All Forum Posts by: Chase Gochnauer

Fannie Mae remodels all of their foreclosures before they sell them, Kilim Beige SW I think with white trim, and some standard carpet. 

I wouldn't think of an hourly rate of the first couple years of your B&H being a reliable metric. That to me is the point of the B&H, is that you don't make all of your cash initially. In order to calculate your hourly rate on the B&H, you'd really have to wait until you sold that property, whether it be 1 year or 10 years later. Only then would you be able to have a reliable hourly rate. Over a 30 year period, you'd have 30 years of appreciation along with zero mortgage, and increased rents. If you averaged $500/mo cash flow over 30 years($180k), and lets assume initial purchase was $150k, and now it's worth $300k. That means you've gained $480k in equity/cash flow over 30 years. If you spent 3 hrs/mo on that property, then that equvilates to $444/hr. Pretty damn good.

Thanks for your response. I'm glad to hear a little confirmation that others have been successful doing it this way.

If either of you wouldn't mind sharing, what kind of business structure do you have setup? Meaning, the job roles you have? Example, I was considering a project manager role, basically in charge of the initial rehab and "get ready to rent" services including passing rental inspections. Then a property manager role in charge of renting and day to day tenant issues. I think I could get the project manager role busy right away but the property management role would take a little time until it was a FTE. But, we can utilize them in our other business until then.

Thanks

Chase

Amol, I am not a property manager but am located in Des Moines if you need any other help.

Thanks Jay. Yes I agree "systematizing" something, in house with control as you said is the best way to do things.

I have purchased a few from the local sheriff sale, and will continue to do that. There are deals there in every class. I plan on keeping everything local for the time being, there seems to be enough to satisfy my appetite.

What class are your properties primarily in?

Hello all,

I own a small business with 18 employees in a real estate related field. I'm very familiar with buying/selling real estate. I've dabbled in it, flipped 5-8 houses, been a real estate agent, and had a couple of rentals over the years. I'm considering buying, rehabbing, renting properties as a diversification to our main business. I would be hiring a full time position to help manage the rehab of these properties, and look for a third party management company to do the management. I will have a good line of credit available to purchase a lot of properties, considering the neighborhood of 2/month. I like the class C type property area. I've found I can consistently buy ~$30k properties, rehab for $10k and rent $600-$700. I've seen the discussions on here about that price point of properties. These houses are built in 1920s-1950s, 800-1000 SF 2/1 and 3/1s.

I'm looking to hold and rent to create a different income stream than my primary business. It is doing well, but looking for a little diversification.

Are there any others out there that are purchasing these in more of a "systematic" method like this, or have in house staff to help with purchasing and rehab? I've considered keeping the property management in house and hiring a W-2 employee to help with the management.

Thanks!

IMHO, do whatever is necessary to delay to Monday, find an attorney and pay them to assess the situation. Paying an attorney a couple hours at $200-$300/hr might be worth every penny. How much per month is this rental? Testing probably won't be instantaneous as they'll take air samples and send them off to a lab which will take a couple days.

Get them out!! These guys sound like a nightmare.