All Forum Posts by: John Teachout

When there's a fight and one of the parties moves out, then what? Assume that will happen and plan accordingly.

If the tags are expired or missing, call the police and let them know there's an abandoned vehicle in front of your property. They'll ride by and scope it out. They may put a flag on it indicating it's been checked and if it doesn't move, they'll have it towed. It's possible it was dropped there because it had to "move" from where it was parked previously... I had someone park a vehicle in the backyard lawn of one of my properties. Right behind the house. I called the police and they looked it over. It was gone a few days later. 

We don't provide washer/dryer in any of our SFR properties. We also don't provide a fridge. We do provide a range, dishwasher (if equipped) and either a range hood or over the range microwave. If there are laundry machines or a fridge in the property because it was left there by a previous occupant, we'll leave it with the understanding if it breaks it's not our problem. I'll hook up appliances if requested.

The current value of a property really only matters if it's being purchased or sold. Most of the people that walked away from their "upside down" loans on homes in the GFC would have been fine if they just kept paying the mortgage and held the property. There were a lot of adjustable rate mortgages back then, also a lot of loans that exceeded the retail value of the property. Due to a lot of changes in the mortgage/banking industry as a result of that mess, it's not likely there's going to be a repeat.

If I had a management company, I would want them to be selective in their tenant placement. I'd rather have vacancy of a unit awaiting a tenant than vacancy due to an eviction or torn up unit. If the manager places any warm body, the stats may look better but the results may be dismal.

Don't overimprove a property. You can make sure it looks nice by keeping the exterior in good order. The interior should be functional, safe and not so ugly people wouldn't want to live there. Often people try to do things to a rental that they would like in their own home and you can spend too much and it can become unprofitable.

Let's look at this through the eyes of the IRS agent auditing your return... You pay $50,000 for a truck to enable you to mow a lawn that would cost $50 per cutting. Based on the amount of times you cut per season the truck cost would pay for 35 years of cutting not even counting cost of fuel, plates and insurance which would also be deductible...

Was this your financial plan from the beginning? ie, credit card debt? This seems like a very risky method to complete a rehab and i wouldn't be thinking about future investing at this point until these cards are all paid down. And then don't do that again, lol.

As stated, find out if want you want to do is even possible. Then.... you need to find out if the split off lot would have any value. ie, is there new infill construction taking place in that area? Keep in mind that there are other issues to be addressed like sewer taps, utility access, water tap, etc.

Run the numbers and if it works, it works. 7% interest sounds crazy high but I've seen it more than twice that in the past. The rates are likely going to go higher yet and may remain high for several years. Assume that's the case and do your analysis based on that to see if the deal makes sense.