All Forum Posts by: Kevin Meyer

I recently was notified my tenants are not renewing their lease to a rental property I own. I would love to make it my primary residence and would love to hear other thoughts on my pros/cons list.

Pros:

I have about 50% equity in the property right now, so I could refinance and pull some equity out and maintain a primary mortgage interest rate. (current interest rate is 3%).

Avoid paying some capital gains tax if I live there for the next two years and decide to sell.

My girlfriend and I could get out of my parent's house and have a place to call our own/finally get a dog.

Still house-hack by renting out 1 of the 3 bedrooms. 

1 mile from the beach, in a beach area.

Cons:

No more living rent free at parent's house.

No more $600+ cashflow from the rental. (It will actually take about $600 out of my pocket even with renting out a room).

Can't refinance without getting a rental property mortgage rate.

Would rely on a 1031 exchange to avoid paying tax in the event of selling. 

What are some of your thoughts when looking at the aforementioned? Thanks in advance. 

Question:

I live in CA (LA county) and am currently renting. My current 9-month lease ends September 30. I bought a multi-family unit and close Aug 6. Tenants are coming in place with that property, and have lived there longer than a year. I used the VA loan and must occupy the property as my primary residence within 60 days of closing (Oct 6th). I plan to give them a “no fault, just cause” notice, giving them 60 days to leave the property. This overlaps with my lease by a week after expiration. I talked to my landlord and she said I could have a 4 month extension (through Jan 31) or opt to leave Sep 30. Her logic is trying to find a tenant during the holiday season can be harder.

What are my options to proceed?

Do I rent an AirBnb for a week? Or do I have rights as a tenant? Thanks.

Does anyone have CA landlord forms, specficially a lease, in Spanish? My future tenants speak a little English, but their native language is Spanish. I would like to provide them with a Spanish and English version of the same rental lease, so they fully understand what they are signing. Thank you. 

I'm going to bring this thread back to life in 2021. Interesting to read the comments from 6 years ago. Now that we are closer the 2024, what are the indicators that people believe a recession is coming?

Hi Caroline. Thanks for the response. 

To provide more context: My offer of $850k was accepted and we are in escrow now. Still need to do the appraisal and inspection, which is where you see most of the issues coming due to the lack of legal permits and not being up to code. Let me know if you have more to add knowing this information. Thank you! 

Hello I am getting into real estate investing. I am looking to use my VA loan on a "duplex" in Hawthorne, CA (near Space-x). Asking $895k, and I planned on offering $850k. The "duplex" is 3 bed 2 bath, but the master bedrooms to both units are walled off creating two 2 bed 1 bath units and two 1 bed 1 bath units (no kitchen in these. essentially a hotel room). There is room in the backyard to add an 600sqft ADU (which I plan to do and get permitted by the city). As the property stands now, the 3 car garage was converted into an illegal 1 bed 1 bath ADU (not permitted by the city).

Using the VA loan would allow me to put no money down (no PMI and at an 850K purchase price at 2.75% interest rate). I estimate the mortgage to be around $4400-$4500. Currently, all the rent money would be enough to cover the mortgage, however not covering all the costs like water, gas etc. I have about $130k in a brokerage account that I can use towards building the permitted ADU in the back, but this would essentially drain all my cash reserves.

Tenants come in place. They pay on time and have been there for years despite being on month to month lease terms. Breakdown of their rent is as follows: 2b1b-$1350; 2b1b-$1275; 1b1b-$600; 1b1b-$500; 1b1b garage unit-$950. Total rent collected is $4675. Expenses are water-$150, Sewer-$300, Gas-$40, Trash-$92. Total expense is $582.

After adding the ADU and making it a legal triplex, I would eventually want to turn the garage back into a 3 car garage, so I don't get in trouble with the city. The triplex in the area are going for between $950k-$1.2M.

I'm looking for advice from a seasoned and experienced REI. Does this seem like a good value add deal and house hack? Or is there too much risk involved? Thanks in advance.