All Forum Posts by: Erik Andersen

Hello everyone! 

I have a 102 year old house with 7 seven bedrooms and a 3 car garage under contract that I plan on living in, and renting the extra bedrooms. Everyone will share the common areas and the 3.5 bathrooms. My goal is turn the place into a student housing situation and potentially be open to renting month to month. That sort of flexibility will allow me to catch as many students as possible. I've also checked with the city, they are fine with this arrangement.

Now, I'm trying to be as upfront and legal about this situation as possible. I've called most of the major insurance companies about this place and told them the plan and they refuse to write that kind of policy. Do any of you know an insurance company that will write a policy like that? Otherwise, do you know what the legal ramifications would be if I told them I only had a few long term roommates, but I had a lot of short term renters, and I had to file a claim? Also, would that insurance arrangement cause any issues during the eviction process if I had to force someone out?

Any insight or experiences you could share on this situation would be much appreciated! 

Thank you, 

Erik Andersen.

Thank you very much for that spreadsheet @Cliff H.! I really appreciate that summary of data! With everyone's helpful advice here, I will steer clear of a home warranty for this property and just save for replacing it myself/with contractors I hire. I will also hire a property management company to take phone calls and provide a maintenance technician for basic maintenance. 

Thank you all once again!

Thank you both for your helpful replies to my question! @Krista Dodson, it sounds like you had a very unfortunate encounter with a home warranty company! I will make sure to read the fine print about what is and is not covered in any of the policies I consider, and also consider running without a home warranty. @Phil Earley, the lag time associated with home warranty repairs and the associated distress to tenants is a very good point. 

This house is my first purchase and I will live there as well. I plan on using this as an opportunity to observe how a potential property management company handles maintenance requests/work because I see an opportunity to replicate this model. Primarily, I want the property management company to handle incoming calls from tenants and already have a maintenance technician they can effectively support. (I definitely couldn't support a dedicated technician with just one property.) What are the pros and cons of this kind of property management relationship? Would it be difficult to find a quality property management company that would work with me even if I want to find my own tenants?

Thank you! 

@Krista Dodsonundefined

@Phil Earleyundefined

Hello everyone! 

I am purchasing a 102 year old house with seven rentable bedrooms and I will turn this into a student housing situation, where each person rents a bedroom and shares the common area. My question is focused around the pros and cons of hiring a property management company and a home warranty and where would they overlap?

I know a warranty can cover the costs of major systems and appliances failing just fine but I've also heard they perform regular maintenance things like toilet clogs in a poor fashion. That's where I was thinking about property management and for them to handle basic maintenance requests while I'm gone.

Thank you for any knowledge and experience you can share about this situation!

P.S. I'm planning on performing the tenant search and advertising process myself since it is a unique property and housing situation. 

Congratulations on deciding to jump into the real estate game! Sounds like you are well on your way to establishing a solid knowledge foundation. I'm in pretty much the same boat as you, learning and aiming to get into multifamily investing, but I live here in KC. 

I wish you the best of luck and I look forward to hearing how you do in this endeavor!

Hello everyone!

Now this might be a dumb question, but how do you guys go about picking a property management company? I'm just starting out and I will need to work full time until I have enough properties. To start I wont have the time or resources to directly manage the properties for repairs and tenant issues, and afterward I'd like to use the time I've gained toward building the business bigger. Is this form of outsourcing a bad idea? A lot of the material I've seen on this site is in relation to the person setting up and running thier own property management company/systems once they buy thier first property. That said, is it a viable choice to have all property acquisitions managed by the same company you've hired once you've found a found a good property management company?

Thank you, and I look forward to hearing your thoughts. 

Erik Andersen.

Wow! Thank you guys for the warm welcome! 

I look forward to getting to know all of you better in the near future and possibly meeting you when I'm back in Kansas City. Until then, I'm going to keep posting updates to my plans as I learn new tips and tricks. 

I hope you all have a great evening,

Erik Andersen.

Hello Everyone!

I'm new to the world of real estate, but real estate has intrigued me. I'm coming into real estate after 8 years of research experience in various molecular biology laboratories. Learning complex systems and ideas is my favorite activity. Real estate happens to be amazing in the fact that it fulfills that desire, and my desire to create a solid financial future for myself. As a result, I aim to dive in headfirst while working a 9-5 job to acquire the funds I need to start investing. 

Currently I'm living in Champaign Illinois, but in December I plan to move back to Kansas City to be near my family. Once there, I want to enter into the world of real estate by purchasing a small multifamily property. Preferably a quadplex with an FHA or 203K loan. From there I want to build my portfolio up to 20 cash flowing units, $200 per door per month, so I can have $50k of cashflow each year. I can effectively live on less than $25k each year, so 20 units is when I can leave my job if I so choose, and still have $25k to grow the business. I also plan on hiring property management companies to manage the properties since my time will be mostly occupied by a day job. To make this happen I'm educating myself with books written by bigger pockets, reading the blog, listening to the podcast, and as of today I'm starting to analyze deals.

That is my general business plan, but I'm going to continue refining this plan while I read, learn, and get to know people on bigger pockets. 

Sincerely,

Erik Andersen.