All Forum Posts by: John Powell

@Mike D'Arrigo, I definitely am. I take it there usually is a due on sale contingency? I saw that others transfer the property with a quick claim deed etc? I'm still reading up on it. The topic is confusing to me. 

I've been on bigger-pockets from time to time to time and  I'm wondering about running numbers.....

I was looking at a home in the KC area and I'm wondering about what I should or should not include.

I'm calculating an older property that's been completely renovated, and upfront I plan to have $5,000 in reserves just in case. So,

I calculate annual repairs at 10% or the square footage of the property.

I calculate cap-ex at 10% percent without running all the numbers on fixes. This amounts to about a grand a year.

Average Vacancy, after running a high/middle/low number and averaging, is at 10%.

I've also included property mgt, taxes, and insurance after receiving a quote. There is no HOA.

Are there any other numbers I'm not considering? It's not possible to include all disastrous events, however, are there other routine expenses I should look for? IS there a more effective way to estimate cap-ex? I'm just using a percentage to cover costs down the road. Also, what do people think of 40 year loans to increase cash flow? 

Any information is appreciated! Thanks!

@Jason Bott,

thank you, that gives me some ideas. I'll keep digging.

@Laura Williams thank you, you have a strong knowledge base. I will send you a message.

Hi, I'm wondering about the process for placing a SFR into an LLC or series LLC, or is it recommended to just keep sole proper-ship? I have a goal or purchasing SFR's only to invest in. Generally what is required? Any information is appreciated. Thanks you!

@Laura Williams, thank you for your input. Gutter cleaning makes sense. I Suppose I should talk with a lawyer regarding LLC's. That sounds like a fairly simple process regarding LLC's. Do you separate each home and property with each LLC? I'm gathering that umbrella insurance for outside protection, landlord insurance, and flood insurance are necessary.

I've been looking around for inspectors. Most say they require at lease a week notice or more to inspect a property due to how many properties are bought. I've looked at one company that lists properties at a fairly low price that has gotten great recommendations. The whole doing things from a distance is what's a little iffy to me. Would you have any recommendations as far as companies or inspectors? Areas that were recommended on here include past the 435 loop, in Raytown, past 23rd of Independence, Grand Prairie, and areas further out in the suburbs. I couldn't necessarily find listings for homes further out for turnkey companies.

What insurance types and levels would you all recommend for the Kansas City area? When renting an SFR out? Any input is appreciated.

@Keira Ingram, @Christopher Webb, and @Laura Williams,

thank you all for the information and insight. I was wondering how other people handle these things simply because maintenance issues can creep up quick if a home is not watched. I rented out my primary home for a 1.5 years when I went to Nashville. In my experience, the tenant usually does not keep up on things like changing filters. The property management company I had at the time did a poor job contacting us back regarding maintenance issues. Which, can make or break monthly returns. Whole preventative Bi-Yearly checks seem like a great idea. 

Gutters getting clogged seems to be a maintenance issue in Kansas City? What other home issues are specific to the area? After I spoke to a few home inspectors, they stated older plumbing (clay pipes), radon, and chimneys are unique to the area and are important to inspect. 

I've read briefly on LLC's. I read that it's fairly difficult to place a home into an LLC. Would anyone recommend placing a home into one of these business entities to protect themselves?

@Account Closed, I've looked in Tucson, but what's the best way to find any deal on a SFH? It seems like the inventory is over priced and returns are bad. I checked out a 4 bed 2 bath 1200 square foot HUD home in the east side of Tucson that would probably rent between 900-1100 dollars. The home itself is selling for list 88,000. It looks like there is a room addition that looks bad with insulation leaking. Updating would be at least 10 grand. Just guessing. It needs an AC and duct work. I've seen a couple of foreclosures like this that have an extra room that has not been inspected. I'm assuming that it would require a tear down.

I'm not sure if this is the best area to post these questions, but they've been on my mind. I'm curious about home maintenance from a distance. I'm still very interested in the turnkey in the Kansas City Market, but I'm trying to get my ducks in a row. How are the homes typically treated for termites in the area? I've found that in Arizona, the older homes from the 1950's were treated with DDT and termite treatment isn't always necessary. Is it common for rehabbed homes or turnkey providers to treat these homes with some kind of treatment, such as Termidor, or leave the home because the treatment is effective from the past?

Also, in regards to changing filters, would it be best to pay a property management team to replace these every 3 months with one of those ace hardware filters or require another service?

What are peoples views on A/C tune ups over the winter and heater inspections during the winter once a year? I typically have mine inspected at least once a year.

Also, last but not least, should I be concerned with flushing a water heater once a year and having lint traps cleaned by property mangers? I usually don't do this.

All of this may seem excessive, but I'm curious to how owners/investors treat these maintenance items from a distance or close by.

Thanks for all the input in regards to schools and violence. Saves me a lot of time and it gives me something to look into. Gordon,  I'm not sure about seller financing? I'm assuming you need to own the property outright to do seller financing. I heard this is an effective way to sell a property and get it returned if someone defaults on their loan?