All Forum Posts by: Joseph Adelmann

Welcome to the community @Phil Long. You're well on your way to reaching your goals. I hope to hear more about your projects in the future. Best Regards,

Joe

Welcome Karen!

Its good to find others that are interested in real estate investment in Central PA. I have been bing listening my way through the BiggerPockets Podcats and could not recommend them enough. @Brandon Turner and @Joshua Dorkin do an amazing job getting people with all sorts of roles and niches in real estate on their podcasts to explain how they have achieved their successes. 

I am a member of the Berks county REIA and I would recommend joining it. They don't try to up sell you on anything and most meetings have a couple of speakers with occupations related to real estate. They had lawyers in to explain the PA blighted property act and have had contractors in to discuss the services they offer.

As for getting started, read as many articles as you can on this site. Where else can you draw upon the experiences of hundreds of thousand investors? And feel free to contact me with questions. I am getting starting renovating my first house hack 3 unit multifamily property so I can share my (limited) experiences so far. Good Luck!

Hey BP nation,

I am working on a deal on a 3 unit multi family property with a partner. The property is listed at $40K ( I'm in a more rural part of PA) fully rented and my partner will purchase the property with cash. Then he'll create a mortgage for me for half of the value of the home at the current mortgage rate for 30 years. The property nets about $7500 per year which will be split evenly and I'll be managing the property. I'll be netting around $200/ mo. 

The property was built around 1920 but is in good shape. All tenants are on month to month leases but one will be moving out soon. Another tenant is paying $100/ mo less than the other two units and they have a cat. And unless glade came out with cat piss scented plug ins, the tenants are not tidy with their pet. The owner hasn't had issues with any of the tenants paying though. 

Our next step is to have a home inspection completed on the property. This would be my first partnership on a real estate property. I'm drawing on the collective experiences of BP nation to find out what I should look out for? What are issues others have run into with partnerships? 

I don't like the idea of tenants with pets due to the added wear and tear (personally I love pets though) but I am not eager to face 2 turn overs starting on my second real estate deal.  What is the best way to handle this?

Thanks ahead of time!!

Joe

Welcome to the community @Anthony Atyeo. House hacking is a wonderful thing. I am just getting started hacking my multifamily primary residence. Best of luck and stay active on the site!

Hey Everyone,

There is a REI group in Berks county that meets on the first Tuesday of every month. Here is their website:

http://www.reiaberks.org/

I've been a member for a couple of months now and they do an awesome job of pulling in guest speakers offering services related to real estate investment.

There is also a Lehigh Valley investors club with more information at this link:

http://www.meetup.com/LehighValleyRealEstateInvest...

If anyone goes to this club please provide feedback. I haven't been and am curious about making the drive from Schuylkill county.

Hey @Account Closed

 Thanks for the feedback! That seems like a good approach to the problem. How often do you have to enforce that rule and is it easy to do?

Hey BPers,

How is everyone doing? I will be closing on a three unit house at the end of the month which does not have separate utility hookups for each unit. What is the best way to still have the tenants pay their share of the utilities? I was thinking about dividing the utility bills based on square footage. So if one unit is a quarter of the building's square footage, the tenant in that unit is responsible for a quarter of the total buidling utilities. Thanks for the help!

Joe Adelmann

Hey @Antonio Boone,

If $745 is the total of your mortgage, homeowner's insurance, and property tax, then I was overestimating your monthly expenses. If you were able to get $750 for each unit and assuming the same expenses I used in my first post then you'd be getting $380 each month.  Would tenants pay for all of the utilities?

It looks a lot better now and even if you could only rent them for $675 each per month, you'd be making $267 per month. My goals are the same as yours right now and I would be interested in this property if I were looking in that area.

Hey @Antonio Boone, 

When you say Monthly payments, is that your mortgage payment total? I assumed it was for what follows:

Whether this is a good deal or not depends on your goals. I broke this down assuming you rented both units for $750 and you'd be about even assuming 10% vacancy rate expense, 5% repair costs, and 10% for property management fees (may need it one day and if you don't use property management, this budget could go towards surprise expenses).

And, if you build up 20% of equity and refinance, your mortgage payment should drop by about $100 per month by shedding the mortgage insurance. I estimated the cap rate to be 13%, which is good. 

I've heard some of the speakers on the podcasts target $100 a door per month for cashflow, which this deal would have a hard time hitting at $750 of rent from both units. If @Kevin D. is right, about $750/ month being too high for that area, then you're making out worse on say $700 per month.

Good luck with what ever your decide though!

How is the real estate investing scene in Wilkes-barre?

Hey @Wayne V., thanks for the feedback. The leaky faucet is in the kitchen so are there any special tools for it? I would do the exterior painting but I am more hung up on how to remove the existing painting. I see recommended ways to remove lead based paint but not a consensus procedure. I'll have to try one of the methods and change if it doesn't work well.