All Forum Posts by: Ian Halter

The most competitive quote coming from a surplus lines insurer is surprising, it's worth reading your Declaration Page in fine print for that offer. I'd approach that one with healthy skepticism. 

You're doing the right thing going through an independent agent and I would echo what @Luan Oliveira mentioned about comparing coverages if you're using the big carriers (Liberty, Geico, Progressive, Traveler's, MAPFRE etc...). With any independent agent, they will have carrier preferences so just be aware there. Most of the times those preferences help you, but worth asking your agent the reasoning behind a certain carrier. 

FWIW Geico does not write home insurance, it may seem so, but they have business arrangements to have it underwritten by different top carriers. So they [Geico] may be very competitive on price, but the complexity of service is not worth it.

Not for bulk purchases: I have had success finding old knobs, pulls and hinges at antique and architectural salvage stores, which are far more common in the Northeast US than in other regions. Some salvage stores are non-profits, so your purchases are potential tax write-offs as they might qualify as donations. I have paid between $0.50 - $1 / knob or pull. These will be higher quality, but usually in worse condition than what is on Amazon. I've also restored knobs and pulls, that I found for free, and learned that to not be worth the effort.

After going on Amazon though, the price and variety are excellent for bulk purchases and unless you already plan on going to a salvage/antiques store, Amazon looks like the way to go.

As a first step I would ask them what exactly they're talking about or where they saw that information (like on a TV ad or online), so at least you can open up communication channels and get a better of idea of what they're actually asking. You might not want the added conversation with your tenant, but in my opinion guessing what they could be talking about and trying to solve that is a waste of your time and resources.

If you want to scale quickly, I would not house hack at this time. Labor and materials are very expensive and with rates where they are, net operating income/cash flow (unless you put 20% down) will be slim unless you can find a steal in a B/C neighborhood or grab a home on the East Side (where competition is still high). House Hacking a MF into 2-3 separate condos will require the buildings be up to code and inspected, requiring permits, zoning, repairs, utility splitting and renovations. House Hacking, from what I've read, ultimately it comes down to hidden costs. A good overview can be found here - https://andysirkin.com/subdivi...

Finding a deal locally is more advantageous than OOS for many reasons, which I won't cover here. You need to prioritize your financial goals. If scaling is more important, then spreading capital over multiple OOS deals makes more sense; however you will be more exposed to more variable costs. Investing here allows you to control cost better, but with higher capex.

Ultimately you can be more diversified in OOS (like Ohio you were looking at), but more susceptible to unexpected high costs. Good boots on the ground can help you here.

You can be more savvy and learn fast investing here, however more of capital will be tied up. A great agent and contractor will go further than anything else for your first MF.

In an A/B neighborhood in Providence, if your goal is better quality tenants, you don't want to be the one place that has coin-operated laundry.

@Taylor C Payton Happy to help, I'm working a 2-family with the potential to house hack right now. As others have mentioned there are few B/C rated areas for cashflow and renters just outside of Providence as well.

It can seem daunting to get started, but you're in the right place. I would go through BP and find the "Getting Started" guides, the "Starting Out" forums, and travel through those posts. There is a lot of excellent information there, for what I think is a big question in a single post. Hope this structure helps:

1. Understand Investment Type and Strategy, pick 1-2 that work best for you. Most people start with Single Families or Small Multi Families (2-3 units).

2. Learn how to evaluate that type of investment type + strategy. Download a template here on BP, use a free tool or try to do it yourself. A spreadsheet is all you need, no need to pay for anything.

3. Find homes in the region you're interested in and start plugging in numbers. When I first started out I think I evaluated 100s of properties as I was searching and eventually you'll be able to tell a great investment without much effort.

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1. The first thing you have to understand with is what type of investment (Single Family SF, MultiFamily MF, Short Term Rental STR, etc...) and strategy (BRRRR, Long term hold, Fix-and-Flip, Cash out Refi etc...) fits your financial goals and personal risk level.

2. From there, figure out how to evaluate those investment+strategies. Ex: How do I evaluate a single family BRRRR in the southeastern MA / RI area? I would find a template on BP (an excel document or tool that evaluates a SF home), there are very smart and experienced people here to lean on for these things. However I found trying to create it yourself is the best way to learn. Finding/re-using or DIY are the ways to go, there's no need to purchase any evaluation tool.

3. The last step is to start using the tool, pick some random houses or houses you find interesting and start looking at numbers. Based on your strategy you might want to connect with people here to figure out how much things cost, or what's a great up and coming region. Other folks start with picking a region (like Providence, RI) and analyzing properties there, I do the opposite, neither way is better.

@David Worsowicz I may have someone interested in that, if it comes to anything I'll DM you. Best of luck with the sale!

Boston is overvalued - positive micro factors (low housing supply, very strong local economy) are propping up negative macro factors. Appreciation here is fueled by confirmation bias (it's not that people are really willing to pay top dollar, but that everyone prices their home there and they have no choice) and top of the market new builds. Homes farther out are worth it (30-60 minutes public transit for downtown proper), but they will require capital to reno if your goal is rental. Otherwise you're paying a premium for a home close to offices. You could work off market homes to find good deals or put more cash down, otherwise bidding is fierce. Joining a syndicate at this point is worth if it you have the capital to fall back on, there's high risk local towns will agree and then reverse their decision to build.

For the price and neutral outlook, when you factor in the opportunity cost for missing out on a property farther outside of Boston (30min to 1hour drive) and tying up capital, Boston isn't the area for rental property accumulation or growth.

I agree that rewiring existing electrical should be relatively inexpensive, since you'd just be re-attaching wires that are incorrect (top unit wire attaches to bottom unit panel) to the correct panel. A certified electrician would be happy to snake and/or reattached existing wires, especially on the 1st floor where it's easiest.

I would use that surcharge @Johann Jells mentioned and take it further. By creating a flat surcharge, you may be able to pay a flat month amount - equal to what an energy supplier may charge for an up front plan. 

Ex: National Grid, the major energy provider in RI, was piloting a program where you could pay $x every month for heat ( a flat rate) as a way to smooth out seasonal energy cost variances (you pay less in summer, more in winter). When winter months came and you owed $3-4*x, National Grid would take what you overpaid in the summer months and apply that to your winter bill. So if you charged your tenant $x month you'd be reducing the variance in your utilities AND simultaneously making a tenant happy by splitting what are MUCH lower winter heating and electric costs. (FYI National Grid burns gas to generate electricity so focusing on reducing electric alone won't amount to much)

tl;dr - make surcharge for utilities, use that to sign up for National Grid payment plan - a flat monthly energy rate where you overpay in summer and underpay in winters. Any excess cost in winter, which will be low or very low, you split with tenant. Tenant is happy with regular payments and much lower utility costs in winter, you get stable and easier to manage utilities without having to tinker with new HVAC or Gas lines.