All Forum Posts by: Chris Eaker

@Alex Craig

Thanks, I'll be sure to check it out. Yes, there is Knox REIA (www.knoxreia.com). I am not a member because it's too expensive for me right now.

I just ran the calculations and I am actually surprised that my properties are pretty close and one is actually right at 1%. So I guess I will eat my words and say it's possible in Knoxville.

1. For my Fort Sanders student condo, it's 0.96%.

2. For my Bearden SFH, it is 1%.

3. For my Lenoir City duplex, it's 0.92%

4. I can't calculate it for my Powell condo since it was purchased 15 years ago as my wife's residence, but it currently gets $775 and is going up to $795 on June 1. They're selling for around $80k-85k, so it's slightly below 1%.

I'm looking at a duplex now that I could get for $100k and market rent is $625/side, so that would be 1.25%.

I've never understood the 1% rule because I know of very few places in Knoxville that that would actually work. Where in Knoxville can you get $1,000 rent on a $100,000 property? I just don't think that works in Knoxville. Maybe that works on a duplex, but not a single-family home. I analyze every property separately to make sure the numbers work and none of my properties meet that rule but the numbers all work for me.

You will need to evaluate how much more rent you could get for a 3/1 vs a 2/1. One drawback though is you lose the garage, which for many people is valuable. Is the extra rent worth the cost of closing it in? Garages usually aren't well insulated, so you'd have to do that to make it heatable area. If this were in my market, I'd just leave it as is.

I'd buy the duplex over the SFH with a MIL suite any day. Then you can rent out both sides. MIL suites aren't usually separately metered, so it would be harder to rent it out separately.

Hello and welcome to BP. I am not in your area, but I wish you best of luck in your quest.

@JaNae Anderson

I live in Knoxville, TN, and it's a nice market to invest in. Our prices aren't so high that it's hard to get a deal without buying at a deep discount, and the rental rates are good. We would love to have you here, but I would recommend that you not invest from afar. If you want to invest in Knoxville, then by all means, come move here and live here. Then you get to know the market and it becomes your local market. Plus, we have great sweet tea.

When a rental property is foreclosed on, do the leases get wiped out or do they remain in effect? 

@Douglass Benson that's how things work most of the time. Being prepared to move on a deal when it appears is the key. It all looks like luck to an outsider, but it take a lot of preparation to be ready to execute when the opportunity arises. 

Are these properties managed by a professional property manager? Did you partner with money partners/investors on these (besides your brother-in-law)? 

I have rentals in Powell, Fort Sanders, Bearden, and Lenoir City. Each has its benefits. You can make money in any market if you buy right, but certainly some are easier than others. If you're interested in long-term buy and hold and want stable tenants, then buy in areas where families are most likely to live, as opposed to Fort Sanders where it's predominantly students. West Knoxville, South Knoxville, Fountain City, Karns, Halls, Powell, Corryton, etc, would all be good areas. As for financing, I've dealt with a local mortgage broker named Lou Browning at Summit South Mortgage on a couple of occasions and also dealt with a small community bank out of Middlesboro, KY, called First State Financial on a few occasions. I like them both. Lou will be able to provide a solution for almost any situation. First State Financial is easy to deal with and flexible on terms and they offer portfolio loans.