All Forum Posts by: Cherie Ganesh

Just be aware that you'll have to file Arkansas income taxes. Just sonething else to add to annual property cash flow projections on your investments. Their forms are online so you can print one out, put in your last year's total US income tax data and then input projected income from real estate in Arkansas. Then you'll have an estimate to add to expenses. 

I sent you an invitation and some info. 

The only way to get good pricing is to do a lot of the searching either on your own or with a broker who understands the market and your yield needs.  Have you looked on Realtor.com to see what is on the market now and what may be lingering on the market.  In Mississippi it's hard to easily get sales comps due to their non-disclosure laws for real estate sales so a good local agent would be a great benefit.  In Memphis, I can search the recorded deeds and see what properties have been selling for in areas of interest. This takes some computer time but once I start monitoring a specific area I keep a spreadsheet of all listings, sale prices, basic info on the property and definitely flag those that have been fully renovated.  The only other way to find lower prices is to do a lot of calling owners or work with an agent who works that area and is usually canvassing owners in an attempt to get listings.  Good luck whatever you decide to do.

Be sure to add into your landlord costs the state income tax you'll have to pay on rental income for houses in Mississippi. It's not a lot but every little bit counts on residential rentals. Tennessee has no income taxes.  

Cul-de-sac properties definitely have less street noise and typically few outsiders driving around.  I'm not sure how much more a tenant would pay for that.  In some areas, pricing overrides exterior amenities.  However, parking can be an big issue in a cul-de-sac unless there is enough paved parking area onsite.  I have had to put a limitation in our leases on how many cars the tenant(s) can have even if house is on a regular street and create a restriction on not parking on the lawn or unpaved areas and can't park construction trailers onside unless in back yard.  If they do park in non-paved areas of front yard or on the street and code enforcement sends us a notice and a potential fine or environmental court appearance, the tenant has to pay for all costs to satisfy the code issue.  If they don't pay, it creates a lease default that they need to remedy with us. It's amazing how quickly they find the money to not lose their lease since our properties are typically a little less than market priced and we treat our tenants right.  We self manage all of our properties.

In addition to Curt's comments, you need to get a good handle on what a realistic rent is for the specific property. There is a large variance in market rents throughout the greater Memphis area which means you may need to pay for a market analysis if you don't have a way to determine that. There are turnkey houses on the market that have a list price higher than what rents in those areas will support. Make sure you have confirmed all holding costs yourself and plug in an increase in both city & county property taxes that will occur most likely the year after you close on your purchase. Lastly understand the demographics for the area surrounding your potential investment so you can create a correct risk analysis and how much rehab you may have to do when tenant leaves.  Hope this helps.

I have a couple of my houses in 38122 that have no place for either washer or dryer without adding onto the house. The rents on those are about $50-75 per month lower than homes where furnace has been moved up into the attic space and that closet converted with plumbing etc been added for a stacked washer dryer. There are three laundromat within about 6 blocks so they use those.  If we ever fully remodel those houses we would move all HVAC to attic and create a laundry area. Our tenants for those two houses have been there over 5 years and will most likely buy their houses in a few years.  If they leave, we'd probably update the house since both market  rent and sale prices are rising in our area. 

My husband and I have developed relationships with folks we use but we haven't needed a general contractor. Over the years we now have electrician, HVAC, plumber, roofer, drywaller, and a general maintenance guy who takes care of stuff not requiring a license.  Finding a good HVAC person was hardest. Husband actually went to two HVAC classes so we wouldn't keep getting screwed.  If you're planning to flip, you probably need a GC. You might stop anytime you see a house having major renovation and see who GC is and what the job site looks like. A good GC would have multiple trades working at same time and site should look pretty clean. I spent years in store development for a retailer and met many GC's overy the years and got pretty good at walking onto a job site and seeing if GC was doing his job or not. 

It's hard to know why they are lingering on the market without knowing where they are located. There have been many houses in low income areas purchased by investors who may have never spent any time in the market. After purchasing they may have found that they couldn't afford to do many improvements to increase the physical value and flip the property for a profit so just rented for an acceptable price. There are many areas where rental price upside may not be high enough to provide an adequate ROI to the investor if he does many improvements. So now they may just be tired of fooling with the properties and want to bail but don't want to sell for anything less than they purchased the property for so it lingers on the market.

Definitely drive the area and determine if it's an investment that fits your needs and experience with low income housing. You may need to be prepared to collect rent every month in person or hire someone to do it.