All Forum Posts by: Derrick Lubomski

@jim k. No worries Jim. My plan was build the garage first, then frame in the divider wall so it could be removable. Maybe I should just build a 3 car garage because I agree, having the extra storage is always nice

Hey @Megan Hirlehey, the garage would be in Crafton less then half a mile away from the busway that takes you into town. I've search Craiglists looking at storage for rent and there were quite a few garages in the area with people asking that much. I figured with a new garage that has an electric door, that $125 would be achievable. Most of these garages I saw for rent were your typically Pittsburgh garage that you could barely open a car door in once your vehicle is inside. To me, $40 sounds very cheap, I paid more then that for outdoor storage on a fishing boat before.

@Jim K.area is Crafton. As for plans and building permits, that won't be an issue. I'm a civil engineer who has been part of teams that managed the construction of 40+ million dollar buildings. I already have right of way/easment information from the borough and know my property line offset. My buddies, are all professionals in the industry, the concrete will be poured by friends who do this on a daily basis, and the electric will be done by my roommate who is currently an electrician in the union. No need to worry about a half a** garage being built

Hey @Steve S. by divide I meant build a physical wall between the two garages, no way would I ever consider having an open garage in letting someone use a side for the reason you just mentioned 

Alex R. I should be able to build it for under $8,000. Mostly material cost, I plan on doing most of the labor myself aside from having a few friends assist with pouring the concrete pad and foundation. And yes I’d only use one side of the garage while living there then rent the other. Once I’m moved out I’d rent both sides out. As for location the duplex is just outside City of Pittsburgh limits

Hey BP members, I'm in sort of a predicament that could use some outside input. 

I'm closing on my first duplex for me to house hack in two weeks and can't decide if it'l be worth it for me to build a detached garage or not. I have a ton of tools in storage that I need to move in; welder, air compressor, wood working tools etc. It has a large basement I can put everything in, however rebuilding and flipping motorcycles and cars on the side is a hobby of mine, which I can't really do in a basement.

Now I only plan on living in this duplex for 2 years at most before I refi out of the fha loan. In the meantime I'm going to pursue more rentals using the brrr technique and hard money lending. 

For the predicament...

I see the garage as potential for extra income, I'd put a divider in it so I can keep one side for myself and rent the other out for around $125 a month. When running roi though I'm treating it as if I were renting both units out for 11 out of 12 months at $125 a side. The investment is paid off in year 3 then after that its nothing but straight cash money on top of raising my property value. Typically this would be a great investment, but I'm only 25 and trying to work towards financial freedom, so would my limited cash be spent better towards my next rental? As I stated I intend on using hard money to acquire more rentals, which the lender I have been talking with will lend 85% of purchase cost and 100% of rehab cost up to 70% of ARV. So I'll still need 15% of purchase cost and interested up front.

Typing this out it's starting to come more clear what I think I should do, but what are all of your opinions?

Thanks!

Derrick

@Brent Coombs I'm not solely stuck on this property, I check the market first thing every morning for new listings. Have toured a handful of them and either the numbers don't work, bad foundation, located in the 100 yr flood plane and require flood insurance destroying cash flow etc etc. 

And I'm not attached to it for my the time I've spent, which really hasn't been that much,  would just check in every other month or so while analyzing other properties. Just out of all the places I have looked at, this is the only one I personally would want to live in. I don't think I'm special, but I don't know what the other people purchasing these deals at 1% are thinking either or their goal of the property was. Maybe they never heard of BP, maybe they didn't take into account expenses and they think a good deal/cash flow is any rent over the mortgage, who knows.

@Joe Splitrock The neighborhood is very street by street, the duplex that sold for 229K is closer to the "higher class" area of town, has an additional 2 bedrooms (400 more sqft ) and central ac, all things that result in higher rents. So I just don't see it as being worth 229k. 185k yes I could see it being worth that. I wouldn't say I'm unhappy, I'm just thinking about future deals and maybe just being over cautious as I don't want to invest in a bad deal and have it slow my growth when it comes to building a future portfolio. 

@Mark Ferguson I know I will live for cheap, however I am also trying to stick with my 3 year plan of doubling my doors every year. So I have to think about where I'll be a year from now when I go to refinance, will I of built enough forced appreciation with upgrades to have 20% paid off to get out of PMI while also being able to pull cash out to purchase another property? These are the questions that have me stumped on if I want to pay that much..

@Edward B. I guess where I'm getting at with the purpose of this post is, is buying a property with the rents a little over 1% of purchase price a good first investment? And will it delay me with getting started with future investments?

@Randy E. what part of Durham are you in? I had spent the last year or so down there for my company doing the renovations to the old court house on East Main St. 

But you have a point, I know this won't be the smoking deal I'm looking for, but it has everything I want, I guess I could of shortened the post by asking is buying a property at the 1% margin a good first deal or not?