All Forum Posts by: John Vo

I don't know about Marshall & Swift, but I have looked at RS Means and did use National Repair & Remodeling Estimator to estimate repairs. Both of those were hit and miss depending on the projects. It would over estimate on some projects, which can lead to missing out on deals if it bring your bottom line cost up. So I only use those estimators as a conservative starting point, knowing that I can probably get the repair done cheaper. Hang out at your local Home Depot and talk to the folks who work in each department. They'll tell you how much labor cost for Home Depot is for installation and you can use that as your guide. Information from those folks is more realistic and applicable to the local area in my opinion than those national estimators.

To be clear I haven't list it yet. I'm looking to list it at $1300/month which is at the lower end of the price for the area. But even at the lower end of the price, I still see other properties hat have been listed, are sitting around for at least 30 days now.

Hi all. I'm looking to rent out a home and was doing some research on the HAR.com and it seems like there's an abundance of SFH for rent in Houston right now, specifically along the Energy Corridor as well as in Katy. Is this due to the fall season or is this an impact on the oil price and people are trying to just rent out their home instead of letting it go into foreclosure? Any pricing strategy for listing my rental? I'm looking at pricing a 3 bed/2 bath rental $1300 in 77084 zip code. It's at the lower end but I still see a lot of rental in the areas sitting for over 30 days now.

Robin Williams Natasha Keck Thanks for the great articles! Although the one from Business Insider seems to be a little bit over exaggerated and dramatic, but I agree with the general tone of the article that Houston is going into a decline in housing prices for anything above $250K. A property listed for $600K is anything but affordable, and there are demand for affordable housing regardless of what kind of housing bubble we're in. Properties less than $150K are still moving pretty well in good areas. In general, be conservative when you buy and keep in mind how the general economy might affect your strategy when it comes to financing terms. As someone told me earlier this year, you see the train coming, the train being Houston housing prices, does that make you stop buy? No take into account the incoming collision, drop in prices, and buy if it's a "good" deal. The key word is a "good" deal.

@Juan Cristales Thanks Juan. I'll PM you and we can talk. 

@Bryce Wong Good point. I'm not an experience rehabber so I estimate the wholesale deals using some rule of thumbs given to me by a GC in the area. 

@Shital Thakkar I think we're almost on the same page, the tax rate is what killing the deal from MLS for me. It's a 3% tax rate on a purchase price of $125,000, the assumption that insurance is about $1000 for just the basic policy, and the annual HOA fee of $450. So PITI and HOA fee is about $990/month. Add in the $300 a month for maintenance, vacancy, etc.. I'm right at about $1300 in operating expenses. That's if everything goes according to my assumption. Not a lot of cash flow or wiggle room for me if the market drop and rental price has to be lowered.

Of course, if I could buy the property from the MLS at around $110,000 then that's a different story. Unfortunately, the listing has multiple bids with low days on the market. Not a situation where I would even try to make an offer for $15K less than asking price unless it's an all cash offer...

@Shital Thakkar  and @Nick S. Shital if it's just PITI and HOA fee for a 30 year loan, then I would've cash flow about $250/month. But if I count in at a minimum the vacancy and maintenance/repair budget, like Nick mention, at a rate of 10% of income per year for each category per year, I would have a hard time cash flowing. I didn't even take into consideration my time as property manager.

In how I came about the vacancy rate, I took into consideration the growing apartments and SFH rental inventories in Houston. Just the other day, I saw a new apartment building that was just completed had an advertisement that say "Two Months Free", that's unheard of a year or two ago. In a hot market for rental, I would consider not applying the vacancy rate when buying, but we have a plethora of rental housing coming online soon or already have competing with each other in this market, so I'm trying to be conservative when buying.

Dennis Rodriguez Thanks but I don't need the luck. It has nothing to do with success in real estate if the numbers are right. I'll buy only when the numbers make sense, in the area that I'm the most knowledgeable about and if the deals doesn't fit my strategy and numbers I want, then I don't buy.

@Dennis Rodriguez Thanks, but I'm not interested in the Angleton area, little bit too far for me to self manage. I'll shoot you a PM and we can talk to see if you have any deals in the areas I'm looking at. 

@Dennis Rodriguez You're right. Neither of those property would give me cash flow. I would only be looking at price appreciation and equity accumulation through mortgage payment and that's not enough to get me to buy in this market so I didn't buy either. 

Still looking for a property that has the ability to cash flow along with some built in equity to combat against future decline in property prices, which according to HAR.com latest press release it's already happening. Apparently, that's hard to find in this market...