All Forum Posts by: Cheryl Hewitt

In a previous life I used to show/breed dogs and spent quite a bit of time in hotels and venues with dogs. Here's the thing with dogs; they are apt to mark a place that is new to them, especially if its been previously marked, or if there are other dogs that they are not familiar with (i.e., another guest also brings their dog). With STR this could potentially be more of an issue due to the short turnover than what it is with LTR.

Thanks for all the feedback, very helpful. I submitted a loan application for a second home. Hopefully I'll hear something back on Monday. 

I'm interested in purchasing a vacation home (second home) that will be for our use, but also short-term rental when we are not occupying it ourselves. The property is 88 miles from my home. I estimate that we'll occupy it between 14-30 days per year. 

I am getting mixed information on different sites as to whether this would need to be financed as an investment property rather than a second home.

What percentage should I expect to put down? 

Will I need to have reserves to cover 5-6 months of payments? 

TIA

As someone who spent a week in the Tomahawk area this summer at a VRBO lake rental, it was really wonderful. The city had nothing much to offer, but we weren't looking for that. The place we rented on Lake Alice had 4 kayaks, 1 paddle board, and a Jon boat included in the rental and we chose this place for that reason. The house was lovely and well appointed. It was situated well for privacy and lake frontage. This year may be an outlier in our lack of interest in doing touristy things due to the pandemic. I hadn't considered that temporary influence until Scott asked why Tomahawk. After some reflection, I can see his point why some areas may be more attractive to vacationers than the Tomahawk area. 

Scott, what is your opinion on lake properties west of the Oshkosh area? I'm interested in a property that is close to Nordic Mountain. 

@Scott Schultz, thanks for all of the questions and input.

The insurance is part of the P & I. However, I guessed at the figure. What amount would you say is reasonable? I totally overlooked dumpster, and I agree that the lawn/snow amount of $120 is weak. What amounts should I plug in for those? What about pest control?

What is a purchase discount?

"...but how much more will it be worth after that unit is updated and rented?"

            I don't know how to calculate that. 

Mortgage type: can I go with a conventional mortgage instead of commercial? If I can get a 25 or 30 year amortization with 25% down, then I won't need to be concerned with renewing in a downturn, correct?

@Joe Seegers, thanks for the calcs. I used the BP report tool and it calculates that the return is 19%. However, I can see where I will need to adjust some numbers to get a more accurate projection and this is why it's so helpful to get input from all of you. :) 

Thanks for reminding me to ask for three years of their schedule E. 

I hear you about the distance and that's why I feel I'll need a property management company. It's hard to see that cut into income, but it's probably a necessary evil. 

The price in is the report which is linked at the top.

View report

*This link comes directly from our calculators, based on information input by the member who posted.

I found a property that I believe sounds good on paper. I have not seen it in person yet, as it's over an hour away. It's a single-story, brick 4-plex (8 beds/4 baths) with full basements, that was built in 1987. It's in Illinois, and I'm in Wisconsin, so I'd need to hire a property management company. From the pictures, the place looks to be in good shape. Three of the four apartments have new stainless appliances, flooring, and fixtures. I do not know the age of the roof, HVAC, etc. I have used 8% capEx and 5% repairs, and $10K for repairs (updates to 4th unit) and will adjust after seeing the property - if it gets past this initial phase of number crunching. For the rental income calculation I used HUDs fair market rent for this city. 

Additionally, this property is 7 minutes from the Wisconsin-Illinois border. Recreational marijuana will be legal for all adults in Illinois beginning on January 1, 2020. I'm unsure if, and how, this may impact real estate properties.

To date I have one SFH and I'm looking to expand into multifamily buy and hold.

At this point I'm wanting feedback on how realistic my numbers are or aren't. What am I sugar coating? 

Some pictures of the property: 

TIA,

Cheryl

Good morning. The realtor sent me the real estate condition report, which did verify that the house has asbestos and lead paint, and lead pipes, and a myriad of other issues. The report included an estimate for repairs, excluding plumbing, HVAC, and electrical and some other key components like updating the interior including bathrooms and kitchen, the amount came to $139,549.35. I'm walking away from this one. It's just too much, especially for someone just starting out in REI.

@Justin Woodworth, I will. 

@Jeff Cichocki, okay! The house was built in 1923, but this appears to have been added in a later update and I don't know when that would have been.

I didn't realize that ignorance would cover this. That's good to know and really frees up the options. Thanks!