All Forum Posts by: Edward Barnes

I'd agree. Seems like most realtors in Hampton Roads go with 1% for pricing.

More experienced investors can speak to this, but LLCs seem vary by state as far as what protections they provide and the difficulty and expense in setting one up. Seems like they more worthwhile in  landlord-friendly states and less valuable in tenant-friendly states.

sure can

There's a great podcast on college rentals, #140 with Billy Syrios. I don't have any experience, but, sounds like a lot of it depends on the zoning in the area, if you can rent out a house per bedroom and get the parents to cosign sounds like you're in pretty good shape with a great ROI. Also have one "house captain" who's the point of contact so you don't have to deal with each individual renter. Also, you're going to have to budget for landscaping as no college kids are going to maintain the yard. All the units turn at the same time of the year, so if you don't fill your units during that summer time window and the fall semester starts you might be dealing with some vacancy for awhile. I'm sure there's a lot I'm missing, been awhile since I listened to it, but listen to the podcast, it's all in there.

See what rents are in the area for comparable properties...rentometer.com, mapliv.com, hotpads, whatever you wanna use. As a starting point, use the 50% to estimate rental expenses and see what kind of numbers you come up with.

Highly recommend BP Podcast #140 with Bill Syrios as was already stated. I'm just regurgitating what was covered in that. But you're gonna have to pay for landscaping, college kids aren't cutting the grass. Common areas aren't as important as bedrooms which are what the college kids care about, and of course, more bedrooms equal more money. Obviously zoning's a big part of this. There's also windows throughout the year where you're gonna have to scramble to turn your units because they all turnover at the same time and if you don't get them rented out in time, school starts and everybody's already settled in to places. You might end up waiting a semester.

You're not including maintenance, capex, and vacancies. I really wouldn't worry about what he paid to build it, doesn't really have anything to do with what it's worth to you. Doesn't look like it makes any money, sub 1% deal.

Generally govt loans such as VA that are designed for owner occupants expect the buyer to occupy for at least year, so 6-8 mos wouldn't work. Sounds like you have pretty healthy reserves, but I would wait for the dust to settle after you start your new job.

I'd say stereotypically what you'd expect to find outside a military base: strip club, tattoo parlor, liquor store, used cars. :) Then you also have to contend with jet noise in Hampton Roads. It really doesn't live up to the stereotype though. You wont find any "A" areas near bases, but usually "B- - C". But military members are well compensated. A 22-year-old E-4 makes roughly what a college grad at an entry level job makes, $45-50K/yr, around what the median household income in the U.S. is ~$51K. Furthermore, your E-4 really has a lot more take home pay because they don't have to pay for medical benefits, retirement, life insurance, etc. and much of their compensation (think Basic Allowance for Housing or BA for Sustenance) isn't classified as "pay" and therefore it's not taxed. Typically your "poorer" lower ranks, E-1 - E-3, live on base anyway in dorms or barracks, depending on capacity. Of course, when you get into higher ranks and officers you're talking more money and looking for good school systems for their kids. 

As far as culture that would attract millenials, Hampton Roads has military bases, shipyards, ports, shipping containers, etc. Very "industrial" feel to it. A military area with some colleges in it. Not saying there's no culture here. There's some cool downtown areas, historical sites, and event venues, but definitely not a millennial magnet. Military's not going anywhere, it's a natural deep water port, but they could trim around the edges. Not even sure what goes on at Ft Eustis in NN, but I know it's small and have heard it referred to more than once as "Ft Useless". Good old Wikipedia, says 50% of the HR economy is connected to DOD and another 30% to other "federal sources", like NASA, Jefferson Labs, Veterans Affairs, etc. So that leaves 20% not coming from the federal govt.

I know in Norfolk it's considered "non-conforming use" even if zoning changes assuming the use isn't discontinued for a period of two years. So I can buy a duplex in a single family zoned district and, assuming it's been used as duplex in the last two years, I'm still complying. Could just be grandfathered in. But all zoning is local, as are the definitions. Length of time in your area could be shorter or longer, etc. Zoning ordinance is usually online.