

Has anyone used e1031xchange owned by the law firm of Jerry M. Feeney in NY? The fee is a flat $495 for a one-one exchange. Pricing is great but are they legit?

@Hieu Bui

I re-did the siding on a townhouse rental of mine 5 years ago in Marietta, GA, three sides only and it was around $10,000. For yours, definitely budget around $10,000 minimum especially with water issues. Inside looks like you may need to redo some drywall before you can paint. What you're budgeting is definitely low. Triple what you estimated like what others said. There will be hidden issues.

@Julian Fung

If there is no restriction on renting, then it will be harder to sell. The reason being that it likely won't be warrantable for a conventional mortgage so lenders will be substantially limited for buyers (unless they're cash buyers). Any condo with higher than 20-25% rentals will not qualify for conventional mortgage. Home appreciation will also be less than SFH.

@Tyler Kress

As others have said, don't worry about your family's approval. If you find a deal where the numbers work, you're not stretching yourselves, it's in a decent area where people would want to live, you don't mind sharing the house with other people, AND you are handy with self repairs and won't be overwhelmed with common (not necessarily frequent) plumbing, patching, and painting issues, I'd say it's a great plan. Good luck.

@Justin Wood Find their address using a third party website like peoplefinder and file a small claims lawsuit in the jurisdiction/county that they live. There are fillable forms at the courthouse for these "complaints," very easy and it's cheap $100-200. The clerks at the courthouse are helpful and will answer most of your questions. This is an option if your tenants are local. If your tenants move far away, you'll have no choice but to hire an attorney to file the lawsuit for you. Could cost your $1500-2000. Most lawyers have access to a database/search engine where they can track people down.

@Eamonn McElroy

There's always cash out refinance if there's no HELOC. Ideally, the property will be paid off in 15 years or 75% paid off. Who wouldn't loan money on a property free and clear or close to free and clear? You keep leasing it until that money is paid back by your tenant and you still get tax deductions. The RE market is never going to crash like it did in 2008. Plus, the stock market crashed in 2008 too so it's not like your investment is safe there depending on the economic cycle.

Everybody sells the 7% compound interest thing but I haven't seen my index funds grow at an average of 6% in 10 years with the highs and lows in the market. The funds go up mostly because I keep contributing each year. The actual return in 10 years basically kept me above inflation. So I wouldn't bank on those compound interest calculations. Just keep saving money and hope your principal will be there when it's time to withdraw.