All Forum Posts by: Casey Rumfelt

The SFR is in Huntsville, I think I got it for a pretty reasonable price, nothing to write home about but I am content. We completed the home inspection, insurance inspection, I looked at the property, the agent looked at the property, my property manager looked at the property, and the tenant inspected the property and found it to be inhabitable. No glaring issues of note. We had the house painted and a floor replaced prior to putting it on the market.

Then two months into the tenant living in the property, BOOM, he calls and says we have a mold problem. I was notified on Sunday via my property manager, and we immediately got to work trying to get estimates. Here we are a week later and I still don't have an estimate... is that a normal amount of time? We have had two mold companies out they say the HVAC is the issue, then we called two HVAC companies, and they say yeah the HVAC needs completely replaced and all the duct work. The unofficial first estimate is expected to be around 13,000 dollars!?!?! (That seems a bit high for a 1200 sq ft house)

The other problem (according to my property manager) is my crawl space isn't draining correctly... So no one is actually telling me the source of the moisture inside the house. Should I just hire a general contractor to come in and rehab the house? Or am I going a bit too far?

The follow on to that question is how much do you put in towards an asset that will only be worth 95 in the end?

Then the cherry on top is the tenant is starting to say things like "I'm not feeling good and I think it was because of the mold."

So anyway, just figured I would see what some of you all thought.

Thanks for all the recommendations I’m checking into several. Will post once I have some kind of resolution. Is it just me or does everything take longer than I expect?!?! Haha 

I am military, and currently living in the Fort Rucker area, but so far I have focused my real estate investment in Huntsville AL. (2 properties thus far - 1 about to be accepted) I'm getting to the point where I need to find a investor friendly bank. Someone that will loan to an LLC and work with me on future deals, HELOC, Commercial.

Any advise on where to start would be much appreciated. 

Is this still for sale?

James I will be moving back into the area soon we should start a real estate "group" if one doesn't already exist. 

Speaking of moving back, I have never purchased a property in the area but am considering it for this move, did you ever find a good agent that you recommend? 

Enjoyed reading the breakdown you gave of the area, and think that you are spot on with your assessment. 

I also recommend "Never Split the Difference" great book.

- Casey Rumfelt - 

Mario,

Can you send me the information on this property? The best email is [email protected].

Thanks,

Casey

Appreciate the input from both of you.

Chris I agree with you. The two things that are against this house is 1. negative cash flow 2. no real plan for it...

The only thing that I will say is the property earns me more than double what I pay into it towards the principle. So negative CF now means faster paid for property = CF later. Even if I had positive CF I would just put it all towards the property anyway.

Jason - With the money from this property I would just put it into something else, maybe a commercial property (5 or more units, or something that hits all the widgets needed for an investment property). I don't believe I can raise rent enough to escape the negative CF situation. My goal is it have some great investment property(s) so that by retirement (6 years or so) I’m not looking for another J-O-B.

I know HSV is kind of a hot market right now and being from the area your perspective is greatly appreciated. I know you can't predict the market but do you think that it would be advantageous to wait to sell vice selling this year?

The home is in South Huntsville within "The Dairy" subdivision. I'd be interested in seeing the comps but I am afraid the new houses still being build will actually hinder me when it comes time to sell... but maybe not.

As far as the rent goes (and I need to talk to an attorney, if you know a good one let me know) but I want to offer a settlement for the tenant. Basically, tell them what they are responsible for and then discount it significantly for a one-time payment to be free from the property. Something on the lines of “Total amount responsible for is 15,000 dollars, which we can drag on for another 8 months or you can cut a check for 10K and be free from the situation.” Seems like a win-win, they are free of all responsibility and I can then rent / sell the property on my own timeline. However, if you include lawncare and utilities which they are also responsible for until May you can easily tac on another 2K (ish). 

So I have a property in Huntsville, AL that we lived in for a while and really enjoyed. The property is almost 7 years old, no issues, it's really a great house. We have had it rented for a year now and a new lease was signed for another year in May. The current tenants have indicated they want to move out at the end of the month but understand they are responsible for the rent and utilities but would like for us to find another renter...

Here are my questions.

1. Am I able to find another renter and still hold them accountable for the rent associated under the current contract? Basically double charge?

2. Or should I sell the property?

Details on the property: So I have a negative cash flow with this property because I (never intended to rent it) got a 15-year mortgage. The property actually brings in a fair amount of rent for the area. Property values have gone up recently and because the 15-year mortgage I'll have about 80K after all the fees are paid. I have no pressing reason to sell or to keep renting it, kind of neutral about the whole thing.

Both these options seem to lack creativity but figured I would post and get some other insight from everyone. 

Any thoughts or ideas would be greatly appreciated.

Quick question... I have an rental house that is out of state (Alabama) and I have been thinking about putting it in an LLC for a while. Will I lose my ability for a homestead exemption if it were in an LLC and I were to move back into the house? Additionally, would I lose my ability to avoid capital gains tax because I lived in the property 2 out of the 5 years because it's a business entity. ?