All Forum Posts by: David Hald

In February 2021 I replaced both water heaters in my duplex, since tenants frequently complained about no hot water and the units were old anyway. 

Expecting this to solve the problem, I was surprised when the same repair call came back again. I told the PM to send the same installer of the water heaters out to fix his work, which they did. 

To no avail, this problem keeps recurring, and, needless, to say is eating into cash flow in an already high-maintenance cost property. 

The water heaters are in the flagstone basement of a 1900 midwest duplex. Any recommendations on how to keep the pilot lights consistently lit ?

I've had a tenant in place since 12/2019, now PM is asking if another tenant can move in (a friend of current tenant, they say).

What should I require legally from this person, apart from his personal details? Separate lease? Separate deposit? Extra rent?

I lowered rent and negotiated with current tenant to secure her, but part of my will to do so was that she was one person with no pets. I feel I should get something from this adjustment to our original lease, especially because it will necessarily mean greater use/mileage on the house.

Is there something else I'm not thinking about? 

Any thoughts would be helpful!

Please help!

Hello Everyone,

In early December, I bought my first property, a Midwest duplex in a mid-size city. 

It needed a refresher, so I got some bids, and hired a contractor/company, who also does snow removal/lawn care. They gave me an estimated finish date of January 5, 2019.

Some work has been added by me, as the process has progressed, and some delays have been incurred due to my distant location (I'm working in Asia) and starting up a new job with training et. al. here. 

However, on the contractor's end, it seems they literally stop working depending on the weather, since they are primarily a snow removal company. The fact stands that it's now 3 weeks after their estimated finish date, and they still aren't done, although not much remains to finish the house. 

As you can all gather, I have some empathy for their situation, but this delay is costing my hundreds per month in holding costs. I put in a condition in our Independent Contractor's Agreement for a 1% per-day-overage-fee past the estimated finish date, but I am hesitant to bring that up, since these guys still have to finish the job, and I may want to hire them again in the future. Should I simply pay them the reduced amount after they finish? Should I try to negotiate now? After they finish?

What would you all do?

Thanks in advance!

Thanks a lot, everyone!

Hello All,

So I have finally gotten a duplex under contract! I am an overseas investor, as well, fyi.

Before renting, I plan on hiring out to qualified people the following work:

-re-glaze all 3 tubs, repair 2 tub surrounds, replace vanities/mirrors/light/fan/toilet internals in 3 bathrooms

-rip up carpet, evaluate wood flooring underneath, and either refinish it, or put down laminate on top

-repaint whole house inside

-professionally treat both apartments for bedbugs (revealed on seller's disclosure that they were there in May 2018)

-full house clean-out (previous tenants may leave crap behind)

My question is how do I order all this work to happen in the most efficient way possible, so that I don't have to, for example, pay professional cleaners to go through the house twice, or repaint after the tub re-glazing makes a mess of the bathrooms, etc. 

Any tips are greatly appreciated, since this is my first one!

Thanks in advance!

Dave

Hello all,

I am a first time investor analyzing (and will soon have my agent and a trusted family member walk through/video property) a midwest duplex in a midsize town for a prospective buy and hold investment. Neighborhood and up/down duplex are both C class. I have done my preliminary analysis (I think), and I hope you all can give your insight, point out my shortcomings or omissions in calculations, and generally remark on how the numbers of the deal appear. 

Please note, I will not be offering full asking price for this property, because ARV won't reach current asking price + rehab cost. Part of my inquiry is, given my closing costs are low (no loan origination fee), in what range should my maximum allowable offer land?

Here is the info:

Tenanted duplex with 2 2br/1ba units, both tenanted and renting for $600 each.

Financing is via private loan at 4% interest only payments and final balloon payment at end of term (5 or 10 years, tbd)

Asking price : 57,900 ***note: following numbers are assuming the seller's asking price, which I would NOT offer***

Est'd ARV: 60,000

Est'd rehab cost: 15,240

Closing/Legal cost : 1,500

Down Payment : 17,000

Total cost of project : 70,400

Total borrowed amount : 53,400

Total Gross income : 15,880

Total Expenses  : 9,054

Net Operating Income : 5,478

Annual Debt Service : 2,136

Cash Flow : 3,342

Even with the over-market asking price, this property is already cash flowing. However, given the high asking price, I would lose an equity building short-term exit strategy. In fact, if I sold too soon, I would undoubtedly lose money. I don't want to have to depend on appreciation, which may or may not happen. 

How much would you offer? Why?

Thanks again, everyone, for your input. I look forward to your responses!

Hey all,

My woes are multiple, here they are for you.

First, I had two contractors who agreed to do a walk-through and give me an estimate on rehab costs with my agent. Then one of the contractors decided he didn't have time for the project. Then the second contractor never confirmed, and ultimately didn't show up to the walk-through. 

It's ok, I thought. My agent seems quite savvy, and with her walk-through video and commentary, I should be able to at least ask some contractors for bids/know general rehab needs.

After being denied the first proposed walk-through, my agent set up another one. However, upon arrival she couldn't get inside. I don't know the details on this yet, but suffice it to say the tenants of this property aren't going to make any part of this process easy for anyone. There was also garbage piled against all visible sides of the house and in the front yard. The driveway needs repair, as well. It's the ugliest house on the block, but I see value and potential for equity in that. 

I simply can't imagine making an offer without being able to see the interior of the property first. This seems way out of my league as a first-timer. Even making a rock-bottom offer doesn't sit well with me sight unseen.

This is in Iowa, but I am wondering if anyone knows the legal rights I would have if an offer were accepted with these tenants already in place? I know I would have to honor any lease that is already in place with the prior owner, but what I really want to know is how fast and how easily and for how much could I get these tenants out of the property?

Secondly, what do I have, as an out-of-state investor, at my disposal to enable my agent to enter the property for a walk-through?

Thanks for all your past advice, and thanks in advance for your insight with this impasse!

Hi everyone,

Firstly, thanks with all your responses to all my previous posts. You never cease to offer informative advice, calming words, and helpful solutions with every post I make. Thanks so much!

I have asked, at this point, 3 different realtors for recommendations for contractors. I got in touch with two, after trying to contact about six. Unfortunately my foreign number (out-of-state, out-of-country investor) seems to scare most people off from answering. 

I had an estimate walkthrough lined up with my agent and two contractors, and the more responsive and presumably professional of the two just informed me he has no time for this project. 

I would really like at least two estimates, since this is my first property, and I need to have some idea on the range of prices, and prices per square foot. I was planning on getting two for education's sake, and on future properties I will be able to estimate easier, having already gotten the estimate on this first one. 

Does anyone have any contractors (only licensed, insured, and bonded, please) that you would recommend who has done great work for you?

Thanks in advance, again, everyone. You guys rock!

Dave

Wow! Thank you, all, for the helpful info. I've asked my agent, and he told me the seller has no reason to provide the lease until we put in an offer. Another question, is upon purchase of the property, what would my options be for replacing the tenants and/or renovating? Thanks again!!

Wow! Thank you, all, for the helpful info. I've asked my agent, and he told me the seller has no reason to provide the lease until we put in an offer. Another question, is upon purchase of the property, what would my options be for replacing the tenants and/or renovating? Thanks again!!