All Forum Posts by: Gabe Viteri

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $625,000
Cash invested: $85,000

Duplex in high-end neighborhood along the train line into NYC. 35 minute commute to Grand Central on the morning trains.1920 house. Big 2 car garage detached.
Upper unit: 4br 1.5ba, floors 2 and 3
- Living in for the time being
- Expected rent $3000-$3200
Lower unit: 2br 1ba
- Currently renovating
- Expected rent $2500-$2650

Rent range: $5500 - $5850

PITI: $3900 p/mo

What made you interested in investing in this type of deal?

House hacking a duplex is not easy in this area due to the taxes. We found a property where the numbers made sense, so we put in an offer within 12 hours of it hitting the mls.

We knew we wanted to begin reducing our living expenses, so we wanted to get out of our Single Family (liability) and move into a small Multi-Family (asset). Once we have a renter in the bottom unit of the duplex, we expect to reduce our living expenses by roughly $1400 per month.

How did you find this deal and how did you negotiate it?

MLS

How did you finance this deal?

Traditional financing
Used a local lender that doesn't require PMI

How did you add value to the deal?

Renovating the house
- Upgrading kitchen(s), upgrade half bath to full in top duplex making the whole building a 6br 3ba, upgrade appliances, improve landscaping

- run electrical to the garage and rent that out as a premium

@Taylor Stamm I have a SFR in Westchester, NY where I had solar installed on the roof. I estimated a 90% offset of electric based on previous year utilities. Having made some efficiency upgrades to the windows, my actual offset is almost always 100%. This leaves me with the $17 monthly delivery fee from the utility company and the $80 loan to pay off the solar loan.

I incorporated an extra $125 into the monthly rent and advertised my property as free electric. I believe this is a large and attractive perk for renters as nobody else in my area (when I posted my rental) had any similar utility advantages.

I am now in a duplex and with the NY state tax benefits am seriously considering doing the same thing on the new place.

@Joe Jor Wow 90% is a GREAT LTV!

@Joyce Ong I used Beth Page Federal Credit Union. However, I've recently found a better rate, no application/processing fee, and will potentially refinance into them. Call Trust Co in Northvale NJ. You'll have to google their phone number due to forum rules. Gina Sarwari is who I worked with. Tell her I sent you! She's amazing.

Good luck

Hey @Brandon Morrison best of luck my man. Westchester is not an easy area, but we can use more great wholesalers! There is a lot of opportunity out here, so keep at it. Stay positive. Keep moving. 

All the best

Hi all, First steps out of the gate here, and I just wanted to get some input from the folks here that have been doing this for awhile.

I came across BP too late in the game and had already purchased a SFR. I now want to buy a triplex, house hack the other two units, and rent my SFR out. As an aside, I don't want to sell my SFR because I have a favorable HELOC that I plan to invest using the BRRRR strategy.

SFR

My existing mortgage is $2537 all-in. I can get $3k to rent this house. After I calculate my capex + vacancy + maintenance, I am -$70 a month. I will have to manage it on my own for a time, which I am okay with.

Triplex

The HouseHack Triplex after Capex + vacancy on the other two units + maintenance while I'm living there will be -$296 while I'm living there (1 year minimum for loan purposes), and +$1005 when I move out based on current rental rates.

Assuming all units are filled when I move into the Triplex, I am technically exchanging my $2537 mortgage for a $371 payment to own two properties. Here's my question, am I fudging the numbers if I use the balance of $2166 (2537 - 371) as a positive monthly number? I understand this is no longer an income, but it is more specifically a reduction of debt. 

How should I be framing this concept financially? It seems like the cost of inaction is very high.

My question to any investors in this area is Do you have a consistent strategy to portion out funding for Cap Ex? Given that most homes are from the 30's-50's are you using a dollar amount per month or a percentage? This will of course change based on size of the home, and I am looking exclusively at 2-4 unit buildings between 2000-4000 sq ft.

Thanks, looking forward to hearing your thoughts guys and gals.

Thank you both @Bob Okenwa and @Mary M. for the input. 

For example, a tenant in a property puts down one month security deposit at the signing of the lease to landlord A. The property is sold to landlord B half-way through the tenants lease. Now the lease is up and I assume landlord B must honor the tenant's deposit refund as stated in the lease. At what point, if at all, do landlord A and B transfer of security deposit? Is this often overlooked? I can see this being an unforseen expense for landlord B if not properly addressed. Thanks, just curious!

I live across the street from a private, Catholic school and church. In addition to the church and school buildings, one of the SFR's on my side of the street is used as the church Rectory (where the priest lives). This property is considered part of the church and is zoned as such. These buildings were all built in the early 50's and are about 1300 sq ft 1 story homes with basement of equivalent size, attached garage. For all intents and purposes, the Rectory looks and funtuons similar to our row of houses. My other neighbor (let's call him Eddie) and I were informed by the priest last weekend that the Rectory will need to be sold soon because of a lack of financing coming in from the school. Eddie and I have discussed and agreed to partnering up to BRRRR the place if we can. I am unsure of the possible complications that may arise from the legal conversion process from Rectory to SFR (or even ideally MFR!) . My assumption is that we will have to petition for a change in zoning, but I wanted to see if anyone could offer some advice as to what potential hurdles may lie ahead for us in this somewhat unique situation. Thanks BP