All Forum Posts by: Frank S.

I do six months cash.  I store them in "Mango Money Savings Cards", Nestspend, and "high" yield savings @ MySavingsDirect and Discover.

Welcome. Work hard and develop a plan. This site has excellent education. Find ways to raise and save money, look at FHA 203K loans, research the market, and build a good team.

Best wishes, 

Frank

I faced a similar option in Albany Park for a MF REO listed at 475K a year or so ago.  I reached out to the agent directly, he referred me to his lawyer/realtor.  The lawyer showed up with a market comp at $415K, I passed on the deal.  Curiously,  it went under contract shortly after and closed at $415K. 

Anecdotes are not evidence, but consider giving the agent a call, see if they can do a dual agent deal  (they probably can't), then, ask him for a reference and go for there.  At least, you will be represented by someone with a good business relationship with the listing agent. 

Aerator. At the end of the faucet, there is a strainer, it's held in place by threads.  Do a quick google search, you can do it while doing a walk-through.

Here is one of my fav websites for DIY.

https://www.familyhandyman.com/plumbing/faucet-rep...

For the shower valve, you may need to take it apart, nothing more than a few screwdrivers and an allen key set.  A handyman can do this as well, but you should learn how to do it as a new home owner/investor. 

The good thing about old galvanized pipes with low flow, is that you save on hot water and cold water!  If you replace the risers, use low flow aerators and shower heads. 

Frank

@Elliott Kim, 

One note:  add $1800  to $2400 for a 3 Ton AC.

Low pressure is due to friction and sedimentation, the galv. useful life is 35 years. Copper risers are a little expensive, not hard to install.  Check VIEGA Propress fittings, you may be able to DIY. The real problem is the branches behind the kitchen base cabinets or behind the bath tile. 

 A pump may be a waste of money.  It's a temporary solution and you could create bigger issues.  The higher pressure will create high velocities and friction. Particles may come lose and clog your mixing valves and aerators.  Then, you will see rust in the water.  Finally, you could create leaks.  I design healthcare infrastructure and specialize in mechanical systems, plumbing, fire protection, and med gas. Don't use a pump. 

Clean the aerators, that could be why you care not seeing sufficient flow. However, I bet is the risers. 

Water heaters in parallel or series should be fine, but then you have to maintain two heaters (yearly drainage), they will take up space, too.   I would go with one 50 gallon unit and increase the MBTU to boost recovery or a standard 75 gallon. 

Recall that gas is only for the stove and the water heater, and later a furnace.  Plan on eventually sub-metering if you have the infrastructure to place mech. rooms in each unit.  The water heater doesn't have to be in the unit.

Good luck, 

Frank

@Saginaw Sankins

No PEX in Chicago, ignore that comment.  You can't use PEX in Chicago for domestic water. It's a great product and gosh, I may seriously consider using it on my next buy and hold.  If you are outside of Chicago, it may be ok. 

If you are only replacing a few water pipes, a permit is a good idea, but you can argue to take over the risk in exchange of savings. Make sure the system is property sized according to fixture units, velocity ,and friction losses.  An engineer would only charge you $300 to $500 dollars to double check the calcs, (cough, cough...) Let me know if you need anything. 

How much plumbing are you talking about?  Inspectors will notice new copper it if you let them inside your house.  They can check records and flag you.  Are you doing other work that will invite inspectors in?  You could argue the plumbing work is existing, but good luck with that. 

Describe the SOW. 

@Elliott Kim, I have seen the area change. I placed some bids in the Albany Park and gave up. There is too much competition. Also, if you love the area and want to stay there, go for it, but this is not an "investment only" property. 

+1 to @Dorothy Wulf - It looks high. 

Double and triple check your rent numbers.  I have seen 2/1 @ $,1200.  Are you sure you can get $1,900 there?  It seems very high. 

Run the entire calculation including all expenses and possible CAPEX. How is the $5,000 roof, or the $300/each windows? Hey, how old is the $1,200 water heater? What about taxes? Was this owned by an old lady and your taxes will double? Check, triple check, and get peer review.

Electric sub-meter is possible.  All you gotta do is pick up the circuits before they reach the panel. Then, request a meter.  Will you have to upgrade your service?  However, if you are upfeeding or downfeeding, you will need to rewire.  Get an electrician to price it.  It may be as low as $1,500 or $5,000.

HVAC should run about $3,000 plus $2,000 in soffits.   Will this work for any of your units?

A place at $460K should be in pretty good condition for that area ( Pulaski and Addison)

Good luck, 

Frank

Are they "deals".  The market is a little dry. Check your numbers or post here for feedback. 

@Mark Rustin, 

Yes, Chicago has many units. I read somewhere that about 20% are non-conforming. 

I think people get busted because of neighbor's complaints. However, you don't have to let the inspectors in. 

It's a high risk. As such, you should expect higher returns for your position. 

The City could make you bring the unit back to it's original condition and remove drywall framing, electrical, plumbing, etc.  Egress is a huge concern.  Safety, as well. Keep researching, there are many sources to educate yourself on this topic. 

I own one and I love it.  I rented it as a "duplex" option with the same lease. 

I rather not buy a place with a non-confirming unit, I would prefer to build it out and keep the money. 

Best of luck, 

Frank

Below is a ROUGH guide, get a few bids. 

Galv. water pipe useful life: 30 years. Account for repipe. Bath and Kitchen $3K

Cast iron waste and vent can last over 100 years, but assume you will replace the vents and some other areas.  Ball park $3K

Water heaters $$1.2K a pop, drain for heater $1K (depends). Life shoudl be 10 years.

Electrical may have cloth wiring. If so, change it.  $6K to $10K for a 2/14.  Also, note we use more energy, this may overload your current wiring.  You may need  a new panel. $2K.

Patch and paint holes to do work above $3K

Furnance? Boiler?

Good luck,