All Forum Posts by: John Thomson

@Nicholas Weckstein One of the major advantages of the mini-split system is that it does NOT require traditional duct work. It’s probably not ok to put a link here but you can google mini split and any number of company websites will show up with videos that explain the system and installation process in just about any level of detail you like.

@Sarah Brown

I'm not sure how the HELOC route would work. If I am at 70 to 75% of ARV less acquisition costs and repairs, it doesn't seem like there would be much room left for the HELOC. Based on my own market analysis, I expect an ARV of $180,000 to $185,000. The slab is cracked and there is some settling in one corner. It seems stable but I will have a structural engineer and foundation repair contractor look at it. I'm putting $20,000 into my numbers for just that but we'll see what the experts say. The three bathrooms are from 1966 and in rough shape. The kitchen had a recent update but could use new appliances. The boiler and central air conditioning unit should probably be replaced. There are some other cosmetic improvements I'd like to make. I'm making a middle of the road estimate of $68,000 to $70,000 for the rehab and acquisition cost. So, say I get the place for $65,000. What would value would be used for the HELOC?

@Whitney Hutten

Thanks for the link! Good food for thought.

I am looking to BRRRR a sfh. The numbers look good assuming I can negotiate the right price. I am certain I can get owner financing. The owner has 100% equity and is not living in the home. She is just paying taxes and insurance on it while it declines. Would I be wise to go for owner financing and arrange a separate rehab loan or look for a single loan for purchase and rehab? Would it be common for a rehab lender to take a second position on the mortgage? Is there a better approach?

I’m currently dealing with a similar situation in Georgia. The trailer belonged to the deceased mother. Her son quit paying rent and moved out. Fortunately, Georgia just enacted a law last May that gives property owners an easier path to taking ownership. Basically, I had to contact the local municipality and request that they send someone out to determine whether the trailer is “intact” (habitable) or “derelict” (not habitable). They have 20 days to provide a report with their determination. Combine this with evidence that the property has been abandoned: disconnected utilities, tenant moved out, most possessions removed etc. The city and I have to provide notice to the trailer owner that the trailer is considered abandoned, and I am taking possession. He has 90 days to request a hearing. If he has not responded in 90 days, the trailer is mine to dispose of or rehab. If he responds, I am entitled to all rent and penalties due, or I can take possession of the trailer. The city was not aware of the new law. I have no idea what relief is available to landowners in other states, but you should check state, city and county statutes. 

@Kam Mill Do you really think you need to put hardwoods in and remove popcorn ceilings in section 8 housing? Are you painting the ceiling because of stains? Water damage? Smoke? Your numbers sound great! You should be able to do a cosmetic rehab and come out pretty good on cash flow.

I always look at Bankrate.com. You can enter the zip code and the specifics of the loan you’re looking for. They also have some interesting graphics. You don’t have to provide any personal information unless you actually want to apply. 

Thanks for all the advice, everyone. I will give it a go. If I discover any new secrets, I will pass them along.

@Lindsay Linton, you’re in the big city compared to us. Our property is near Soperton! It's not the market I would choose to invest in, but it’s the one we’re in.

Thanks, Will. I have used those to get an idea of rental prices. What I am looking for is a way to estimate how many potential renters would be in the market for my rental. 

I need some advice on testing demand in a rental market before I make an investment in rehabilitating my family's rental properties. I have heard people say they placed ads for their potential rental to see how much interest they could generate. How does that work? How do you respond to inquiries? What other ways could I use to gauge demand? A local agent told me that most landlords in the area don't use property managers, so information is hard to come by.

This is the background: We own 7 rental properties in rural South Georgia: 4 small houses and 2 trailer pads. Our mother inherited the properties from her mother and put them into an LLC to pass on to my 4 siblings and me. Our mother has been the manager of the LLC and of the rental properties. She is closing in on 93 and finally admitted she needed help and was willing to make me her co-manager. I went down yesterday to assess the situation. Four properties have been rented well below what I believe is fair market rent. I knew it would be bad but holy crap! Three of the houses are empty. One is being repaired due to storm damage and needs some additional rehab. The other two need more extensive rehab but could be put in rentable condition. The trailers are not ours, just the pads. But, I'm going to have to evict two of the trailer tenants and I am pretty sure they will abandon the trailers. So, I potentially have two more rehab candidates. I can work out the potential return based on expected market rent but need some feel for housing demand for the type of rental property we have.