All Forum Posts by: John S.

If Government takes away our income (stops our tenants from working, prohibits evictions), but not our expenses (doesn't freeze our mortgage interest & payments) - what's the difference?

I would rather banks fail than the people...but the Banks won't. Banks have insurance and get paid regardless if the loan goes into default(insurance pays) or not (mortgagee pays). Landlords do not (at least I don't).

Why are landlords expected to take the squeeze and not the banks??

Seeing some cold-hearted, business only decisions from my fellow landlord colleagues in other threads. I understand both sides.

Interestingly, our courthouse has closed for 30 days (for now - I'm betting it will be longer). There will be no evictions possible (for now).

If a tenant has to make a choice to pay rent or save their money for the unknown, I'm guessing they will make the same cold-hearted, business only decision and not pay. After all, we landlords have no recourse with the courts closed.

I'm hoping the government will bail out the people this time and not the Banks. Forgiving others and my mortgages will do much better for the economy than bailing out the banks who will get insurance payments regardless if we pay the mortgages or not. e.g. 2008-12-ish . I'll be following this discussion to see if you guys hear of anything that assist us landlords.  I myself am anticipating 100% non-payment on my rentals.

More food for thought: Looking into past pandemics such as the 1886 Small Pox, it wasn't the first wave (the one we are currently in) that was the largest problem....it was the second wave that crushes the medical systems. People go out after quarantine, thinking the virus went away. I wouldn't expect to go back to normal life until a vaccine is available (typically take around a year I hear).

All in all, this is yet another example that this economic system was good while it lasted, but it's time that we evolve or the pitchforks are coming. :)

Seeing some cold-hearted, business only decisions from my fellow landlord colleagues.  I understand both sides.

Interestingly, our courthouse has closed for 30 days (for now - I'm betting it will be longer).  There will be no evictions possible (for now).

If a tenant has to make a choice to pay rent or save their money for the unknown, I'm guessing they will make the same cold-hearted, business only decision and not pay.  After all, we landlords have no recourse with the courts closed.

I'm hoping the government will bail out the people this time and not the Banks.  Forgiving others and my mortgages will do much better for the economy than bailing out the banks who will get insurance payments regardless if we pay the mortgages or not. e.g. 2008-12-ish

More food for thought:  Looking into past pandemics such as the 1886 Small Pox, it wasn't the first wave (the one we are currently in) that was the largest problem....it was the second wave that crushes the medical systems.  People go out after quarantine, thinking the virus went away.  I wouldn't expect to go back to normal life until a vaccine is available (typically take around a year I hear).

All in all, this is yet another example that this economic system was good while it lasted, but it's time that we evolve or the pitchforks are coming.  :)

Anyone know of any assistance programs for landlords?  I have a feeling all my tenants may not be able to pay with the quarantine.  Let's bail out the people instead of the banks this time...

Great insight, thank you for your input!

I'd like to hear other opinions on this...I'm debating if I should cash in on my 3 flat in downtown Wheaton, IL.   Any thoughts out there? 

In March 2018 I completed a three year battle with the City of Wheaton (this use to be a 4-flat with code violations from prior owners).  Now that I've cleared up the violations, I'm wondering if I should cash in and pay off the renovation debt and buy another place.

My architect is recommending me to convert it back to a single family home which will increase the property value significantly (due to comps... there are no rental comps in the area, just sfh comps).  I'm thinking of doing this conversion myself with hard money.  So here are the options I'm wanting your input on...

1. Keep as a 3 flat rental and pay off the debt slow over 10 years, but have a good / steady rental income after that.

2. Sell as is and pay off the debt now, but no good / steady rental income after that (could buy another).

3. Obtain hard money of $250k, convert back to a single family luxury home, and sell for a potential 71% Cash-on-Cash Return.

4. Something else I have not thought of??

Here are my numbers that I was going to add to my Zillow Listing (the potential investor would pay me the $450k purchase price), hopefully this makes sense to you...

Best Case Cash On Cash Return: Convert Back To Single Family Home

$450 purchase price + 250k conversation for a $700k Total Investment

Sell $1.2 million (architect's estimate)

500k Net Annual Income

500k/700k = 71% Cash On Cash Return

Current Case Cash On Cash Return: Continue As A 3 Flat Rental

$450 Purchase Price

25% down is $112,500

Annual Net Income is $12k

12k/112.5k= 10.69% Cash On Cash Return

(could be 13 to 14 % if you raise rents to market value)

Here is the actual property:  400 S. Hale St. Wheaton, IL 60187

Thanks in advance for your input!

John

Hi Sarunas, Did you find any yet? I'm interested in hearing what you've come across...

I unfortunately had to evict a tenant who is friends with one of our City building inspectors… Now I'm being dragged into court for code violations on my apartment building. Anyone have a referral of a fair attorney with code violation experience? Thanks for your help!

Thanks. I'm trying to pass your info to her (her name is Cathy I) but your contact info doesn't show and I'm not sure if the forum rules for posting within the forums. Thoughts?

Thanks everyone, I just passed the info to my colleague!