All Forum Posts by: Jeff S.

Check the laws.  In some cases I think it can be better (legally speaking) if you don't know.  If a professional determines that you do have some kind of environmental hazard (lead paint, asbestos, ...) then there can be more stringent requirements on disclosure, remediation, etc.

IANAL.... 

As mentioned, it depends on what YOU want.  Many here on BP want to grow as big and as fast as possible.  For that, you would definitely NOT pay off any properties.

If you have more modest goals, and just want to reduce your risk and headaches, paying it off might make sense.  One property earning $500 is WAY better than 5 earning $100 in this respect.

Keep in mind that in an era of increasing interest rates and (possibly) inflation, having long term, low interest debt is a good thing.  Why pay it off with "good" dollars now when you can pay with "cheap" dollars in the future.

Any chance you'd be willing to move? You could do a FHA 203(k) loan for low down plus renovation costs. This will limit you some (can't pay yourself for labor, more red tape) but might open up some possibilities.

One variation on house hacking is to buy a SFH and rent out a room or two. For younger people sharing a house with roommates isn't that uncommon.

With this approach you would be able to afford a slightly larger/better property (don't overdo it!) and have more appreciation than a small SFH or typical MFH. You would have a little more cash to set aside each month. And you would be learning many crucial landlording skills.

I'm no expert but the one thing that made me wince was the white formica counters.  Replace them with ... ANYTHING.

Seems like the best approach would be to just shoot the guy.  A true win/win.

Even after a whole year, I applied for a HELOC and the "appraisal" came back exactly equal to my purchase price, despite the fact that I bought below market and it was a pretty "up" year.

Thanks, Daria.

I never knew you could "date" a WH or furnace from serial #.  Makes sense!

Now if you could only do that with a roof!

Actually roofs are very tricky here - we get crazy intense hail sporadically.  Last summer was crazy with roof replacements.  

I'm in the learning phase before buying my first rental.  I'm thinking I will do a fourplex, owner occupied.  I've found a target neighborhood where the numbers (1% rule, 50% rule) seem to work and the tenants are desirable.   The area is all boxy, mid-1980's roughly identical fourplexes. It seems that that age is right around when the effects of good/bad management begin to really show - some units are a little ragged, some pretty nice.

What I want to learn is how to be precise about capex estimating. I can think of a few ways:  please tell me how YOU recommend estimating capex.

My ideas:

1) Just use a trusty fixed % of purchase price. (How to choose that % for my market?)

2) Look at records from seller. (Can you trust this at all?)

3) Look at records for similar properties (How do you access this?)

4) Ground up approach: (cost of roof)/(useful life of new roof) + ditto for HVAC, paint, landscaping, ... 

5) Similar to (4) but inspector determines remaining useful life of roof, paint, HVAC, etc. and timetable for updates is established.

6) Other?

Several of these require that you have a specific property in mind and under contract, whereas (1), (3) and (4) four would work for a blanket area of similar candidates.

All applicants must be heroes.

Mom?  check

Firefighter?  check

Nurse? check