All Forum Posts by: Sam LLoyd

Tell him that boat has sailed and give him your new offer.... OR....  Find some valid reason for your offer to have changed.  There probably is a reason that your offer has changed, such as finding out more information or learning something, so just tell him.  Or, if you don't have a real solid reason, you could probably firm something up like checking on what the utilities are and pointing out that the old offer might be good.... if the utilities weren't so high.

Figure out the address... look up the county, (borough, city, etc..) to see who the owner of record is, and send a letter.  There might be more aggressive ways to get a hold of the owner, but this is a simple way to get started.

That being said, one of the things I'm working on, and might work in your situation, is not being ashamed to make low offers.  Especially being an agent, and making the offer yourself, you won't be waisting anyone else's time.  See what they'll take.

Yikes!

First, think for the future... is this a tenant that you want to keep?  If not, this might be the perfect time to move him out.... whoops, sorry, you weren't able to keep your own apartment inspection ready.  After all, he's the one that lost the knobs and destroyed the floor. 

I agree with your contractor.... carpet goes in upstairs apartments for noise reasons... and it's so cheap to install, that you can do it every few years and cost the same as laminate every 10 years.  A 1bd apartment should be able to have carpet and a nice pad for $800-1000 using Lowes installations services (if you have a Lowes there.... Home depot?)

You'll probably save money paying a handyman or some young person to remove the old carpet and pad.... and we'll go ahead and assume there are pet staining... so make sure you have someone get in there and bleach the floor and paint it with Killz or a product that is anti-microbial.  We do all the work ourselves, and I've had good luck using straight or diluted cleaning vinegar to get rid of smells without the fear of bleaching anything you don't want bleached. 

Also, if you do move that tenant on, and want to provide a nice clean apartment, you'd better plan on getting all the walls and ceilings cleaned and painted.

I hope this helps.

I don't think there is enough information here.... we don't know anything about the existing wiring.  100A should still be enough for a small house, so switching the breaker over to a 200 and running all new circuits to the addition should work.

That being said, here's what I think.  If you've got all the walls open, yes, get the wiring replaced... for your own peace of mind if nothing else.  However... I would caution you against having 'cheap labor' rip it all out without the supervision of the electrician who is going to be redoing it.  I could be mistaken in your case, but on other projects I've run into big problems when the demo was done without an eye towards the finished product.

Three thoughts:

1st.  How are you going to participate?  Are you putting up the money and he's doing the work?  Are you both putting up 50% and doing the work?  This is very critical, as expectations will probably be broken if they are not nailed down.  If you're both working, the guy who shows up at 5am (me) will eventually resent the guy who shows up at 9am and takes long breaks.  It is very hard for people to get along when there is that much money on the line and a time crunch.  If you're coming in with the money, and he's doing the work, I'd say you buy it, and pay him per job for the work, and a bonus based on how long it's on the market and what it sells for.  You don't want him to get distracted, take a year to finish while you're paying taxes and such...  If none of you are doing the work, one of you is still going to end up doing most of the contacting of contractors and things.

2nd.  What is profit?  If you're doing the work, you're just getting paid for your time.  The one flip I did, I ended up doing a lot of the work.  Yes, I took home around 20k, but I also had over 400 hours into it.... so maybe $45/hour before taxes..... not profit.

3rd.  Yikes!! that deal does not give me any confidence.  Have you factored in commissions and closing costs, as well as holding costs while you are flipping it?  The flip I did was purchased for 100, sold for 200, and between the holding costs, repair costs, commissions (and I used hard money), I only took home 20... and I am very thankful for it.  Also, let's say you're into it for 175 cash... you still have to put some money aside for maintenance and vacancies, so you would not have an actual income of 1200 if you rent, more like 1000.  So, even if you don't owe anything on it (there's still taxes), you're return on investment would only be 6% cash on cash... which does not make this a good exit strategy.  Make an offer in the 120 range, and then I'd feel a lot better about the numbers.  

Let me know if all this makes sense.

First, find out what the zoning department has to say, and then the building permitting.  These are going to be your biggest hurtles. If you hit a brick wall with either of these, you've saved yourself time.  Also, these departments should point you towards any other issues that need to be addressed.  Keep in mind though, that the people there don't make any money off of you, so they might be more pessimistic... only go with the facts that they give you. 

Next step would get a contractor in on it for an estimate.... there's a lot to this conversion, and I can't tell you more unless I knew a lot more about the house, such as the type of heating......

Another thought.... depending on your location. If you take a SFR where the tenant pays utilities, and convert it to a duplex where the landlord pays utilities you might not actually be making any more money, and you'll have more tenants to deal with and potentially lower class tenants. For example, there is a duplex in my area that has two 1bd units and landlord pays utils... it would probably be better if it was a large 2bd house and the tenants paid.

Another question as I explore these options.  Right now I have a pile of receipts for each property that I add up, and then put that number into my year end spreadsheet.  Inputting those receipts into the software would be necessary to be able to provide accurate reports, but taking the time to input them will add quite a bit to my work load.  So, does anybody have a system for avoiding this step?  I've been referred to expensify for getting rid of the pile of paper receipts, but I need that app (or another to integrate with the landlord software.

Any ideas?

That's almost exactly what I was going to say, but I was going to put it this way.... dress one step up from the class of property (assuming you don't know who you're going to meet).  So, if you're visiting a trailer with 300 trashbags on the porch.... wear work clothes.  If it's middle class income neighborhood.... dress casual, and if it's really high end or maybe commercial... you get the idea.

Personal thought that may or may not apply:  Don't wear fancy shoes.  Looking nice is still possible, while wearing something that lets you still walk around the house.  I've looked at houses with agents that are tip-towing through the snow and muck, and this only tells me they are not really on top of their game or thinking ahead.

Most definately. I would go for a duplex, preferably side by side, with the following provisions..... if your neighborhood has only dumpy duplexes, maybe stick with SFR if they can get you a decent return. If you can afford 4plexes, and your demographic is high quality, go for that. The more unit, the more tenant issues... so only start with a 4plex if you have a thick skin, it's in a great neighborhood, or you have experience with management....

If you can't afford a plex in a decent neighborhood, consider buying a plex and moving into it.  The financing you can get with owner occupancy is awesome... and if you're moving out of a house you own, then you have another rental there.

With minimal experience and/or minimal funds, it's hard to get the highest returns possible.  However, it's still better to get into the market with extra cash-flow coming in than to wait.  That being said, if you are patient, even moderate returns will make a big difference in a few years.  In addition, if you can buy a property under market, or with an opportunity to add value (even if it's just paint and landscaping), you then have the ability to give your investing a boost when you either raise the rents because you have a higher class property and/or pull out some equity to invest in another property.  Slow and steady wins the race.... or fast and steady... either way you have to get started.