All Forum Posts by: Curt Bixel

@Daniel Judge yeah, I learned that lesson about the taxes going up.

Years back I had a property go from $700 per year to $3500 per year. I had not even fixed it up yet.

Took me from positive cash flow to negative cash flow for years. Expensive lesson.

I am on bigger pockets to see if I can learn lessons like this a bit more vicariously. :)

I am looking at properties online.  I am looking for long term rental properties in the Columbus, Ohio area that I can purchase at a discount, so I am willing to do substantial rehab.  My plan is to look at hundreds of properties and narrow that list down to a much smaller list that I can really dig into and research.

Given that goal, it would be quite helpful to have some general numbers that I can use for my calculations.  Currently I am using:

Vacancy = 10%

Repairs = 10% or 5% in case a full gut rehab was done.

Management = 10%

Capital expenditures = 10% or 5% in the case that a full gut rehab was done.  

Rehab is certainly more difficult.  Can't even expect to get a good number there until getting into the place and taking a look at it.  Even then, any estimate would still be very rough until an experienced GC actually came and took the time to give an estimate.  That being said, in order to narrow a list of hundreds of properties down to a reasonable number to visit, it would be good to have some starting numbers.  Can I get some feedback on the following?

Older Home (before 1940) (Think Clintonville)

• Full gut, rehabbed as a rental = $70 per square foot.
• Moderate (kitchen and bath) + light other, rehabbed as rental = $30 per square foot.
• Light rehab - $15 square foot.

Newer Home (after 1950) 

• Full gut, rehabbed as a rental = $60 per square foot.
• Moderate (kitchen and bath) + light other, rehabbed as rental = $20 per square foot.
• Light rehab - $10 square foot.

Water = $25 per bedroom per month

Taxes - check comps on auditor's website

Rent = Rentometer.com

Any feedback would be much appreciated.  Especially feedback specific to Columbus.  

Thanks for your responses.  I was a bit surprised by this, as I had thought that the best way to go would be to get a really top notch lender who would not only give great rates, but could creatively solve problems when it came to refinancing, with the motivation for this being they would hope to earn repeat business.  

It sounds instead like casting a wide net and letting the lenders fight to get your business each time is the best way to go.  

I am going to start making calls today.  :)

I am considering pulling some equity out of my primary residence as well as some rental properties in Columbus Ohio. I spoke with a local bank today that offers a great rate for a HELOC, but I would really like to lock in a low rate for a long time.

I was surprised that the cost for a cash out refinance was so much more than a simple refi. They said there are an additional 8000 dollars of cost for a cash out refi.

I wonder if anyone knows of some better options.

On another note, a few years back in 2012, I had difficulty getting refits on my investment properties because I had 4 of them. A lot of the banks told me that once you own more than 5 properties, they cannot loan to you.

I have a few things going for me including a steady job, years of solid positive cash flow on all of my rentals, and a credit score of 800+

Any advice you might have would be much appreciated.

I actually did rent to a tenant like this a few years back.  They just moved out.  They left with two months unpaid rent, and the place was trashed.  I must be soft, because they still made me feel bad about asking them to leave.  

The worst part is now the next landlord is calling me because this tenant put me down as a reference.  

I think the best way to look at it is that if you allow someone who is not a good fit to rent your property, you are enabling them to live beyond their means, and thus, in a way, are responsible for them getting themselves into financial trouble.  

I find this to be a better way to help myself make the right decision rather than to call them disrespectful scumbags who trashed my property and stiffed me for rent. 

In any case, take a pass on this one.  

I have a tenant who I had to ask to leave after months of failure to pay rent.  I made the mistake of being nice.  I have learned my lesson and don't really need any help on that aspect going forward.

What I do need help with is what to say to the next landlord who is calling me, as this tenant has now put me as a reference.  

What I would like to say is that, no, I would not rent to them again.  When they finally did leave, they were 4 months behind in rent, and when I did go into the property, it was in terrible shape.  The amount of work I had to do to get the property ready for the next tenant was extreme, took two more months of time to get done, and resulted in 2 more months of missed rent.  So, not only would I not rent to them again, I am actually quite sorry that I ever rented to them as instead of having the property be profitable over the given time period, it was quite negative.  

The advice I need is as to what I can and cannot say to the next landlord without getting myself in trouble.