All Forum Posts by: David B.

Hi Dan,

I’m also in Grand Rapids and also got my start with a condo as a rental. There’s a Meetup of GR investors once a month at Buffalo Wild Wings on 44th. Maybe I’ll run into you there? Always happy to connect with fellow investors. Best of luck!

David 

I've seen 100% LTV in my area but at higher rates, and certainly not all banks are offering that high of a limit. When I called around, several banks won't go higher than 80-90% LTV. If you're in need of that much, even higher HELOC rates are still pretty reasonable as compared to hard money anyway.

Best of luck!

Hi Paul, Your story sounds very familiar! We moved to a condo we bought in GR in 2014, and we turned it into a rental in 2015 when we moved to Rockford. I agree that the deals are tough to find, but I'm still seeing a few here and there. Best of luck in your search for your next property!

David Bright

I love the 2/1 option in my market. The CapEx and repair budgets can be lower because it costs far less to do roof/paint/flooring on a 650SF ranch than a 1650SF 2 story. In different parts of my market, then additional jump in rent from a 2/1 to a 3/1 is hardly worth it for the extra cost of acquisition, and there is still plenty of demand for a 2/1.

If this is an investment, then it’s all about the numbers in your local market. If the numbers locally make sense, I wouldn’t let a 2/1 scare me away.

Best of luck!

You mention that one of your goals is to learn about the rental process. From my experience, it's easier to take the plunge into being a landlord by renting out a house that you already own than by buying a house to rent out. The math may not be better from a return on investment standpoint via your approach, but the learning experience and momentum you will get from diving in can be great. 

That doesn't mean that there won't be issues (repairs, upkeep, out-of-state management...), but it may still help to drive some serious learning!

If experience as a landlord/owner is part of your goal, keeping this as a rental could be a reasonable move to consider even if the math isn't awesome. Personally, it was way easier for me to not sell a former residence and try being a landlord than it was to go out and buy something and take a big risk. I learned a ton renting out my previous residence, and that education might be worth something even if this isn't a cash cow of a rental. I don't know your specific market, but if renting this for a year or two will help give you the confidence to jump in to purchasing other properties, I might be tempted to give it a shot. 

Great input - thank you all of your help! I'm going to listen to everyone's wisdom and pass on the deal if I can't get an inspection first to hedge my bet. Thanks again everyone for your advice! 

Not sure about the type of basement walls until I get inside, but I don't think theyre' block. There is a basement, but it's common around here to have a 6' basement height, so it doesn't always technically qualify as a basement. The structure has cellar doors to the basement level. Its bank owned currently, so I have no idea about flooding history. The price is good, but a $5-10k foundation repair might tilt it far enough in the wrong direction. In looking for other structural problems, I'm looking for things like cracked drywall, floors that aren't level? Anything else?

Thanks!

David

Hi BP Community,

I'm looking at buying a house that I would like to use as a rental. On the upside, the price is right for it to cash flow nicely, and it's only 5 minutes from where I live. On the downside, it's 100 years old, literally. Someone did some work on it only a few years ago (new cabinets, counters, roof, siding), but I'm worried about the foundation (pics below):

Several of these cracks exist, and some are filled in (like picture #2). In a 100 year old house, do I expect this, or do I run far, far away? 

I can't get in the house until tomorrow, but when I do, what should I be looking for to get a better idea of the extent of the problem?

Thanks so much!

David

Hi folks, Thanks for the replies! I should have been more specific - only two bedrooms (250 SF) of flooring (cheaper carpet) was needed, and paint only as touch-ups and maybe one room (I'd do that myself when I cleaned up a few other things on a Saturday). That's how I came in with a lower repair figure. 

Problem was even waiting through the end of the day and posting the question was apparently enough "analysis paralysis" and I missed the deal - I later learned that it sold the same evening that I posted the question. 

That being said, I appreciate the responses to help me validate that I'm moving in the right direction. Hopefully this will help me pull the trigger faster next time! 

Thanks again!