All Forum Posts by: Jill Lutz

Hello Todd,

I see that this post is a few years old, but would you be willing to speak with me about your experience? I have been contacted by a company wanting to lease my single family furnished rental on a long term lease for men recovering from addiction. I would love to hear the experience you had with your duplex and to find out the lease structure for leasing to a corporation that serves as guarantor (if that is how you did it.) Thank you!

Jill

Thanks for your reply @Canesha Edwards. I realize that when I posted this the other day, I was highly emotionally charged. After doing lots more due diligence, speaking to other realtors and property managers in the area, and realizing that I was being overly-conservative with my property analysis, I realized that this may not be a total home run, but that it's going to be at least a good base hit (to use David Greene's baseball analogy). So I'm going for it! I've been sitting on the sidelines for a couple of years now, and this place seems to have so much potential (but needs nothing immediate that would be overwhelming for my first deal). I also need a place to put some cash, and my window to purchase something is coming to a close (based on my W-2 ending). To make things a little more interesting (to say the least), my family and I are going to move into it for a few months while we furnish and make some improvements to it, and we realize we can cash flow $1000+/mo by renting out our primary home short term while we do that. (That doesn't hurt.)

As much as I thought about moving on, I couldn't let this deal go - there's just something about it.  Decision is fueled with a little more emotion than one just based on pure numbers, but it feels right. Thanks again for your advice. Wish me luck!

I'm under contract on a place in Hapeville right now. It's a higher priced property, and the Hapeville rents do not support it (will not cash flow as a traditional rental). It is a quality home, updated and needs no work done. It's on a huge lot that is ripe for an ADU and on an unfinished full basement that I can see us finishing into another bed and bath in the coming years. But purchasing it will wipe out all our cash, so I don't know what to do with it while we build up the capital to make these improvements. Do we rent it as-is and lose a little $ every month while saving up to finish the basement? We could even move into it for a year (max) and rent out our current place, but I'm still afraid that when improved, the rents are still so low in Hapeville. Could do the STR route as well, but that is risky adding in the cost of a full house of furniture on top of everything.

I am so torn, because I LOVE this area, I LOVE the house, there is so much potential here and so much improvement going on in the neighborhood, that I know we will see some great growth and appreciation in the next 5+ years. But in the meantime, do we sink our cash in now and barely break even waiting for that to happen... or do we bail and let someone else with a stronger stomach take the plunge?

(Due diligence expires on Monday, so I have the weekend to sleep (or not sleep) on it...)

Oh, and to answer your question @Nicole Harrington, maybe they are looking long term and at forced appreciation and just trying to take advantage of low mortgage rates. I'm not sure where you're located, but my lender is offering high 3's for investment property loans, so that could increase the cash flow if someone is getting a better rate. (?)

I'm wondering now if I'm being over conservative with my analysis approach. I I don't mean to hijack this thread (sorry). On this spreadsheet, I'm seeing 8% (1 month) for vacancy and only 4% for maintenance. In my analysis, I usually do 8% for vacancy, 8% for repairs/maint and another 8% for capex (+ (of course) more for tax/insurance/reserves/debt service). HUGE difference. Of course, I have not found one single thing in my area that even breaks even with this, so I've hesitated to buy. 

I own my own home and have lived in it for 5 years and haven't needed anywhere close to 8% of my PITI for repairs nor capex, so I feel like I'm being overcautious. Thoughts?

@John Lewis Thanks for posting this. I was wondering if/when someone was going to mention the Covid of it all. Sounds like an amazing event, but I'll have to wait til the last minute to possibly buy my ticket. :( 

This is a great question with some fascinating responses! I am not an engineer by trade (film industry for most of my career), but I have to agree that in a way, we are ALL engineers. Remarking with absolute total respect for those of you (most of you) who have degrees in and professional experience as an engineer. But there is something to be said that just about everyone on these forums is in some way working to design and build (thus engineer) their lives and their financial future.

:)

Hi Connor,

To me, it depends on how much you have to invest. I work in RE in Atlanta and I work in the film industry where I locate short term (3 weeks - 9 months+) furnished rentals for film crew and cast. The Atlanta market is very hot for this, particularly in certain neighborhoods of Atlanta near the Beltline (Inman Park, Old 4th Ward, Midtown, Cabbagetown, Reynoldstown). If you have the $ to do so, purchasing a property in those areas and getting a great designer, and you can expect $4K - $10K+/mo for rentals, depending on size and location (but you'd be looking at $400K+ for a 2 bedroom bungalow in these areas). Let me know if you're interested in learning more, and I'm glad to connect.

Definitely multi-family as well! Just getting started and not much capital right now, but excited to learn how to get started in the next 6 months.

Hello BP Family! I'm a real estate agent in Atlanta, Georgia. I'm looking to start investing / flipping for myself and have come to BP to gain make connections, gain some knowledge, share some knowledge and find a little inspiration. I look forward to connecting with you all.