All Forum Posts by: Jim K.

Pursuant to what @Drew Sygit just said: the last building we bought, there was a tenant there who got in by misspelling his last name and never presenting any ID. So when the for-crap property manager ran the false name, no information on this prospective tenant came up. I noticed this upon buying the building, insisted on seeing ID, got the proper spelling of his name, and found four evictions. This was a relatively stupid professional tenant, thankfully, as the idiot has appeared under two different names in front of the local district magistrate over the years. I leveraged that to get him out.

@Jamie O'Connell

I grew up in Horseheads. I can see how you're making it work your way in Elmira. I suspect in a more urban area, with a lot more entrenched and generational poverty, things would be a bit different. But good luck on the Chemung County Section 8 Express as long as you can ride it.

If you watch the scene in The Exorcist where Father Damien Karras is with his mother, the radio is playing an advertisement in Greek for Astoria Park.

With an endorsement like that, who wouldn't want to live there?

@Andy Okamoto

One cautionary note: if your idea of "cash flow" is $10K in net operating income, $120K before taxes in your pocket every year off your rental property, well, if it happens to you in 10 years, it will be a low-probability event with a lot of lucky breaks and eventually will likely ruin your life when you make a misstep because you assumed your lucky break was the norm.

If you're serious about moving out here, at least look at the Pittsburgh area and its proximity to Carnegie Mellon (tech) and UPMC (health care).

@Rashad Shepperson

"She just does not want to be bothered..."

Gee, the apple didn't fall far from that tree, did it?

Your best best is to find a local real estate lawyer to handle the legal transfer of the wooded land that your mother wants to give you. How to convert that land legally into a mobile home park is something you'll have to learn elsewhere.

 Is it me, or does anyone else have a sudden hankering for a McRib?

@Steven DeMarco

@Jay Hinrichs

This discussion actually has real meat on it. Sorry for taking so long, but I've been having my own growing pains.

One of the things we're not really looking closely at is the hyperlocality of Pittsburgh, a fundamental understanding of the unusual nature of this place and how, through insularity and other factors, it tends to punish long-distance investors. My sense is that Steve is running into quite a bit of this.

Jay, the answer to your question of if I know any $200K and under locations here that would make sense as an STR, yes, I do, but a lot depends on how the property is marketed, how it is furnished, to whom you make it appeal, how long you have to build up your business, how much work you're willing to put in. From the long-distance, out-of-state perspective -- no, not many location. As a sideline to a regular local self-managing small landlord in my position, oh, very much so.

Anyway, Steve, I'll send you a connection request.

@Renee Stark

Sometimes you just have to throw all the advice to the contrary in the backseat and just do something. I'm very glad you decided this wasn't the time. Good job. Since you do plan to go ahead investing elsewhere, the best piece of advice I have for you on that is to make sure you have people in the ground whom you can trust absolutely to do what they say they will do. I have rarely seen long-distance renovation outfits make it here in Pittsburgh, for instance, without a brother or cousin or lifelong family friend as the onsite property manager or overall reno GC of the investor. And just because the investor and the lead person onsite are related is no guarantee of success by itself -- the lead person also has to be thoroughly competent.

@Renee Stark

Your first investment is going to be a BRRRR property about eight states away from you. As far as a reliable team in place goes, you have a realtor, you're working on a contractor (but you plan on getting several bids), and you suspect you want to hire a property manager in Georgia. I can immediately think of four problems with the plan.

1. You mention nothing about your personal understanding of the renovation process.
2. You offer no details of the property itself.
3. Your renovation budget is maybe around $90K of your your retirement savings. What you're basing this figure on is unclear.
4. You make no mention of perhaps the most important problem with your plan from a contracting standpoint...today is August 7.

I'm sorry, Renee, it really looks like you're about to get screwed. If you don't, it will be close to a miracle, and then you'll just take the wrong things you will have mislearned from an abnormal result to your next project and get screwed there.

Long-distance renovation-for-profit is very hard. Doing it hands-off and entrusting the management to a general contractor with additional oversight by a property manager is even more difficult, especially when you don't have a long-term relationship with any of the people doing the work, with years of built-up trust and respect between you. A lot of that trust and respect comes from whether or not you actually know something about these people and what they do. I have to say that given what you've written, it really seems likely that you don't, especially given the very big detail that you're overlooking in this whole discussion.

It's August 7th, and the property is in Georgia. The best people for this work have been booked solid since the middle of March. Any local GC who has time to spare to pick up a major project like this right now will be at best highly questionable. Any subs the GC finds with enough free time to handle the work will be even more questionable. Could it go right? Oh, sure. But that's a low-low-probability outcome.

Yes, I understand that you have to learn somewhere. And you will probably lose money going through the learning curve (as an investor, I was no exception whatsoever to this). But starting out as investors in residential renovation this way, with the stakes this high and so many chances for things to go wrong, it just can't be your best option. I think there are better ways.

Whatever you choose to do, good luck to you.