All Forum Posts by: Steve S.

So I've finally gotten off the pot so to speak and after years of reading on real estate but investing in the stock market, I've acquired my first rental.  Here's the deets with a couple of questions at the bottom:

Purchase Price - $130,000

Appraised Value - $150,000

Down Payment - $55,000

Loan Terms - 30 year fixed at 4.125%

Monthly Rent - $1,595

Property Management Fee - 50% of 1st month and 10% monthly 

One time costs fixing the place up, etc:

- $1,500 paint labor

- $1,000 Paint supplies

- $2,500 tree removal

- $500 ancillary

- $6,100 - closing costs on note

Total costs ($11,600 + $55,000 down payment) = 66,600

QUESTIONS

1) How does this deal rate?

2) With regards to profit i will get to keep each year, I'm learning the tax rules around expenses and depreciation.  I'm going to have net cash flow of about $9,000.  How much of that would i get to keep over the next many years if I'm in the 28% tax bracket?  

thanks for the feedback guys

What are the key criteria to consider when deciding if one should do this or not?

I put 30% down.  Should be looking at 25% cash on cash for the property on an annual basis. 

Home is 37 years old.  Kept in pretty good shape.

Thoughts?

If yes, how much do they usually cost?

My property manager has verbiage in their agreement that states:

"At all time during this agreement, Owner must obtain in effect a public liability insurance policy that names Broker as co-insured or additional insured and covers losses related to the Property in an amount of not less than $500,000 on an occurrence basis"

My policy 1) doesnt have the Broker added yet and 2) is for only $300,000 (plus the cost to replace the home which is about $170,000)

My questions:

1) is it common to add a broker (i.e. the property manager) to my policy

2) Is $300,000 considered too low?  Should I go ahead and up it?  It's $24 / year to up it to $500,000 but ever nickel and dime matter.  

3) would you have had it higher than $300,000 anyway?

Thanks in advance!

I've called Kelly Realtor several times.  They have a company that does property management but I've been unable to get a return call.  Maybe they have plenty of business, but usually salespeople consider the phone ringing to have the smell of $$.  If they called me back, I'd be inclined to not use them simply for the lack of response after 3 voicemails i've left.

Anyone have any suggestions for the Waco area of a good property manager?

In general, what should I expect to pay per month?  I've heard 8-12% and usually half the first month's rent, but know it probably changes quite a bit depending on part of the country you're in.

1) I'm sure there's a thread on this already but i didn't see it with a quick search.Any recommended apps?

2) At what point can i start logging miles to and from a rental?  I've made several trips leading up to a purchase, but for tax purposes, can i not log those until I've actually closed the sale?

it's an attached office as part of the house. Too small for a bedroom really but couldn't be rented separately 

Great school district. 

Would rent for about $1,600 - $1,800

Thoughts?

I've recently acquired a rental property.  It was last painted about 6-8 years ago.  It probably doesn't terribly need a paint job, but I'm considering having it painted so it looks nice for the new tenants.

A couple of questions for this 1,860 sq ft house in Waco, Tx built in the last 1970s:

- For this 3 bdrm / 2 bath house, what would a ball park cost be to have the whole things painted?

- How long does it typically take for a house this size to be painted?

I have a family member that's wanting to make some money and enjoys this kind of work so I'm trying to give them a fair price (and I'd provide the paint and materials).

What other information would be helpful to get a decent estimate or how would you go about getting an estimate?

In the Waco area, I recently purchased an 1,800 sq ft house (built in 1977) that appraised at $150,000.

The owner of the house next door is looking to move.  He said he has the following issues with it and hasn't taken good care of it the last 15 years he's lived there (also built in 1977):

- rotted wood all throughout the roofline

- brick wall venier on one side of the house is falling apart

- sheet rock in many places needs to be replaced

- cabinets have never been painted or stained

- carpet is over 20 years old

- linoleum floor in the kitchen and hallway is yellow and peeling up

- walls haven't been painted in 15 years

- septic issues

- a couple of leaks in the roof

- possible insect / termite issues

Supposedly a lady has offered him $80,000 for it.  It's about 1,600 sq ft.  

I'm wanting to determine if there's an offer i should make above that could still be potentially profitable.

Thoughts / ideas on how best to do this?