All Forum Posts by: Account Closed

I'd leave it as-is. Looks fine

For about $125 you can buy a 4 station timer that hooks to your house water hose bib, sprinklers, and hoses - less if you don't need 4 stations. I use these all the time on my flips where I need to keep the lawn nice during summer rehabs. When you lay the sod hit it hard with water for 72 hours then back it down and it should be good to go. If your tenant pays water then you'd need to cover that but it wouldn't be much. At least you'd get out of the $100 a month obligation until the spring.

You might be able to tell what's underneath by removing an electrical outlet cover or switch plate if available. In some cases I've screwed fresh drywall over the panelling  and finished it off. If you do that, and have electrical outlets, you can purchase electrical box extenders so the outlets mount properly after the new drywall is applied.

If he is a wholesaler, he knows the drill. I would not pay over $85,000 based on your rehab numbers. As someone once stated somewhere on BP, "I would rather lose sleep over a house I didn't buy than a house that I did buy." It does sound fishy so proceed with caution. Have an inspection. Things that come to mind, 1) Why doesn't he rehab it? 2) Research the title, as mentioned above. Now is the time to establish a relationship with a title company. 3) How long has he had control over it and why hasn't it sold yet?

For me, it's not worth my time it to learn HVAC. The same for advance plumbing and advanced electrical. Plus, the codes are changing all the time. Back in 2009, here in Idaho, a guy tried to do his own work. After a few months a very small gas leak had accumulated in the crawl space until his house exploded.

Is it in any kind of condition that would allow for utilities to be turned on. Without even looking at it I saw $40k in rehab costs flash by. It doesn't take much to burn that up. Then again, it could have good bones. What year was it built? Inspector would be a good start. I always use one to check things out and it's well worth it. Plus, the $350 to $400 is drop in the bucket and I have paid for them and walked away from the deal.

I agree with @Jason McDougall.

Keep trying and try new methods. I'm not a wholesaler, but decent (not even great) deals are tough to find in most markets these days. Sometimes I go six months with no delas and then, BOOM, three great deals come all at once.

@Madhan S. 

I would reach out to @Jonna Weber who is an agent and very active on BP and an REI club here in Boise.

From what I see the cap rates on nice four plex units are running 5% to 6% (assuming 40% to 50% expenses, which should include CAPEX accruals) and by nice I mean there would only be minor differed maintenance and those could probably be remedied before closing at the seller's expense. However, depending on how much one puts down the cash-on-cash return might be decent. The one I own is in a small seven building community. Our HOA is low, $158 per month and that covers, landscaping, watering, trash, and snow removal. I've seen where some of the larger communities can have HOAs that run $250 to $400 per month, especially if they have a club and a pool and an onsite management office, etc. Also, my community allows the owner to self-manage and some communities dictate the property management company. I know one large community where the majority-owner of the complex also owns the PM company, which I would not like because I feel they would be inclined to get their units rented first as vacancies come up.

@Madhan S. 

Have you run the numbers to see how things would cash flow here in Boise? That would be my personal first step. Perhaps a duplex or four plex depending on your goals. Properties have spiked here as well but rents have too and the vacancy rate is low. Not sure how property taxes work in Phoenix compared to Boise. My non owner occupied rate is about 1.5% of assessed value. If you look at any of the multi family that are part of an HOA be sure to check the HOA fees as some can run quite high, especially those with a pool and club house.

There goes the neighborhood....up up up. 

Great job !