All Forum Posts by: Gordon F.

Hi guys! There's a duplex in outskirts of Akron area that has piqued my interest and I want your opinions on this deal...

1600+ sq foot Duplex, 2/1 down and 1/1 up, separate electric meters. 

Upstairs was recently updated, downstairs also looks decent, needs fresh coat of paint. 

Siding, roof, mechanical updated within last few years.

Asking price $65,000

Estimating about $300-$400 cash flow after expenses and PITI

Downstairs unit currently rented @ $650 (possibly be rented at $750? is this ballpark?)

Upstairs unit rented, not sure how much, will assume $600

I will be using PM as I am out of state.  

side yard could use a fresh load of gravel to add no-mud parking (how much would this cost roughly?)

needs small wood railing added to entrance steps to avoid falls

small mold/mildew patch in bathroom ceiling above shower needs to be removed and repaired 

needs retrofit bathroom exhaust fan to avoid recurrence of mildew ^

downstairs needs interior re-painted (average cost?)

What can I expect for insurance on a property like this?

anything else major that inspector would potentially find

estimating ready-to-rent cost between $3500-5000?

Bank won't lend anything less than $50k, seller is "firm" on price. Would be doing 25% down. Have yet to make an offer. Are these numbers reasonable? If the seller doesn't budge, is this still a deal worth considering? Should I offer a few grand over asking and ask for a seller's credit at the table to ensure I get funding? I guess at the end of the day, numbers speak for themselves, and everything so far seems like it should check out... It's my first rental investment or real estate purchase at that, and I'm nervous about missing something or screwing up. Any insight or tips are appreciated!

Thanks!

I see. So my homemaker wife who has no income would still count as a first -time homebuyer? Could we use my credit and income but her as the first time homebuyer?

Hi all, 

I'm not sure where to find up-to-date info on this specific situation so I figured I'd ask.

We would like to buy rental property in Ohio with a conventional loan @ 20% down. We don't own a home yet in California (where we live), but would like to buy something for ourselves in the next 1-2 years hopefully. Would an out of state conventional-loan home purchase DISQUALIFY us from purchasing our first owner-occupied SFR for ourselves with an FHA loan (probably around 10% down) when the time comes? Am I shooting myself in the foot?

Any help or insight is appreciated!

-G

Hi BP.

I'd like to buy my first rental property as soon as I find something that makes cents. I wanted to get some second opinions from you all to see if my logic is sound...

I'm looking at the greater Phoenix and surrounding AZ areas for a single family residence. Smaller houses right now can be found for around 110k-160k and many seem to rent at around 1% of home value. Check. 

This would be my very first real estate purchase.

I'd like to hold the property for at least a few years or more. (If I need the equity later for another RE purchase, I'd sell.)

I can put 20% down for a home in the price range stated above. 

I'm handy and could do most updates or renovations on my own, but I'm only interested in something that wouldn't take longer than a week or two of work to update as I'm out of state.

I live in San Diego so I'd need a quality PM.

My reasons for looking at AZ are the general lower costs of entry level homes. I'm open to buying something more locally but the market here is easily 3-5x that of AZ in most areas, making it impossible for me to get in at this point without traditional financing.

My questions are:

What amount of cash flow should I consider as "safe"? Being negative is out of the question for me, even if the value would be projected to appreciate for any reason. I've run some numbers including overhead costs, PM, vacancy, repairs, taxes, etc on a few properties and found a couple that may cash flow a couple hundred conservatively. is this a reasonable amount?

Should I expect home values to drop at all over the next few months-year due to current events with the pandemic?

Should I expect any issues with rent prices fluctuating due to current events?

I understand that these questions may be relative, but I am open to second opinions and advice.

Thanks so much!

Hi BP,

A few things to know about me:

-I have 0% real-world experience when it comes to anything in the real estate industry (including not yet being a homeowner).

-I have been self-educating myself for the past year or so in the general real estate subject, and I've been specifically interested in (one day) owning some cash-flowing rental properties. BP has been a great resource for me when it comes to helpful material on this topic, which is why I'm reaching out to you now.

-I work a traditional 40hr/week job

-I am excited to gain any/all experience in real estate. It fascinates me and I see the value in it and the lifestyle it could potentially offer my family and me.

I recently got the opportunity to join a wholesalers team and knock on pre-foreclosures on the wholesalers behalf for a cut of the spread. I really like the simplicity of the business model, especially how "cut and dry" a deal can be in regards to whether the numbers show a potentially profitable acquisition or not. My question for you all is, do you have any real advice on how I can be the most successful at this? Here are some questions:

When is the best time of day to make contact?

When is the best time in the foreclosure process to make contact?

What should I have with me?

What should I wear?

What should I say?

Should I file for an LLC or some other legal business entity to reduce taxes on any income generated from this venture?

What has been your experience doing this?

I know one of the most valuable things will be for me to actually get out there and DO IT and learn from that, which I have been doing, I just wanted to see if there was any other value or knowledge I could gain from anybody out there. Thanks so much in advance!

-G