All Forum Posts by: Jessie Harrison

I have my first rental property under contract, which is a SFH and a duplex (one floor of the duplex is completely gutted). However, the property is 3.5 hours away from my city of Houston in a small town of northeast Texas. Recent internet searches of the economy of this town point to the underwhelming economy, which is heavily tied to oil and gas. I realize this may sound like a bad deal, but I purchased the property for $55k (conventional loan, 20% down) and it needs about $20k of improvements to get 2 of the 3 doors ready for rent. Given that my mortgage, taxes, and insurance will be less than $600/month, I feel like this property could cash flow very easily if occupied (one unit could cover all expenses). Estimated cash flow of $400/month (including property management fees). Cash on cash return would be around 13%. That's better than S&P500, but is that too weak for real estate?

However, this small town has a high level of rental inventory on the market because it's once rapid growth and now weakened economy.  Should I walk away from this investment or take the chance and be in good shape if I can get it rented? I am so excited to have my first rental property, but maybe I should wait to find a better option. Your advice is much appreciated.

@Mary Evans I am new to Bigger Pockets, but am in the process of purchasing my first investment property in Longview. I was curious if  you have rental property in Longview and if so, how is the market? I've done a lot of research (as much as publicly available) and everything seems to point to the Longview economy suffering really bad. I just want to gain some comfort that I'll be able to rent out my SFH. If you have any additional information that you can share, please advise. Thank you!

@Cynthia Long@Wes Brumit I am new to Bigger Pockets, but am in the process of purchasing my first investment property in Longview. I was curious if either of you have rental property in Longview and if so, how is the market? I've done a lot of research (as much as publicly available) and everything seems to point to the Longview economy suffering really bad. I just want to gain some comfort that I'll be able to rent out my SFH. If you have any additional information that you can share, please advise.

Upen Patel I'm looking for financing on multiple units. I am acquiring a SFH and a duplex (both on same plot of land and same physical address). I'm not sure if your recommendation works for this particular case. Please advise on your thoughts.

Thanks John. Let's assume friends and family are out of the equation. Is a construction loan the only viable option?

I am purchasing an investment property through a conventional loan (standard 20% down payment). However, the property needs about $20k-$30k in renovations. I don't have the option of taking out equity in my primary residence. What are some of the best options to fund these renovations? 

Thanks for the feedback. The duplex was poorly built, as the ceiling is less than 7ft tall. This is my primary concern on the first floor unit. I'm just thinking it will be challenging to get a renter with ceilings this low. But point well taken about not cannibalizing a full unit if it has potential to be rented. 

Just for the sake of clarity, the SFH is fine. I'll be updating it and renting it out. My concern is with how to maintain the duplex. The SFH and duplex are spread out and the property is on 3/4 acres in a rural town in east Texas. The main issue is should I keep the duplex as is and remodel the first floor (shown below) or should I just combine the first floor bedroom with the top unit, which is in much better condition. The cost to get the first floor in renting shape is around $20k, while the cost to just combine the two floors is $5k. The cost difference is because I would not use the entire first floor unit, which has a bathroom and kitchen that also need to be updated. If I were to combine with the top unit, I would just wall off everything else and consolidate the bedroom area from the bottom unit. Hope that provides a little more clarity.

New to BP and first time post. I have purchased a rental property that includes a 2,000 sqft SFH and a stacked duplex (both units are 860 sqft - top floor is a 2/2 and bottom floor is a 1/1). The bottom floor of the duplex has been completely gutted due to prior leakage from the top floor. It also has ceilings that are lower than 7ft (as does the top unit). Also, the top floor is basically move-in ready.

 I am considering making the top floor a 3/2 by consolidating the bedroom from the first floor to make this one unit.  My logic is that is may be more cost effective in the short run.

As it currently stands, I think that the top floor duplex could rent for $650.  I think the bottom floor (if updated) could rent for $400. It will take around $20k to make the entire bottom floor move-in ready, whereas it will take less than $5k to make the first floor bedroom a part of the top unit.  If this option were done, I think the unit could rent for $800.

Please let me know your thoughts and suggestions.  Thanks for your help.