All Forum Posts by: Jim Goebel

@Nathan Gesner

We're in a much better position having gotten into real estate investing.  Are you saying you advise that we should have not?  Are you saying we make bad investments?  

Are you saying that anyone that doesn't go 'all the way' (whatever that means) with a project is has not made a wise investment?  Are you saying that if someone has the aptitude to figure out, as an example, that a solenoid valve is what is causing a furnace to not go consistently through its startup cycle, and the three people that come in and 2 recommend a full system replacement, and it happens that the third, (or the owner, myself, or OP) figured out the $30 part that failed early and can take the half hour to fix it, you would say that person who didn't replace the whole system for no extra value, made a bad investment?

I honestly see a lot of assumptions inherent in what you're suggesting, and readers can judge for themselves the merits of the responses on BP.  I'll leave it there.

By the way, I'm not assuming anything about the OP's situation.  I'm pointing out logical fallacies based on personal anecdotal experiences that allow for conclusions that are the result of oversimplification.

@Alex G.

Agree with Alex.  Figure out where the water is coming from!

@Daniel Porter

Replacing sub floor may be more of a project than you're prepared/bargaining for but in my opinion you do want to address the cause of the issue, wherever that takes you - as it sounds like you'll be owning the asset for a while and if it were mine, I'd feel much better about that asset being soild/holding its value.

@James Krusmark

This advice may be enigmatic and non helpful for your current situation, however consider the importance of intent.  Consider that before you locked into a 'strategy' with this house (ie: made the decision) you could have gotten a regular homeowners' policy.  Next, consider that the next time you think about doing something, think about the order and think about how you can not lock into your 'intent' so that you can ensure that you can defensibly get that homeowners' policy.  If you continue on in RE investing there will be other examples of this advice where it'll be apt and valuable.

@Jim Young

@Nathan Gesner

@Joe Villeneuve

I disagree with Nathan and Joe, but it would depend on your circumstances and constraints as to what I'd advocate.  For instance, how much money are you saving, and are you severely constrained with cash right now? IE what are your other options with that cash you'd be saving?

From what you've shared, it sounds like a reasonable option to replace one side.

Nathan/Joe, there were times early on when we were investing where we were very, very, cash constrained.  If we had pulled the trigger on one $7,000 roof replacement, instead of buying $50 bundle of shingles and patching, we might have been dead in the water from an operating cash perspective.  I feel that you two are making certain assumptions about Joe's constraints.  Just because you've gotten to a point where you use the 'go all the way with it' as a default heuristic, that does not make that 'right' and in fact, can lead to assumptions that lead to wrong decisions, especially for new investors who tend to have a very different mix of time and money constraints.

@Kevin Reinell

Worst case, the AHJ makes you tear it down.

Best case, there's no issue at all.  

I'd bet you'll be somewhere in the middle :) It's going to be hard to predict how the authorities will play their cards ahead of time.

@Suho Bae

Can you just get the income, and wait the year?  I'm sure there's some good books that need your attention in the meantime.

@DG A.

I definitely don't think it's a deal breaker.  Like any foundation, you want to look for signs of stress, water, or shifting.  Some pure brick ones hold up great.  Others, not so much.  Our first purchase in the Des Moines market had a brick foundation in pretty good shape, and it was built in the early 1900s.  I can't speak to your local codes, but I can opine that if your AHJ 'makes' folks replace a perfectly good brick foundation, they are not adding any value or helping anyone.  Of course, that wouldn't be the first time!!!

@Jarrod Deshields

Life constraints are real.  I don't have any real wisdom for you, other than to try to encourage you.  The times I was doing things outside of my regular job were all building to something.  You don't know what is while you're doing it, but Keep the Faith!

@Aaron Rowzee

I haven't gone down that road. We've built and rehabbed with cash, usually drawing from a LOC. I'd recommend that - as what I understand of a construction loan - it's a bit of a process. Of course, I tend to be (overly) involved in stuff and if that process controls your product a bit more, it might not be a bad thing.

@Sharbae Terrier

What market are you in?  Do you know how to look at the numbers and evaluate deals?  If not I'd get some practice with that.  Build that $8k up to where you can put 20% down if you can.  That'll give you nice long term financing options as an owner occupant purchase.