All Forum Posts by: Carl C.

I don't know about resale but it sounds like you have a house that had some additions put on after the original structure. They were possibly some sort of porch or garage that were closed in which would explain the height difference. It's not necessarily a problem as long as the additions were built properly. No one here can tell you that without looking at the structure. You should have a home inspector check it out for you. 

Thanks for all your advice everyone! I started by double checking my leases and found they are really deficient when it comes to defining garbage removal from the house. I'll be clearing that up when the new leases go out. 

It sounds like the garbage removal has been an ongoing issue internally with the tenants and one of the parents is trying to solve the problem. We are going to look into the cost of the extra removal then have a conversation with them about splitting the cost and actually removing the garbage for proper pickup. From now on my lease will be much more clear about who is responsible for what.

Hi everyone. I have a rental house with 4 boys in it. This is their first time living on their own and as a result, they have had to learn how to take the trash out and so far have failed miserably. I pay for garbage and recycling collection which comes once every week. I asked for the largest can the company provides but the guys still seem to make an amazing amount of trash. The garbage company won't pick up trash if it isn't in their can (so no extra bags if they don't fit). The boys claim they missed one week of putting the trash out and now they can't catch up because it won't fit in the can. Walking through the house the other week, they had 15 bags of garbage in the basement waiting to go out. I told them that was unacceptable as it will attract rodents and moved the bags to the detached garage. Neighbors tell me they rarely see the garbage being put out which doesn't really surprise me because, well, they're college kids. Now one of the parents wants me to get an additional can so all the garbage can be thrown out and the current backlog doesn't happen again. Overall the tenants are very good and I've had no trouble with their parents. I'd like to find a solution that is mutually acceptable but I really think this has happened because they missed several weeks of putting the trash out. Anyone ever deal with something similar? Any suggestions for how I can deal with this diplomatically? 

@Robert Crawford Great question, I'd love to get a multi-family but they simply don't exist in the neighborhood where the students will rent. So our only option is SFH for what we are trying to accomplish now.

@Steve L.  I like the idea for seller financing. I'm going to bring that up as an option with them, thanks!

@Account Closed  It's funny, as I was typing the original post up I realized that the $130 house makes more sense financially as long as it doesn't need major renovations. In my head it seemed less clear. Thanks for the help!

My partner and I have been on the lookout for our next potential deal. We have one college rental and are looking for the next. A few months ago our next door neighbors listed their house for sale for $210,000 which would really be the very upper end of similar sales in the neighborhood. The owner has been in the house for 70 years (he was born there!) and is meticulous about maintenance. The house needs nothing. so we talked a while back and said we were interested. They have no mortgage and are looking to get into a newer house with no stairs and less maintenance ( and out of the now-college neighborhood). We made an offer of $180,000 understanding that they need time to find a new house and they are not emotionally ready to let go. We talk every now and then with them and so far no one else has made an offer on the house. They didn't reject our offer and they didn't accept it yet. We haven't been pushing because slower has been better for us so far. I know I can get $2600 for rent for the house with estimated monthly cashflow of around $1200. There are a few other houses in the neighborhood that are for sale that are priced about 50K lower with unknown repair needs. One in particular I know I could get similar rent with about $200 more monthly cashflow. Having read a lot on biggerpockets recently I can't help but think that the house for $130,000 may make more financial sense (depending on repair needs) even if the house next door is more convenient. I'm going to set up an appointment to see the $130 house as soon as I can (I have a full time job so it ain't easy) But I'm curious what you all think about getting a house near your current investments. I'm thinking economy of scale for snow removal and lawn mowing. But is that enough to make it worth it? Probably not huh? 

So October 2013, we close on the house. We took a good inventory of what was needed and our goal was to make the house, clean, safe, functioning, nice, but not too nice. The first floor has hardwood floors almost everywhere. Mostly in decent shape. Let's leave them alone. The walls however are all 70's wood paneling. That has to go..... until we saw what was underneath! The original walls of the house were not plaster and lath as I suspected but actually homasote (or something very similar) with wall paper installed over it. Horrendous and no way to patch and repair, sooooo the wood paneling stays! Our hope was a good coat of paint might make the rooms a little more presentable. Amazingly, the painted paneling looks fantastic. The rooms started to feel clean and new and it give a real "country casual" feel to the house. By the way we went with white, everywhere. Eggshell for the walls, semi-gloss for doors and trim. Everything was clean and bright on the first floor. Pretty simple job. now the second floor, that's a whole nuther story!

This house is a cape and the second floor has three small bedrooms. But it seems like the previous owner had made the rooms himself. The location of walls didn't really maximize the space and none of the bedrooms had doors. Just curtains covering doorways. On top of that the doorways were 6' tall by 2' wide. At 6'4" I needed to duck and turn myself sideways to fit through. That's not gonna fly. Here's what I started with:

The ceiling was also stained and drooping from a previous roof leak and the carpet was nasty. So I began with destruction and found that the walls needed to be reframed entirely. Scraps of wood peiced together, 24" o.c. studs, poor workmanship. So all new walls were framed and installed with real doors and everything!

Under the carpet we found old linoleum on top of the original hardwood. At this point there was no way I was going to pull up linoleum and refinish floors so instead we purchased dark gray industrial carpet. Here's the finished product. All in all, the second floor took about 2 months of mostly weekend for me to complete.

I was really happy with the results. As soon as this was done we listed it for rent. The response was incredible. We had no idea what to expect because it's just a so-so house that's a little on the small side. After the first group of potential renters finished walking through, the told us it was by far the nicest place they had seen. Apparently most college landlords don't even clean their houses. Gross. We had our choice of several groups of students and didn't have a great screening system but we ended up with a nice relatively quiet group of guys. It's worked out well enough that they will be signing new leases next week for next year. 

The reno took more that we expected, though we planned on it being a lot. We ended up spending about 20k for the new roof, furnace, hot water heater, electric service, second floor everything, paint, retaining wall (more on that in another post), plumbing, stove, and I think that's it. For now. It seems something new comes up every few months but we have funds set aside for that. 

Hope this was interesting/useful for you all out there!

@Jamaal Jaynes  Have you considered living in one unit at least temporarily while you rent the rest out? This could help minimize the down payment required for financing and I think a bank would look more favorably on you because it will be your primary residence. Just a thought.

@Rob Caldwell  Thanks very much! Great write up on your profile page. I have a feeling the next house will probably be bought with conventional financing through a realtor but I'm trying to figure out how to build relationships in the area so I can move away from tradition routes.

@David Buell  Thanks so much for the offer! I'm still learning myself but I'm happy to share any information that I can. I'll certainly keep you in mind if something comes up. The learning never ends so I recommend doing as much reading as possible and maybe find someone local that you can work for. Good luck!

Hi everyone, I posted some details about this in the deal diaries forum but apparently that wasn't quite the right place so I thought I'd share a little bit here about my first real estate (investment) deal. Back in 2013 my partner and I were looking for a house to rent near a college. We spent months working with a realtor (because I'm just learning now that you can buy a house without one) and almost purchased one through her but the deal fell apart on inspection. Knob and tube wiring, leaks in plumbing and it was the very top of our budget so no $$$ for repairs. 

Well just down the block from that house was a FSBO. They wouldn't work with realtors so we called, did a walk through and ultimately made a very (cringe-worthy) low-ball offer. The house had been the home of an older gentleman who recently passed away and he house needed a ton of work. They rejected the offer and we continued our search. After a few months, we still had found nothing in the area we wanted so we called the owners of the FSBO again to talk. We had an idea of what the rent could be in the area and we knew we wanted to make roughly $1,000 per month after all expenses were paid. By the way $1,000 was a completely random number that we chose, we had no idea what we should expect in terms of profit but a few hundred per month didn't seem like it would be worth it.

We eventually settled on $145,000 as a purchase price and our bank (didn't know you could buy a house without a traditional mortgage) required 25% down. So our out of pocket at closing was around $44,000 with closing costs. This was by far the most exciting day I can remember. Having been planning for years and saving money and almost a year of looking at houses, I was finally an investor!

Next post up, our reno process! Stay tuned!

@Ryan Bergeron  I stop by the house at lease twice a month. I always have some excuse, checking plumbing, mowing lawn, raking leaves, etc. Since we do all the maintenance for the property ourselves there are times that I'm there once a week though I hope that doesn't continue later on in the future. Smoke detector inspections are a good reason to use for a visit. I have a good relationship with the guys in there and they know to expect me being there at random times. I try to stop by occasionally with little or no notice just to see what the yard looks like. It can be time consuming but I think it's good that they know I'm around a lot.