All Forum Posts by: James Suleski

    I Just read Jay Scott's est. Rehab costs and while it is a great book for a novice such as myself, I would like to gain some experience putting these methods into practice before diving in on a rehab in the future armed with only book knowledge.

     If you are doing scope of work/ estimation in the Harrisburg, Dauphin, Cumberland, and Lebanon area I would love to shadow you on your  next scope of work and estimation. Would be happy to bring coffee/lunch of your choosing on site or pick up the tab for lunch someplace. My hope is to gain some insight into local materials/labor pricing,  unique rehab challenges in older homes, and possibly see analysis for some of the creative value add strategy talked about on the podcast these days. 

-Jim

I am not an expert and in fact have not moved out of yet what I intend to be my first rental we bought this November in Hershey. Out closing costs were significantly more than 2000 though. Just curious on how many units/bed/bathrooms the property had? Slatehouse PM has a good rent calculator called accurate rent for Harrisburg areas(including Dauphin co) you can use in addition to Zillow and Trulia to verify monthly rent for units matching the property in question. Maybe some experienced investors can weigh in but 5% for Cap ex seems possibly low for the age of the house but don't know when/if it was redone? Also on the vacancy I spoke to a local PM who has investments himself and his thoughts were that when you get 6-7-8% that is not desirable as an investment. My wife and I have been talking to PM's and researching the palmyra, hummelstown, Hershey market for a year now and I would think vacancy would be lower than 8%( as mentioned by David Wenger above there are good schools/employers) but AGAIN I have no rentals yet. I just say this from asking PM's, looking at availability on Zillow/trulia, and using MSA's and sperlings best places to compare markets locally. I would call a Broker, a PM, and ask them what rates they are seeing for vacancy and even ask about cap ex in similar house styles they may know esp PM's.

Oh I see what your saying, well i'm not an expert just starting out as well. Now I understand the numbers better, thanks.

This is probably a newbie/simple question but I can't understand why the re-fi loan amount jumps up to $120,000 assuming 37,500 original loan balance + $45,000 in rehab financed by hard money lender. I don;t understand how you using roughly 82k of the Hard Money lenders cash turned into you owe 120 when you refi. I did not add in other costs assuming you are paying PITI out of pocket during the rehab. any explanation would be appreciated.

Thanks and good advice!

 I figured that there may not be any better options for putting the money to work but wanted to check with more experienced folks and your input is appreciated. What you all are telling me is consistent with what I have read a few places. It seems like you guys said, access is the most important thing and exposure to markets or approval to HELOCS both jeopardize access to the amount of money you set aside in some form or another. 

Thank you guys!

Greetings All,

   I am a newbie investor and am currently living in the first property I plan to rent upon moving out. With this unit and future investment properties, one of the questions on the forefront of my mind is cash reserves. No one wants to lose their rental property or not be able to fix it. I struggle less with how much to keep in cash reserves because it seems like from what I have read 6 months P.I.T.I and depreciating the cost of major repairable items to a monthly expense based on their useful life in months will suffice. What I struggle with is the fact that this is a sizeable amount of money to have in the bank losing money to inflation.

My question is are there any better ways to put this money to work than a bank account earning 1-2%? I thought of putting this money into the mortgage and increasing my cash flow a bit through a non-refi amortization adjustment with the bank and then HELOC if I need it later. However it seems from reading other posts on the forums that this may not be a great idea regardless of having a fixed or adjustable mortgage interest rate? I would be interested to know how the seasoned REI of bigger pockets put these cash reserves to work or at least stop them from losing money to inflation. Any advice or creative strategies employed by other investors would be appreciated and very helpful.

-Jim

Hey Bigger Pockets!

      I am a newbie investor who has read a few books on general real estate investment and financial metrics. I am beginning to analyze deals in my area  using the calculators available from BP. However, it occurred to me I skipped a step and need to know which markets to invest in. I was looking to see if anyone could recommend good books on real estate market demographic analysis to add to my growing reading list?

-Jim