All Forum Posts by: Jeff Ronningen

@Bridget Poston. 1) search in BP for anything in Marietta, set up key word alerts for Marietta and Ohio

2) Marietta isn’t that big and most mulitfamily properties for house hacking are probably near the city core, search online and on county auditor website for multi families and rentals, drive and walk the area, look for rental signs and call them, identify multifamily property addresses and research them, network with owners

@Ricardo Navarro. Cheviot is a working class neighborhood. I don’t know it real well and I choose not to invest there. I’m more on the east side, Cheviot’s on the west side.

@Ricardo Navarro

The big ticket items are roof, electric, hvac, plumbing, foundation. Ask and observe what you can about each. Take pictures and notes. Talk to an expert after.

@Idan Narotzki. You didn't specify but I assume you paid to have an inspection done before buying. If so, you missed the opportunity to use the 20 year old water to negotiate a price concession. You may have gotten a few hundred bucks. All in replacement would be less than a thousand. Inspectors usually provide value but this one missed by not noting the age of the water heater. That sounds like home inspector 101, everyone knows a 20 year old water heater is beyond its useful life. You could ask the inspector for a partial rebate of their fees. You could also write them a bad review online, which they probably deserve, and do a service for your fellow REI's.

@Joshua Gonzalez. I think you misunderstood. One very important criteria lenders use to qualify borrowers is debt-to-income ratio. For the property you want to purchase they will use 100% of expenses (PITI etc) against you on the debt side and only use 75% of the property's rental income on the income side. As a 19 year old you're going to have an uphill battle getting financing. Talk to and network with lenders to find out if and how it can be done. I admire your ambition, it may not happen as quickly as you want. Develop a plan, work through the details, stick with it and see it through to completion. Doing that sets you apart from most people running the rabbit wheel.

@Keleisha Carter. Depends on a person's business model and goals. As a buy and hold investor looking to build income streams I prioritize cash on cash return but I also factor in other metrics and criteria. A flipper or wholesaler might focus on ARV.

@Jaron Walling. He’ll have $38K of net worth on paper that might generate $78 per month. If you like that return and you’re looking to buy I have several properties for you.

His research was top notch. Other than not knowing market rents and using bad estimates of expenses, it was outstanding.

@Nicholas Morgan. Let’s say the property was rehabbed and worth $130K as you suggest. Would you be willing to come out of pocket with $38K and borrow $92K to realize $78/month positive cash flow? Viewed through that lens it’s 2.5% Cash on Cash.

I think your research is insufficient and your business model isn’t well enough defined.

I’m local and I’ve got decades of mistakes, expensive lessons learned, and tenant nightmares on you. Glad to discuss by phone or over a drink. I enjoy teaching and mentoring.

@Edward Robinson. Tax value means next to nothing. Realtor assumes a lender would value it higher and thus be willing to lend you more, put zero credence in that load of manure. Forget about trying to get some guarantee on valuation. Trust your own numbers. You planned on having $51K all in at least. $1K more is less than 2% variance. That’s nothing in this business, it can’t be measured that exactly. If you like the opportunity at $51K you should still like it at $52K.

@Steve Richardson. I don't think it matters much in terms of the valuation for the refi. Not only that but the math doesn't work very well. Let's say you could replace all for $10K and it increases the appraised value by $10K. Assuming 70% LTV that gets you only $7K more theoretically from the refi. So spend $10K, get $7K. I assume you're doing the refi to raise cash for other purposes and this doesn't help. On the other hand if you want to do the improvements for other reasons, then that should drive the decision. And you could do the improvements after pulling cash out as opposed to doing additional borrowing. Have you asked an HVAC technician for an opinion? Are your bills high because existing systems are inefficient? Are you having to do regular service calls? Are there incentives in place, such as tax credits, to go high efficiency?