All Forum Posts by: Bill B.

That was kind of my point. It sure SEEMS like you could lose everything. Or more than everything if you’re required to return the land as-was. 

My only experience was a friend asking for a loan to “buy” and aircraft hanger on government land with only 20 years left. Even though the loan would have only been 10 years. I asked him his plan if they decided to expand the airport and tear down his hanger in 20 years. He didn’t have an answer and the government wouldn’t promise not to do it. So he walked. Or really, just remained a renter from the owner. 

@Dan M.. She needs a non-recourse loan because she's buying it with her IRA. If the loan had recourse she would be providing an asset/service to her IRA (her credit and guarantee.). That's not allowed. The same thing if she mowed the lawn (for free or for charge), stayed in a unit. Painted a room, etc etc.

I THINK supplemental heating is an option but that might be only on whole house heat pumps?  you’re probably going to need it or people are going to move out when winter hits. 

Check with local power company for incentives? They’re always shopping for new “lifelong” customers. 

If you put down 75%, do the rehab and then refinance. You’re still only going to get 75% of that new value. (Buy for $300k, put $75k down and borrow $225k. You put $50k into upgrades and it’s worth $400k. So you can borrow 75% ($300k) and you e only got $25k in the deal. As long as it’s cash flowing at that payment you should be fine. But it doesn’t mean it will. You might add 25% to the value but you increased your loan 33% and might only increase rent  10-15%. 

Assuming it cashflows and you have good credit you should be fine. “Back when it was hard to get a loan.” (2011-2015) I got 10 loans while unemployed (about $12k/mo total) because each property cash flowed. 

Don’t take out more debt than the property can pay on its own and you should be fine. 

Here’s how I would handle it. 1st year is market rent. At renewal you want them to stay you increase rent to new market with increase up to 7-10. You don’t want them to stay? Assuming you anren’t allowed to evict for no cause you switch to MTM and raise rent 12-15% (with the 5% MTM kicker.). If they stay you’re getting paid to deal with them. If they leave you’re free to reset rent. 

I think most people would be ok with a minimum 7% rent increase every year. (Assuming you never have negative CPi.) this is “reasonable rent control” and by reasonable I mean it will have zero effects at lowering rent and may actually increase it. As it will finally remind landlords why they don’t want to get behind the 8 ball in rent increases. 

@Mike V. I thought someone finally answered my question when I saw you had mentioned me. But now that I’m here. Your post is empty? Did you have a good answer? Can you repeat it?

-thanks

-Bill

Ask your agent/broker the premium affect of increasing your deductible. If it’s less than $2,500 definitely increase it. I usually find the sweet spot around $2500-$5,000. You’ll usually save the difference within 2 years. (Which really means 1 year and a day when you pay for the 2nd year.). 

This “HAS” to be true at $700/mo. 

Leaseholds have always confused me. Is there a written amount or law regarding how much it can be increased at expiration? I assume the property doesn’t just revert to the landholder but what if they tripled the lease?

does anyone have any expertise or experience with what happens at the end with valuable land not being used at it’s highest and best use?

I’ve had great luck with an ozone machine. Super cheap and no labor. Did it not work for you?

Dunn & Edward’s Nomadic Taupe.