All Forum Posts by: Henry LiChi

Jason S. It must be so frustrating to receive advice over and over again about being frugal and paying off debt when it wasn’t what you were asking for. Most people on here are just planning accordingly long term but looks like you’re trying to fast track yourself out of this debt and get back on your feet. Despite making six figures and I do as well, supporting a family and living in the Bay Area quickly drains that. My advice is to attend as much meet ups as possible to network. It is no cost to you but a few hours a week. There is always a good one in SF that has many prestigious investors. There’s no way you will do this alone. You’ll need to partner with someone and if you don’t have the cash, expect to put the labor in and find the deal to make it work. It is absolutely possible to not have your own money in if you have a proven record or can some other way prove that you can make your money partner an amount that is worth their risk. Just my 2c. Like they say.. it’s better to have small percentage of a deal than no deal at all

@Anthony Lee @Account Closed

Info sent.

Duplex that is being sold AS-IS with great potential.  This is not for a novice investor, this area requires good active property management and an investor who knows what she/he is doing.  I am not trying to scare anyone but I want to be honest and completely open as this community has given me a lot of insight and I want to be fair and not mislead anyone.  It is not East Cleveland, not even close to being as bad, but it is a D area that needs some love.  High tenant demand in that area due to low cost of rent.  Both units need work; estimated 2-3k each to make it rent ready.  I am open to selling this via land contract with a significant down payment and if your lawyer prepares the contracts for my lawyer to review.  

@Matthew Jure

The only way capex and repair would be less in a 10 unit apartment is if you own equivalent in duplex (5 duplex or 10 units).  In an apartment you get potential repair calls from 10 different tenants versus my 3 duplexes which I rarely get any repair calls from.  I’ll be honest though, I keep my place immaculate and above the average standard in its vicinity.  It is always cleaned and preventive maintenance is done regularly.  I rarely receive maintenance calls in my properties because of this.

Matthew Jure 15% repairs is quite a lot each month. You’re going to have months you need repair and months you won’t. I hope it doesn’t average out to 15% of gross rent. I have several properties in Cleveland and I have been allotting 5% capex and 5% repairs and haven’t really dipped into them much, at least not on a monthly basis. I do, do all my repairs and rehab upfront so there isn’t any deferred maintenance though.

Hi all, I am looking to get rid of one of my properties to one of my contractors who is willing to put 25% down and make monthly payments with 5% interest over 3 years. I have complete confidence he will be paying off earlier and won’t be missing payments, so that is not one of my concerns. My concern is that I have never done this before and don’t know the technicality behind it. My realtor says I just need to put together a land contract and have the title company review it and officially file it. Are there additionally steps? How would I set up a monthly invoice? The buyer plans to rehab the property to make it rent ready, it is currently in bad condition which he knows cause he is the one that boarded it up during the winter. The property will be sold as is. My understanding is that I will still own the deed but he will have equity interest until it is paid off. Is it possible that I would still have liability in any sense? Thanks in advanced.

@Kam T. 

That's hard cost only and based on the clients I have been dealing with which typically only put out high end products in high density transit oriented developments.

Justin May I have only had to deal with POS a handful of times. Most of which I made the seller deliver POS violation free but your miles may vary on that one. I had to deal with a POS in Maple Heights where my GC gave a very low quote and the city said it was too late and I ended up having to deposit 2x the estimate into escrow. But 100-150% is typical and can’t be touched until POS items are resolved and inspected by the city, so yes, you may be using additional funds out of pocket in addition to the deposited funds.

@Shannon Collins

I’m not looking to sell them.  But they are in Euclid 

Value add to me are items that will actually raise rent or lower expenses that ultimately raise the NOI. - Reducing utility expenses through either separating meters or if you can’t, convert all fixtures to low flow. Low flow toilets, shower heads, aerators for both kitchen and bathroom faucet. Change all light bulbs in common area to LED. - Better property management - Communal laundry for additional income - Renovating common areas - Rehabbing units as they become vacant to raise rents