All Forum Posts by: Joe Ludwiczak

They haven’t but they’ve been good tenants so I want to do right by them. Just not sure if there is a standard approach in these situations. 

thanks @Chris Seveney!

I recently bought a new primary residence and kept my starter him as a rental. Things have been great but last month we had a burst pipe in the basement of the rental. The basement is half finished and the tenants kids use that part of the basement all the time. Based on the damage I need to replace the floor and it’s taking close to month to get it all done. During that time the tenants have been unable to use the basement. Is it appropriate to discount the rent for a month based on the loss of usable space? 

Thanks @Alexander Murillo - that’s an interesting angle with the heloc. I can totally understand how the 40% down is counter intuitive if you’re in growth mode but I’m not looking to scale in that way, possibly ever. I like the positive cash flow now and having a couple of properties that I’ll hold for (likely) decades and will appreciate well overtime. And at the end of the day, I’m still financing the larger down payment via the cash out refi on my original property so it’s not, in my mind, the same as having worked to save up over time for that large down payment. 

As I’m newer to this, I’m sure I’m missing things but appreciate all the feedback. 

Thanks @Chris Seveney  - it’s definitely an expensive area but one that has a good track record for appreciation as well as lesser price drops during historic market declines. I’m definitely looking long term and don’t have aspirations (at this time) to scale up quickly. My aim is to build a portfolio of 4-5 properties (likely single family) over the next 10 years. So in my mind, by putting the additional money down I’m not eliminating my ability to move on another rental acquisition in the short term and I like locking in a lower mortgage so I have a nice buffer on cash flow if rents go down (they are quite high at the moment). 

I can certainly appreciate the broader feedback on not locking up the money. 

Thanks very much 

Last year I opted to turn my primary residence into a rental and purchase a new primary residence. In the next year or so I’d like to acquire another single family rental property in my immediate area. At the moment however, the prices are so high that I don’t think I could get good cash flow with 20% down, even with rental prices elevated as well. 

My plan was to do a cash out refi on my current rental (ie my original primary residence) and I have enough equity there that I could take out enough cash to put down 40% down on the new rental I’d like to acquire. I’d still be nicely cash flow positive on the current rental and the 40% down on the new rental would set me up to be cash flow positive there as well. 

Is that a bad idea?