All Forum Posts by: Frankie B.

I inherited a tenant in one of my properties and they reached out to me the other day and told me about damage in the bathroom.  Specifically, the paint in the tub is flaking off and going down the drain.  There are holes in the shower liner and behind and around the tub which I'm assuming is causing water damage.  They mentioned that this is something that they informed the previous landlord about and they flat out said that they wouldn't fix it.  Looking at the pictures it looks like it's not something that will be a fix, but will require a renovation.  I was going to renovate the bathroom once the tenant left. There's 4 months left on the lease.  They use the property as an office so they said they rarely need to use the shower. What are my options?

I currently put in an offer on a home and I know that it has water damage and some mold in the basement and I'm actually fine with that.  But for some reason if the inspector tells me there are termites or foundation issues it will be a hard no for me.  Not sure if my logic makes sense, but I'm told termite damage can be expensive and I know first hand that depending on the degree of the foundation issues it can be very very expensive.

We fell into it accidentally.  I was going to buy a house for my sister to rent from me and going to make a razor thin profit.  After finding and purchasing the home out of state as an investment property, with 20% down conventional financing, the arrangement with my sister fell through.  We rehabbed the home with funds of out of pocket and tried to do the LTR route.  This was during the height of the pandemic.  I got a lot of interest in the property but it was mainly from Section 8 recipients and I didn't want to jump through the hoops of qualifying for the program.  A corporate housing company reached out and asked if we were willing to rent it out short-term for a premium.  We loved that arrangement.  I think the moratorium on rent because of the pandemic had just started or was in full effect.  I didn't want to deal with that.  I got the crazy idea to list it on Airbnb.  So we furnished the property and put the utilities in our name.  The pictures that I first put up didn't even have furniture in it and I was booked out for like 3 months when we first listed. A little over 2 years later we've mainly been full with a combination of corporate leases, Airbnb and VRBO.

I'm going to give you a bit of advice, make sure that you are agile and can pivot if STR is not working. When I started out there were like 2 other STRs in my area and we were always booked and never needed to offer discounts, now my area is saturated with STRs and almost everyone is offering discounts and there are a lot of vacancies. I think that this happening everywhere. Everyone is trying to get in because of all of the money that WAS being made but I think that with so much competition that it's now driving down prices...I'm sure that there are other factors as well.

Good Luck!

@Grant R. any advice on how to approach a seller with seller financing? We have a SFH investment property and we have enough to put 25% down on another SFH, but we'd prefer a small multi-unit and that's where it can get really pricey.

I've heard it may be difficult to impossible to buy an investment property under an LLC especially if it's a newly established LLC. You may want to talk to an accountant and your mortgage broker if you are financing. We have an investment property under our names, and we have an LLC. I think we will continue to buy and sell under our names because it may be more beneficial to do it that way, but when my accountant tells me otherwise we will pivot.

Do you still need have the 15-25% down for commercial loans?

Does this just apply to Chicago or is it Cook County as a whole?

@Theresa Harris can you explain your comment about how when I make my money is when I buy?

@Bill B. you provide great insight, I should've clarified, I'm talking more in terms of what's happening in today's market.  I hear so much about that when purchasing a fix and flip you want to get it at a price point 70-75% below market, so I'm trying to understand why is it that you wouldn't want to get a deal on a buy and hold?  For me, if I'm buying a property as a buy and hold and I determine that I can't cash flow or something happens and I need to sell it quickly wouldn't it be in my best interest not to have paid over for it?  

Regarding your comment about not remembering what I paid for a property after 5-10 years, I work in finance and I remember how much I paid for my 2nd car 15+ years ago so I'm willing to bet that if I didn't get a good deal on a property I would remember it.  

I've seen this comment floated around a few times, especially when I was in the market to purchase my first investment property.  I've seen it thereafter and I'm curious what is the logic behind it?  In my mind, if I want to pay $200K for a property, but it's listed for $225K then it's in my best interest to negotiate the price down to the price that I'm willing to pay, correct......because if I don't, then I will need a larger down payment, pay higher closing costs, it will reduce my cash flow and it will take longer to pay off the loan.  Is there something else that I'm not considering where paying a higher cost may be in my best interest?