All Forum Posts by: Account Closed

I got an alert on my phone for a just listed mobile home. The home is 1,440 sq. FT and 2 bedrooms. The reason it is cheap is because it needs a new roof. Does anyone have experience with this? My in laws just paid thousands for a roof on their house, are mobiles just as bad? What should I be concerned about? Best, Greg

Hello BP! 

This is my first post in the DIY section. Just a quick backstory:

I have been living with my wife (Adries) at my in-laws as we finish saving for our first investment/principle property. While living here we are taking advantage of the free rent and slowly fixing up the home. So far we have re-painted/new hardware in two bedrooms, as well as renovated the bathroom with new tile, vanity, hardware, toilet, lighting, etc. They are gracious and keep splitting or paying for the repairs. So now we are onto the backyard:

There are cinderblock walls, a pool, and a patio cover that needs some love. What are your thoughts on fixing up a cinderblock wall? Given that replacing is not an option what is a good chioce? Can they be painted? Is their a simple way to modernize them? Cover them?

The backyard is mostly concrete because of the pool running parallel to the street. The back-most wall is approximately 5 feet tall with a wooden addition framed out adding an additional two feet to it. The left wall is shorter, approximately 4 feet also cinderblock, no additions. 

Current plans include: new patio, solar panels eventually, moving the pool filter/pump from the corner of the yard to the side of the house near the air conditioner to free up space. 

Thanks!

-Gregory

UPDATE: I finally received my partial security deposit back today. My previous landlord could not be contacted over the last few weeks and last night I received a text message that the partial refund was in my old mailbox. Along with it I found an itemized list for deduction. 

Overall I'd say it was fair. There were two deduction that were questionable. There was a cleaning charge as well as a charge for the infamous blinds. What was peculiar was that everything that was deducted had an accompanying receipt except for the blinds which had a copy of a Home Depot online shopping cart for blinds that hadn't actually been purchased that was printed yesterday which makes it seem like an afterthought. Why print the shopping cart and not the confirmation? Disputing this seems like it wouldn't be worth the time although the blinds deduction was $158. 

It was a learning experience, and being on this side of the transaction will have untold benefits in the future when roles are reversed. 

@Sue Kelly, @Manolo D.

What are your thoughts about emerging out of your period of negative cash flows? Was it worth it? What about the equity, not necessary appreciation but the paid off portion of the loan assuming the loan represents approximate market value today? Also, is it wrong to assume that so long as the negative cash flows, be it by repair or vacancy or both, fall below the principle loan service is amount that it can been seen as a positive? Or that the negative cash flow was worth it? 

Of course a single answer cannot fit all situations, but is it possible that in a given circumstance you would consider a negative cash flow "worth it"?

I was listening to an older episode of bigger pockets today and they brought up the discussion of a negative cashflow rental, specifically in the context of turning a principle residence into a rental property. I could use some insight on the numbers below:

In the episode they discussed a principle residence that now cash flowed -100 a month. That said I can't get my mind around cutting the losses on the property because of the following:

Given the home had a 300k 30 year fixed, 5.25% loan, the payment would be $1,656 a month. I constructed an amortization table in excel and noticed that each payment had a principle portion of $344 from payment 1, increasing each month as the property is held longer.

What I am wondering is that a negative cash flow of 100 is actually a positive $244 payment as the principle portion paid down by the debt service paid by the tenant nets in the home owner's favor. So is it really such a bad thing to hold this fictitious property given that the vacancy rates are low, and given that tenants are of decent quality? Even a 1 month vacancy seems to be offset by the principle paid down during the first year in excess of $4,128 (monthly principle portion x 12 months, understand that the principle portion grows over time and these are just ballpark numbers).

What are your thoughts? Any first hand experience? In my newbie opinion the numbers seem to align that if the cash flow isn't detrimentally negative $100 a month is a small price to pay for the debt service paid down. 

Thank you all for your quick responses. We have moved out and the landlord seemed easy going int he begging. The process has become arduous and they are no longer returning texts or calls. During the walkthrough they mentioned that the blinds they had were custom cut, however when measured they were the typical bali dimensions and brand from home depot. We have pictures of the blinds at move in that show some were below the window spec and left an inch or two gap on each side of the window not to mention being short 6" - 12" depending on the window. We will see where this process takes us. Currently we have moved in with the in-laws and are saving to buy our first principle or investment property. 

If this is typical for landlords it inspires me to provide people with better. I am now taking the perspective that you have to experience this side of the transaction before being on the other. I will keep you all posted. @Sue Kelly, I will definitely keep you posted . 

Thanks again,

Gregory Lomelin

Please help, I have lived in my apartment for 2.5 years, never a missed or late payment. Replaced my broken microwave myself to not bother the landlord. My cat walked in and out of the blinds enough times to break a few pieces off. They were Bali blinds supposedly custom cut but the store bought size. As an act of good faith I replaced every set of window blinds with the Bali grab and go blinds from Home Depot (same material). My landlord now wants to charge me to get all new blinds! Also, the carpet pulled up at the tacks from the traffic not the cat. The window screens (2) have a few marks from my cat The shower has some marks on the glass from the tap water. My family and I cleaned this place day and night for days, and I get that I may have to pay for some of this stuff but I don't want to get taken advantage of. What is reasonable ? Help! Best, Greg P.s. live in Los Angeles, CA

BP, I got a lead from my neighbor about a house that is starting foreclosure. What is interesting is that every door was widened to accolade the owner who has a wheel chair. Also, from what I hear, walls have been moved as well to allow more access (for example in the bathroom). There used to be an inch it two porch (cement just raised) it now has a gradual slope like a small ramp. What are your thoughts about a home that has been modified like this? Would it be best to return it to stock? When calculating an offer would you consider reversing this in your calculation? Does it limit the potential buyers?

Can you provide details. Present value of the mutual fund? Value of home loan, interest rate, down payment, rental revenue or met income monthly our annually estimated for simplicity. Also, any upfront payments, agent, points for loan. Provide what you can.

Thank you all for you quick replies!

From my understanding (still learning daily) once the foundation is an issue the deal may be best left behind? This is actually a property my old landlord had and was thinking about renting out. For grins I asked him if I could walk through it to see what I thought.