All Forum Posts by: Brandon Pearsons

@ Jean--- Thanks for your reply I just checked out those sites and see its Commercial RE. I am unfamiliar with commercial renting and numbers right now.. Ill keep checking those sites

@ Jim Ya Im getting a loan. I am thinking of making a low ball offer and see what happens. Im not sure.. Its the mandatory flood insurance that spooked me. I dont want to deal with tenants stuff getting ruined. Its hard to find deals that positive cash flow with 20% down around 100k purchase prices.

@ Bill good point. Ya Im less worried about the busy street because I can write something into the lease regarding that they are renting a property on a busy street and it may be noisy. If a flood happens and their stuff gets ruined that will be a mess...

Hi Andre

What sort of Cash ROI would you think would make it worth it? Here is the break down. That 1% rule doesnt seem to work in CA

Asking price 110k

annual taxes 1300 a year

flood insurance 1300 a year

property insurance 650

Paid water and trash $80 a month

potential rent 1050

Investment 20% down plus 10k in rehab

Thanks

Jean,

I tried to send this through a personal message, but it wouldnt let me

Hi Thanks for the reply to my post. I just read your profile. How do you find out out state investment? I see you purchased one in OH. It is hard to find positive cash flow with 20% down in my area.

Thanks

Thank you both for replying...

I think both of you two hit it.... I feel like I am missing the boat as I see property values and rates rise.

True, the increase flood insurance rate could eat up any positive cash flow in the future.

Hello All,

I am trying to get feedback on a REO that is located on a busy street in an area that requires flood insurance. This street seems to have a lot of road noise, which makes it hard to hold a conversation outside.

Inventory is very low and want to keep my rentals local so I can work on them myself. This is probably my only opportunity for a while. Prices keep going and there are very little investment properties that come around.

What do you all think?????

Hello,

I am wondering what your thoughts would be in regards to buying a nice investment rental house on a busy street*, it is also in flood zone A ( required flood insurance)

Inventory is very low and want to keep my rentals local so I can work on them myself. This is probably my only opportunity for a while. Prices keep going up and the numbers are working so much anymore. The numbers seem ok with this place.

* I had to wait for cars pass on the road in order to continue my conversation with the neighbor because of the road noise. We were standing a few feet apart.

This house is located in a blue collar community. This house is in a good neighborhood, but the surrounding areas are not the best.

I am having a rough time finding good tenants:

These are my options

a) $1000 per month new nurse, young pretty 24 years old, new to the area. I doubt she will like living in this area. No kids, no pets, non smoker. Doubt will stay more than 1 year

b) $1065 per month Nice couple, late 30s 2 kids living off the system. kids were wild, spilling my paint when I was there
they smoke. There 5 year old son has autism so he has fits so it might annoy the neighors, and damage the house a little. I like them. The carpet is new, and they dont wear shoes on the carpet which is a plus ( unless this was a show for me ;). Probably will stay years, unless the quiet neighbors on both sides have issues with them.

c) $1065 per month 44 year old male and 32 year fiancee. The guy is 6-6 and has albino white hair that is long but shaved up to the bangs on his head. The neighbor seemed creeped out. His income is hard to trace. Cashes checks, no bank account. His fiancee's income is traceable. He dressed a little slobby too.
He is a nice guy and his story totally checks out. Everything he said. He used to own a 400k house broke his back lost it. I didn't entirely trust him because of his haircut and dress...

d) $1065 per month another couple. Group of 5. Smokers no pets. He works an hour away. there are not jobs in the area.

the Mortgage aankers reply

Usually by this time...either you will refinance or sell. Its a norm. Therefore, from loan prespective, if its taking over 3 years to breakeven then we suggest no points.

Its strange the Mortgage Company's rule of thumb is it does not pay off in a few years don't by the points. This is an investment property that I plan on holding for 10 years or so...

What do you all think is the best option?

4.0% -1.40% points - Payment - $427.76 (principal and interest)

4.125%- 0.7%points - Payment - $434.25 (principal and interest)

4.25%- no points - Payment - $440.78 (principal and interest)

Thanks

Hi

Is the following correct?

All re-hab costs are only deductible after the property is sold again? Seems like a long time to wait for a rental... =\

And after a tenant moves in the repair work is accounted for as a deducted the end of the current tax year?

Lastly, Is de-appreciation in terms of taxation, pretty much just a loan? I do not see any benefit....Maybe I am missing it..

Thanks