All Forum Posts by: Brian Carnesecchi

I am an experienced realtor who has been out of the business for about 2 years. I am looking at a great prospect for my first rental property but I have no money to put down on it myself. As I think about calculating what payments would be if I had a cash investor to fund it, what kind of loan would be typical from a cash investor? Interest-only for a set period of time such as 2 or 3 years? And what kind of interest rates should I expect to pay a cash investor right now? 

Thanks of your help!

Hi, I live on a 2.5 acre parcel of land behind a subdivision. My driveway is an easement that runs along the backyard border of 5 houses in this neighborhood. One of those 5 houses just went up for sale. While we are in a hot market just south of Raleigh and everything is overpriced, this home is in an area that I fully expect to continue to have growth and appreciation long term. I am interested in buying the home with investor funds. Cash flow will be tight, but the future equity opportunity and its close proximity to my home is appealing to me.

My problem is this: I just read through the restrictive covenants and it specifically states in there that there may be no rentals. However, I also believe that the HOA is not very active and possibly non existent or not active at all. The neighbor next to this guy has 3 backyard chickens even though the RC prohibit them. Another neighbor in the neighborhood drives his 4 wheelers loudly and fast up and down the street, which is a nuisance and no one does anything. People have rv's parked in their driveway when the rc states they must be behind the house and not visible.

Am I taking too much of a risk to buy this home and turn it into a rental given this situation?

Hi, I live on a 2.5 acre parcel of land behind a subdivision. My driveway is an easement that runs along the backyard border of 5 houses in this neighborhood. One of those 5 houses just went up for sale. While we are in a hot market just south of Raleigh and everything is overpriced, this home is in an area that I fully expect to continue to have growth and appreciation long term. I am interested in buying the home with investor funds. Cash flow will be tight, but the future equity opportunity and its close proximity to my home is appealing to me. 

My problem is this: I just read through the restrictive covenants and it specifically states in there that there may be no rentals. However, I also believe that the HOA is not very active and possibly non existent or not active at all. The neighbor next to this guy has 3 backyard chickens even though the RC prohibit them. Another neighbor in the neighborhood drives his 4 wheelers loudly and fast up and down the street, which is a nuisance and no one does anything. People have rv's parked in their driveway when the rc states they must be behind the house and not visible.

Am I taking too much of a risk to buy this home and turn it into a rental given this situation?

It is an alluring situation because the property gross's $6900 per month and I think I can purchase it for around $550,000. But it's possible that when I change the structure of how it is managed, it might gross less. 

Yeah, the current owners seem to have a great relationship with the tenants and they have been there a long time. But I was thinking that when I take it over and it becomes managed more like a business without the personal interaction between the landlords and the tenants, then I would probably lose a lot of the tenants. Thanks for your response. 

I am looking at buying a property wherethe current 80 year old owners are local and have been managing it themselves and treating it like a motel. They have hand written agreements with the tenants and the tenants pay rent weekly. The landlords have the have given themselves the right to enter each unit weekly to collect the cash rent payments from the rent book they leave in the units. It is 2 houses Tha they have converted into 7 1 bedroom efficiency apartments.

But I want to buy it and have a property management company manage it. My concern is that there are no legal leases, and the tenants have grown accustomed to paying weekly rent in cash. I would have to retrain them in a new way.

Thoughts?