All Forum Posts by: K W

There are many ways to earn LEED points, from solar heat to indoor air quality improvements. One company I have dealt with is Steril-Aire. They manufacture UVC lights that are installed in the air handling system.

These lights clean the coils of mold and bacteria, making them run as new which saves on electricity. Also, because the coils stay clean, there is no need for chemical cleaning, which is better for the environment.

Originally developed to improve indoor air quality (which they do!), these added benefits of energy management and in some cases, water reclamation, makes them an important part of any LEED certified building.

Many products are on the market now that can help you earn points; Steril-Aire is just one example.

Great, that helps a lot, thanks! I've never used an appraiser on my own, only when getting a loan. it's good to know I have that option.

Thanks Scott. Regarding this statement:

"just be 100% sure you pay for the value check or desktop or full appraisal on the investment "

What do you mean by value check or desktop? Are those other ways to determine the value of a property?

A home nearby recently sold (a regular sale) and the appraisal came in a full $100,000 less than the sale price, so the whole deal fell apart.

I guess what I am worred about, is when I buy a property I want to be sure I don't offer any more than it will appraise at. I don't want to spend $500 on an inspection and over $400 on an appraisal if the deal won't close.

Looking for suggestions - thanks!!

We are in the process of refinancing our home to combine a first and second at the lower rates. We are in a mountain resort area in California and based on things I'd seen around town, thought our home would appraise for $350-375,000. Shock of our lives, we got the appraisal and it was only $280,000! We felt it was wrong, so we paid another $400 to get it reappraised - - came in within $5,000 of the first one!

We still qualify for our refi, but it makes me wonder about the appraisal process in general, and the values of the properties we are looking at buying.

We are still watching for the perfect 3-4 unit property. Has anyone had any trouble getting their appraisals to come in at their purchase price?

My lender said the government started new appraisal rules on May 1, and the lenders are no longer able to communicate with the appraisers. There is now an intermediary company, so of cource the appraisers are making less and we are paying more.

What's your experience with recent appraisals in the market?

Thanks!

There are groups you can join such as www.reobroker.com. I believe you pay an annual fee and you'll have access to hundreds of asset managers across the country. These groups hold meetings have networking events, etc, to further extend the benefits. Not sure what it takes to join, but it's worth checking out.

"The way that you've worded your question makes me wonder whether you're really suited to being in the rental property business."

....and this is exactly the problem. As much as we've researched, qualified, etc, that's my concern. As a long time business manager, I know I'd do a great job at getting everything up and running, filling the building, proper screening, paperwork, etc. But my problem is in my "helpful" personality. I'm just afraid I'd be too soft on tenants and I'll be taken advantage of.

As much as it would be a business for us, I know myself, and the more I read about boyfriends moving in, sob stories about job loss, etc, I just don't know how I would handle kicking people out. If I had a tenant who's husband was in a horrible accident and she had no other income and little kids and no where to go, would I be able to evict her? Knowing me, I'd go into "help" mode and try to solve all her problems.

It does help to know that the 50% rule covers most of the potential "trashing". I wasn't clear on that.

We are just trying to project our profits, weigh the potential losses, and see if it's worth our while. Again, you guys have been fantastic at answering my questions honestly - that's what we need.

Kathy

Some questions for those of you already involved in this business:

1. How many hours per month do you estimate you spend managing your own property? (example: one 4plex)

2. What percentage of your tenants stay at least one year?

3. In your career, how many times have you had to sue someone or go to court?

4. What percentage of your tenants have trashed one of your units?

5. Describe "trashed" and the cost to repair.

Okay, I think that's it. We've been approved for a loan, but we are still hesitating about actually getting into this business. You all have been really helpful and I look forward to your answers.

Kathy

Great, that's what I was hoping. Thanks!

I've been using the Property Analysis sheet provided by this forum to analyze properties. When you say a property cash flows, and you want $100 per month per unit (in general) are you looking at the line "Cash Flow Before Taxes" or "Taxable Net Income"?

Okay, don't yell at me. I know we're not supposed to estimate appreciation but....

We are still reviewing multiple properties and trying to decide whether to buy or not. All of these properties cash flow, all are in southern CA. Cash flow is not as high as in other states, but even using the 50% rule we are getting cash out plus the tax benefits of owning the property.

We expect to buy and hold one 4plex for 10-12 years. I think it will take a few years just to stabalize the housing market, and when it does begin to rise, it will go up slowly.

Is anyone out there using any kind of appreciation estimate when they consider a purchase? If so, how much, what areas, etc?

Thanks!