All Forum Posts by: Joseph Walsh

I would rephrase it as "access to" 20k+.  For example, a heloc, a private lender, 401k loan (specifically during down times, but that is a different topic) etc.  AND a good credit score.  Simply put, the good credit score implies you have a handle on  your finances.  It also opens up access to things you otherwise wouldn't have, or have to pay a lot more for.  Sure, you might have some cc debt, but your not at 75% utilization.  You might have a car loan, but it's easy to cover...etc.

 I think you hit the nail on the head with that last statement before I cut the rest, know your market and understand the risks.  The point is, it sure seems like, based on the changes in that market over time, the risks now outweigh the rewards, unless the rents are extremely high.  And yes, they do have the right to whine a little when the local government unilaterally changes the market on people that have already done the risk/reward analysis bought in, and now the risk part of the equation has been changed on them as well.  (first screening laws were changed, then deposit rules, now eviction capability). They have created the forseeable misuse of bad actors....I am guessing this doesn't hold up to the legal challenges, but I am not an attorney.

What if the council decided, for the 3 cold months every year, businesses aren't allowed to charge customers in the city.  They MUST stay open though, and maintain their buildings, etc.  Or, city employees may not be paid those months, but still must do the work legally for 3 months before they can move to a new job?  "Well, you should of factored that in when you took the job, or opened that new business...bummer"

So...., credit score of 800+, 6 months rent on move in day.  THAT will help the issue of access.  Then the city bans that, and the landlords go, well, I can't afford to rent this out any more. I'll <30 day rentals only.  Then they ban that, and like has happened in other places that decide to "penalize" landlords for the "Greater good" (ahem, to buy votes) to an extreme, the landlords eventually just don't rent it out at all, then fail to maintain it, then bring down property values.  All the while the housing shortage is unaffected at best, or mad worse.

I'm sure some reading this will go, "well, he really got lucky".  What I see is he was active and working very hard at ALL the angles needed for success, and when opportunities presented, he was in a position to take advantage of them.  He knew his market, clearly had his contractors lined up and a good working relationship with them.  Had investigated local banks and financing options, figured out what kinds of tenants he wanted in order to self manage, had a mailer going, reached out to wholesalers, and was learning the RE industry from the sales side, plus I am sure many other details I didn't list.

Thanks for sharing.

Sounds like you need a new tenant when the lease expires.  Again, with all the previous mentioned disclaimers of "older, high location, etc."  I'd still give the 'ol, well, I am planning a walk through in x weeks/months.  I'll check the bulbs then if you if you haven't taken care of it by then. But yeah, if you have decent demand on the place, plan on replacing the tenant, or upping the rent next cycle at the least.

This seems like the perfect case for smart locks.  Not only can you give the contractor's temporary keys, you can connect remotely and lock if unlocked.  I bet you can even schedule some kind of "autolock" feature.  That said, I've never used them myself.  But the question was how to prevent a contractor leaving a door unlocked, might be a solution.  I bet some AirBnB veterans here would have some insight to their value.  And the fact that a contractor was there was a signal to someone to check the locks after they left.  It's sad, but the times we live in these days.

Ouch.  One question, did the $105k include a contingency?  If not, you were only over ~23-24% (@130k), which is a bit high, but not unreasonable and fairly close to the typical 20% contingency for all but the most experienced.  Of course, the rest spiraled and ended up much over.  Sorry for you expensive learning experience, but thanks for sharing with the rest of us so we might learn from it.

$600 to $800 is $200/month difference.  IF you were to raise that amount, it would only take 3 months to make up for a month of vacancy if they decided to leave, even two months would be made up in half a year.  assuming your numbers are right, and there is demand in your area, factor that in.  It's your business, and you get to decide what is more important to you, Higher total returns, or less short term operating hassle.

Yes.  I think you haven't realized you don't have to "defend" it at all.  If they are dismissive or contrary, just end it with "suit yourself" and move on.  However, some might be interested, or even an asset.  Sometimes you stumble into a "I have 3 rental properties" guy.  Specifically for me, we had a delivery a few months ago.  The delivery driver has six rentals, and I discovered is looking to move into a small multi-family. I go this name and number, maybe I have a future investor, or someone to learn from....

Also, assuming you have income somewhere else like w-2 income, those loses can offset some of that income.  So, it might not be a "loss", only on paper.  I have a property like that, I am waiting until my long term renter decides to vacate then going to spend the ~2k to get it ready for market and list.  Sounds like you just got that window of opportunity.  you can sell and no lose too much money, and look for a good investment, since it sounds like you paid too much relative to rental income  (mine is the same, but it was not bought as an investment, just my last house in a market that crashed so I couldn't sell without pain)