All Forum Posts by: Jason Maguire

I'd go with a stricter cancellation policy. How are you going to be able to rent the unit out with less than 24 hours? Can definitely happen but is probably super unlikely & you will be the one losing money, not the customer who most likely doesn't care at all, as long as they get their money back.

I think Carolyn made a good point & a structure similar to hers would work. Definitely don't want to punish people who are cancelling more than a month out, but anything in between is going to cut into your bottom line.

I don't think it's the tenants responsibility to grab the remaining two sets of keys unless they were explicitly told to pickup the keys for the other two girls. 

Kind of a crappy situation but i would eat the cost of changing the locks. Best of luck!

Hi Pallavi,

There are many other factors to consider when purchasing an investment property other than the price of the house & what the rents would be.

Some things to take into consideration are: Do you plan on using a property manager? What interest rate/ loan are you looking to utilize? What area is the neighborhood in, is it appreciating rapidly or is it a class C/D neighborhood? Also, are you budgeting for CapEX, Vacancy and Maintenence?

Bigger pockets has a calculator that you can use to help you better crunch these #'s. I'd suggest taking a look at that and really getting into the nitty gritty of the #'s & then make the decision if the property is right for you.

-Jason

Hi Felix,

This may seem silly, but if you don't plan on using it until 2023 then does it make more sense to just hold off for a little longer before you pull the trigger on a HELOC? I specifically like working with fixed rates only, but variable does give you the flexibility of lower payments if rates do go down.

I'd recommend holding off until you are actually ready to purchase a house, and then make a decision at that point if fixed or variable makes more sense for you.

-Jason

Run your analysis based on the current #'s. If the analysis doesn't make sense at then move on- let the #'s talk.

Also, William brings up a good point as well. Securing financing will definitely be more difficult if the prop is extremely run down & beatup. You would most likely have to switch to some type of hard money loan at that point.

What type of condition is the property in? I think 25% seems high for CapEx, Vacancy and Maintenance. I generally budget 5-6% for each of those categories & in the 2 years of owning rental properties, I've actually come in at less than 5%- but like i said, that is kind of dependent on what shape the prop is in.

Also, for the PITI portion- did you pull taxes for the property direct from the town/ city website? Sometimes it's hard to get the actual tax # off zillow, realtor so if you haven't i recommend getting the exact # from the town.

 And you can already kind of tell that the raise in interest rates hasn't curbed demand too much. Trust your instincts. Thank you for your service! @Kendrick Pratt. 

FHA 3.5% down & house hack. Or seller financing of some sort.

I think a lot of people will chime in on this one, but as of now even in the current economy, prices still aren't going down on houses. Yes, there may not be 30 people bidding on the same house, maybe it's now 10. Supply as a whole is still really low, which is why you haven't seen the housing market affected too badly yet, minus the interest rates.

Even with interest rates, run the #'s on properties & if they still make sense, then i don't see why you wouldn't move on it. If anything, there is probably not a better time in your life to house hack & save a little money from inflation. If your rate is that bad, you can always re-finance the house when rates drop back down. Just my thoughts though.

-Jason

Talk to local investors in markets where you are looking to invest- Real Estate is a solid investment all around so i don't think you need to go cross country to find something that suits you. Don't just look at cash flow, but also look into a market where there is solid appreciation.

Yes, there may be more cash flow in areas like the Midwest, but if you are that far away & arne't able to self manage than you will most likely lose 10% to property management. Just something to keep in mind.