All Forum Posts by: James Myers

I have two homes in the Chattanooga,Tn area for sale.  What forum do I use to post the details?

@Brent Coombs I don't know you and you don't know me and I would like to think we are all on here because we want to give information of value and from time to time receive information of value.  To call me a lier is just bad form.  Now if you want to ask me to clarify my statement then I can do that, but please don't assume I am trying to trick or deceive anyone on the BP forums when there are smarter and bigger investors than me on this site.  

What I meant by, "I am not looking for a subtenant option but maybe an option for me", is can I set up a sandwich lease with the intention of only subleasing and not giving the "option" to purchase the property to the subtenant but leave the "option" for me to purchase at the end of my lease with the owner.

@Amanda G. No I am not wanting to live there I am just wanting to try and capture some passive income while he lets it sit there.

I am thinking about approaching a gentleman (known 18 years) about a sandwich deal. I am not looking for a subtenant option but maybe an option for me. There is no mortgage and wants $220K, which is equal to comps except that the comps have had renovations and his is still original from the 90's. I am not able to get him to come down on what he thinks he should get so I am thinking of offering a sandwich lease in order to capture some passive income he is missing out on. Since he is not going to get his asking price he is not very motivated to sell and I have mentioned multiple times that he should rent it out but again no motivation. The property has been unused for 2 years, still has furniture and will require some updating/cosmetic work to be rent ready but it seems like a great option to avoid the lender process on my side. Plus it would save him money if I paid his taxes, insurance and HOA fees.

What would be a good deal to offer him since he has no mortgage and is unmotivated to move in any direction?

- Rent would be approximately $1,350 a month (3b/2.5r and two car garage) and owners current annual expenses are approximately $5,500 with taxes, insurance and HOA fees.

- HVAC and hot water heater are 15 years old and appliances are that nasty beige and needs new carpet and paint.   

- Rent ready expense $10 - $15K

As a lessee...

- What type, if any, insurance would I need while subleasing to cover any liabilities (tenant sues for some random reason)?

- Can I set up a fixed option amount within the lease and capture any overages if I do end up able to sell after lease term?

- I think this is a better option than self financing with him at a lower value with added interest to get him to his price just due to time constraints on mortgage term plus the numbers seem to make more sense based on the passive income captured through a good lease deal.

- How do I avoid him from selling while under lease?

- Should I pay taxes, Insurance, and HOA fees myself to ensure they are paid?

As an owner...

- Will the owner be able to depreciate his property during the leasing term?

@tina 

@Account Closed Kurtis is correct about  out of state investors they are buying up like crazy. If you’re interested trying to buy look around UTC, if you can find something.  It could be a great strategy.  Student housing is very limited.  You could avoid commercial by purchasing a home and renting rooms individually.  My PM says he has an invester making 7k a month on a 7 BR home.  He’s also been able to rent to school clubs outside of sororities or fraternities.

Looking to start tracking our spending and investments and I’ve heard a lot about online aggregators in order to track all expenses and income under one system.  I am curious if anyone has looked into, used or heard about Personal Capital and is it a trustworthy system/company.  I’ve looked into it extensively and feel cinfident it’s safe but curious to here from others.

Thanks

James

Yeah I looked into purchasing it from him but he has the same mentality of many his age where he believes he should get the same value as other homes selling in the neighborhood just because he's in the same neighborhood and if not he'll just drag his feet.  Its still furnished as well.  The problem is that he has not done any updates since completion of the property in the 90's?? early 2000's?? and and all these other homes are updated (nicely I might add).  I figured the next best thing is to see if I can give him some cashflow while at the same time giving me some cashflow without the hassle of trying to get him off his sale price that he will never get.  Plus its easier to convince my wife to make a deal this way since there would me no risk on our part aside from dealing with tenants.  Baby steps. 

I can't do straight property management due to state licensure so that's why I was hoping I could bypass this by creating some form of partnership (50/50 or 60/40) where he retains the physical asset and I do the heavy lifting when needed. 

Although the master lease agreement sounds interesting and could bypass all the above issues.  A little more risk for the wife but not too bad.  I've known the gentlemen for 18 years and the home has no mortgage so there is no risk of due-on-sale claus from a financial institution on his side.  The only issue would be agreeing to a lease amount that would be reasonable since I know the hot water heater and HVAC units are 20 years old and I would have to repaint the whole interior and replace the carpeting.  Logic for the most part is out the window so I'll have to work at convincing him of this. 

Has anyone ever created a partnership with a vacant home owner (my mothers 18 year boyfriend) where owner retains ownership of the property and the other person (me) acts as a property manager for renting and they split the profits.

Since he is not making any effort to sell and its been vacant/unused for two years I think it could be a good strategy to partner with him to rent and manage (maintenance...would have a realtor find tenant) the whole process so we both benefit. I get the benefit of passive income without the process of mortgaging a home and he gets the benefit of someone paying his monthly and yearly expenses (taxes, ins, HOA, etc.).

Any thoughts on this?

Hope this is the right forum for this question.  Has anyone ever created a partnership with a vacant home owner where owner retains ownership of the property and the other person (me) acts as a property manager for renting and they split the profits.  

background:

  - Mortgage free

  - moved out two years ago 

  - Still furnished

- HOA fee $100 month

  - has an expectation of getting same value of homes sold in neighborhood that have been updated even though his still looks the same         from original build in the 90's.

  - Has not made any efforts to put it on the market or rent it per my suggestions (may be nervous about being a landlord)

Since he is not making any effort to sell I think it could be a good strategy to partner with him to rent and manage the whole process so we both benefit.   I get the benefit of passive income without the process of mortgaging a home and he gets the benefits of someone paying his monthly and yearly expenses plus some.