All Forum Posts by: Joel Allen

@Dillon Squier

Have you looked into the DoD SkillBridge program?  It enables active duty members transitioning out of the military to spend their final 6 months on active duty doing an internship with a civilian company.  It's designed to be a win-win...the service member gets the opportunity to build their skills & resume for their transition to the civilian sector, and the company gets a 6-month 'working interview' with a potential employee who brings valuable work ethic and leadership to the table.

There are quite a few real estate companies that are already vetted SkillBridge partners...if you were able to do an internship with one of those companies it would provide you some valuable experience and training, while still having the 'safety net' of being on active duty until your date of separation.

The site with some additional info about the SkillBridge program and the list of approved companies is at:  

DOD SkillBridge - Authorized SkillBridge Organizations (osd.mil)

 

@Greg M. makes some great points, especially in regards to location and schools.  The property is located in the southeast region of San Antonio, and it's on the exterior of that region (outside Loop 410).  That area hasn't yet developed and grown in the same way that much of the northern half of the city has, and the level of infrastructure investment has lagged behind.  

This has led to 3 disadvantages you're working against:

1.  Many of the larger employers in San Antonio are located elsewhere in the city...your property is 20+ minutes to Fort Sam & Toyota, as well as 30+ minutes to Randolph, Lackland, USAA, UTSA, & the Medical Center.  

2.  Many of the stores that most people desire to live in proximity to (HEB, Wal-Mart/Target, Costco, etc) haven't yet expanded to the southeast beyond Loop 410 toward this neighborhood.

3.  The schools that service this area are below-average (ratings of 2/10 or 3/10) compared to other areas of San Antonio.

If the rent comparables that your property manager is based solely on square footage or bedrooms/bathrooms, but isn't considering the specific area of the city, that could be a factor.

San Antonio has a strong demand for rentals right now. How is the PM marketing the home? Is it listed anywhere besides Zillow (MLS, etc)?

I agree with @David Lambert …if you can post the Zillow link we can provide more viable perspectives on neighborhood, presentation, pricing, etc.

@Joshua Martin

Exactly right…the survey will not only show the property boundaries but will also identify any easements, encroachments, and setbacks.   All of those are important to know, especially if you intend to add square footage to the home, add a deck, add a pool, or construct other improvements on the property.

I grew up in Bloomington and still have family in the area.  Check in with @Account Closed…he’s an investor in the city and also owns a property management company (Dowd Properties).  That may be a good fit.

I had a conversation with Michael a while ago and was impressed by his experience and knowledge of the Bloomington/Normal market.

FHA financing has owner-occupancy requirements that are very clearly described within HUD 4155.1, Chapter 4, Section B.

"FHA security instruments require a borrower to establish bona fide occupancy in a home as the borrower's principal residence within 60 days of signing the security instrument, with continued occupancy for at least one year."

There are some exceptions listed, but they are tied to significant life changes (military or job relocation, increase in family size, etc.). The intentional act to obtain FHA financing with no intent to occupy is a form of mortgage fraud.

@Brian Poirrier makes a great point about the property tax change.  The way South Carolina calculates property taxes for primary residence vs. non-owner occupied leads to a significant increase in property taxes when you move out and turn the property into a rental.

The residence’s market value is multiplied by an assessment rate (4% for primary residence vs. 6% for non-owner occupied), and then the local millage rate is applied to determine the property taxes due.

Once this is calculated, it could lead to the property taxes on the rental being 3x higher than when it was your primary residence. 

If you want to learn more, the South Carolina Chamber put together this deep dive guide:  

https://www.scchamber.net/clie...

@Evan Huiting

BiggerPockets has a YouTube channel with tons of videos and content.  

One of the videos shows Brandon Turner analyzing a property in about 10 minutes.  The video is one of the more popular BP ones with over 400K views…YouTube search

“How To Analyze A Rental Property (The Quick & Dirty Way)”

If you want to watch a more in-depth deal analysis from Brandon, there’s a 40-minute video…YouTube search “How to Analyze a Real Estate Deal LIVE with Brandon Turner”

@David S.

A few tips that I've picked up over the years:

1. Minimize unnecessary landscaping - Too many bushes, shrubs, and specialty plants are unlikely to be fully maintained. Depending on your location and climate, consider low-maintenance options such xeriscape, rubber mulch, etc. In particular, remove all bushes around the outdoor HVAC condenser unit...they'll get overgrown, restrict airflow to the condenser, deposit debris into the condenser, and ultimately make it less efficient.

2. One of my rentals has hardwood floors (was already installed when I purchased the home). I installed a built-in shoe shelf/bench inside the front door to encourage the tenants to remove shoes when entering the home. I also require all furniture placed on the hardwood floors to have felt pads placed under the legs. Dirt/sand/pebbles on the bottoms of shoes and furniture legs sliding across the floor can both do significant damage to hardwoods.

3. If the power gets knocked out, the tenant's first concern isn't going to be whether or not the sump pump is working. So I had a sump pump battery backup installed. It activates whenever the primary pump is not working (e.g. power outages) and continues to pump water preventing a flooded basement. Make sure you choose a sealed battery (which is virtually maintenance-free) vs. wet battery (which require periodic refill of distilled water). It's a few hundred dollar initial investment, but well worth it to prevent a multi-thousand dollar basement repair later.

@Aaron Ver

A few thoughts to consider:

1. Have you run the numbers to determine what your cashflow will be on the home if you turn it into a rental? What's the market rent for comparables vs. the expenses (PITI + maintenance + vacancy + CapEx, etc)?

2.  Has the home been your primary residence for at least 2 years?  If you elect to sell, that will determine if you can take full advantage of the Section 121 exclusion (excludes the profit of the home sale from taxes).

3. Have you checked your VA Loan Certificate of Eligibility to determine if you have remaining secondary entitlement? If so, that may provide an avenue for another no-money down VA loan to purchase a primary residence when you move to Newport.