All Forum Posts by: Derrick E.

Hello Everyone,

I just wanted to finally stop the lurking and post. I actually might have made a few posts years ago on here, but I've been reading this board for years.

Up until this point our only investment experience is when we bought a chunk of land and sold it for a profit. More luck than anything else, we had planned on building a house there.

Anyways, we just had an offer accepted on our first rental investment. We are planning for this to be a long term SFR.

We will be getting a home inspection completed. We already know it has an estimate of $10,000 worth of work to do in the basement. The seller had an estimate on the repairs done just a few weeks ago. The house was built in 1954 and there is some water getting into the basement and there is a small structural problem in the basement area that has caused one of the walls to bow a bit.

I plan to have it checked out and ask if this is just something that this house with old age did years ago and its been the same ever since, or is this something new that is getting worse each day and needs to be fixed. Or would some of you guys just say to suck it up and go fix the issues now?

We had an all cash offer of $30,500 accepted just a few hours ago. It isn't the best neighborhood in our area, but it definitely isn't the worst. This is a 3BR/1BA, 1,300 square foot with a decent little fenced in yard. It's a corner lot right across the street from a nice day care center. The street neighborhood has a couple houses nicer than ours, some comparable houses, and a few that are run down and/or condemned. 

We expect to get somewhere around $800/month in rent. Property taxes are around $400/year, and I'm not sure what insurance costs.

Looking at those numbers, do you guys think this is a good deal? $30,500 purchase price all cash, expected rent of $800/month, property taxes $400/year, no idea on insurance. $10,000 in repairs.

Ok guys, I have a big question. I hope I have this in the correct topic area, if not feel free to move it to the proper place.

I searched the forum and didn't find anything specific to my question so here goes....

I have some money to invest, and want to get in the game of buying and holding/renting. I also have some other stuff going on and can't have my liquid assets tied up for very long as I will be using it for other business ventures.

I found a property where the asking price is below market value, but it does need some cosmetic work, nothing structural or important. Could be rented out right now, but I would like to do some updates to it. Asking price is about $10-15k below market value before these updates, depends on the deal I can get by purchasing with cash.

If I purchase this house with cash, how long would it be before I could basically take out a loan against the house? I think this is called a cash out finance? Also, will the bank give me 80% of the appraisal value? Meaning if the house is worth 100k, I purchase it for 50k. Could I then turn around and do a cash out for 80k, and basically make 30 grand in liquid?

Just wondering if I am understanding this correctly. If this is the case, then I just opened pandora's box, and am wishing I would have done this much sooner. 

BTW, I am talking about SFH's.

Thanks for any and all replies/help. If I need to give more details on something then please let me know.

Thanks so much for all the responses so far. 

I was actually going to ask if I should still factor that in whether I manage the property myself or not. So, guess I will still factor that in.

Now for the big question.... I have enough to pay cash for this property. Should I just buy it outright, or would you guys recommend doing the normal 20% down, and trying to buy 1 or 2 other properties in addition to this one?

Keep in mind, we are getting into this for monthly cash flow.

B- in my area most likely would only be a C or so location in the big cities. Also I'm new at this, so its possible I am over rating it lol.

I plan to manage this myself as it will be my first property. Want to learn as much as possible and also save as much money as possible. So I would rather manage it myself as opposed to paying to someone else to do it. Was thinking that would be for later down the road when I have multiple porperties? Or should I just plan to have someone manage this from the get go.

Thanks for all the replies so far. This is exciting and scary all at the same time. I feel that this first purchase is crucial to my future portfolio.

All utilities are paid for by the tenants.

I'm going to try and get a good estimate of repairs. Even though they are all currently rented, from my research, you should always figure in the cost of some repairs?!

My wife and I are both young (25-29.) We have been thinking of investing into rental property for a few years now and we both feel it is time to pull the trigger.

Our goal is to be purchase and hold investors. We love the thought of the passive income that comes with rental property.

Anyways, I found what I think is a good deal and wanted some advice.

Found a triplex, 2 of the units are 2 bedroom and the other is a 1 bedroom. Currently all 3 are rented out generating $1100/month. One of the tenants has been there for 13 years one of the other tenants is her grand daughter. The asking price is $42,000 (but the guy told me he had a little wiggle room with that.)

2 of the units have been recently renovated with new cabinets, linoliem, etc. The other unit was last updated in 2001.

I would give the location a B or B-. I live in a rural area and although this property is in town, its not like its in the middle of the city park or something.

I was considering using the 20% rule and putting down roughly $8-10k and financing the rest of it on a 30 year mortgage.

Any thoughts/advice on this? Any other info I need to provide in order to get some advice?

I have been planning to get into rental property for a while now. Have been saving up the money and have around $50k to invest. I currently have zero property, but would love to get enough cash flow to quit my day job lol.

Just not sure if I should just pay cash for the property I get, or if I should use my money as down payments and get multiple properties. 

Any and all advice is appreciated!