All Forum Posts by: Brian Knox

Say worst comes to worst and - in order to fix the root-clogged pipes beneath my rental's bathroom - the entire floor has to be pulled up. Either the bathroom or the laundry room (whichever gives better access to the pipes) becomes an off-limits work zone for a week:

What do you do with a temporarily displaced renter?

I mean, do I need to put them up in a hotel or something?

The bathroom in question is the house's one FULL BR, the only shower. My tenants are a mother and her two children (14 and 8).

Not kidding: I have literally lost sleep over this damn landlord situation for 3 weeks now.

Pulling my hair out (and I'm bald),

Brian

I live in an area where tons of houses end up with roots in their underground pipes.

One pipe has had recurring problems and Roto Rooter is suggesting installation of an outdoor clean-out (since the house's current one is small and insufficient).

It involves excavation and the RR guy says that, unfortunately, he's not 100% sure whether the problem pipe is inside the house's footing (under the house) or outside the footing (and accessible with an excavator). He says his equipment is sophisticated and he's about 80% sure the pipe is outside the footing. But only excavation will reveal the answer for certain.

Of course, the excavating costs an arm and a leg. And it could all be for naught.

Have you faced a similar situation? Or do you have advice?

Brian

Hey Chris!
I too have a 4yr old and 1yr old (daughters). Greenville is my hometown and - after being away in the Midwest for 9 years - we are moving back at the end of 2013.

I have one single-family rental house and it's gone decently.
I typically refer to it as a "breakeven-quick-scheme."

Greenville is a great city. Maybe we can connect one day.
I'm open to learning anything you've learned through experience and am glad to share any insight I may have picked up along the way.

Brian

Great info from you all:
John Rubino:Would the lease option to buy be like C for D? or Rent to Own? Yes, totally open to that.
Curt Smith: helpful points!
Jon Holdman: I love that you don't candy coat. You are blunt and, consequently, helpful. If we sell the house now, we lose $6000 after all closing fees.
W2 Income: way under $100,000
How do I figure out the remaining value to depreciate?
50% rule: Yeah, losing about $300 per month. This is nasty.
Other input?
Steve Babiak: #2. Absolutely. All sorts of landlords in St. Cloud getting
"special assessments" due to their deadbeat tenants.
Brian Mathews: Job transfer and cross-country move (due to MN climate and proximity to grandparents). St. Cloud market is inching up, but slowly and not right in our neighborhood.

Open to all input. Be blunt with me.

Can't sell our residence in MN and are forced to rent it. Cash flow is break-even or slightly negative if I rent it out. Can you help me understand the tax benefits?

Monthly outgo: $840 PITI + $110 Property Management + $50 water bill
Monthly income: $1000

Mortgage remaining: $99,900
Tax assessed value: $115,000

I am feeling terrible about having to rent it out due to the break-even cash flow + the uncertainty of big expenditures.

But will I realize any other of the standard Real Estate benefits?
1) Cash Flow
2) Appreciation
3) Equity
4) Tax advantages

Many thanks. I feel stupid for not knowing how to figure the tax stuff. This would be my second rental property but I am a novice.

Brian in St. Cloud MN

We just had massive storms in St. Cloud, MN causing numerous tree-damaged houses.

What is a landlord to do if a tree falls onto the rental house and displaces your renters? I mean, if the house is not presently inhabitable, who puts them up in a hotel?

Thanks for your advice,
BK

Hi Christian!
Since you bought at such a low price, are you not able to rent the place out for lower than $1,000/mth and still make cash flow?

What is your PITI or your monthly outgo?

I am a huge fan of Section 8 only because my first and only experience with govt-assisted renters has been great. They have all sorts of incentive to:
1) pay the rent
2) not screw your place up

If they miss rent or do damage, they won't have government backing in the future. At least that's the way it seems to be here in MN.

Fort Knox

Great feedback, all! I appreciate you giving your time.
Still hoping to sell at $119,900. Open to renting as last resort.

Even though we're not Catholic, we even tried burying a statue of St. Joseph in the yard. The urban legend is that it works because he's the "Saint of House Sales." : )

Hey Deadrick Colbert! Do you go to the upstate REIA meetings? I have never been before but plan to go once I relocate to GVille in September of this year.
Seems like there must be legit content at them.

I am way more of a "work hard, educate yourself, and network" type of investor than I am a guru follower (enticed though I may be : ) ) It seems like REIA might be up my alley and I'm wondering what feedback others have.

BKnox

Andy M., I agree that Art of Exceptional Living is great! Also go for "The Challenge to Succeed" by Rohn. It's pretty much the classic.

Do not waste money on "The Power of Ambition" by Rohn. I am a HUGE Rohn fan and I can barely suffer through the boring recording of "Power of Ambition." Title sounds great but the delivery is flat.

I'm an student at Automobile University and I will also recommend Dolf De Roos' "Wealth Magnet" which has a strong Real Estate bent.

Stay up, Winner.