All Forum Posts by: Kevin Seiler

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Lawrence.

Purchase price: $267,500
Cash invested: $65,000

This second aquisition is a duplex in Lawrence, KS. It is a new properting in a more desirable location than the 1st purchase. Both tenants are Section 8. I was a little concerned given some of the stories I have read about Section 8 but given the current economic conditions. Just to keep things interesting, there was a shooting at the property about a week after I purchased it. A current tenant kicked out an ex-boyfriend and he decided to shoot at the house, shattering a door wall.

What made you interested in investing in this type of deal?

Duplex in a solid neighborhood and a newer property. Also, it met my cash flow criteria.

How did you find this deal and how did you negotiate it?

It was brought to me by the realtor team that I have been working with in the area.

The seller owns multiple properties in the area and needs to sell properties due to financial and legal issues. Negotiation was through the realtor but the owner was difficult and not entirely forthcoming with information. Because of that, my first offer was about 20k below asking. Settled at $11.5k below asking. Appraised $10k above purchase price.

How did you finance this deal?

Conventional. 25% down. 30 year term.

How did you add value to the deal?

At this point, I haven't added any value, other than getting an appraise value of $10k above purchase price. The previous owner basically did nothing to the property. He didn't even provide decent management. I'm hoping that with my property management company, we can get the current tenants to take more pride in the property and report problems in a timely manner. Over time, we will address deficiencies, many which were minor, that were identified in the inspection.

What was the outcome?

So far, so good. The housing authority promptly paid the Section 8 portion of the rent the very first month we owned it. The tenants have paid their portion.

Lessons learned? Challenges?

The biggest challenge was the previous owner. He has no ethical moral character. He was lazy and thought selling the property "as-is" meant that he didn't have to do what he was contractually supposed to do. In the end, it worked out. I feel I got the property for a good price. If I had known how difficult he was going to be, I would have held out for a lower price. He has other properties on the market. I won't even consider them.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Tanya Kulaga and her team were on-point and amazing. They were prompt to answer calls and emails. Arranged times to meet my daughter (she lives in the area - this is an out of state investment for me) to view properties. Properties that were not as advertised - i.e. disgusting. Naked tenants and difficult owners. They took it all in stride.  I would recommend anyone looking to invest in the Lawrence, KS area to contact Tanya and her team.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Lawrence.

Purchase price: $267,500
Cash invested: $65,000

This second aquisition is a duplex in Lawrence, KS. It is a new properting in a more desirable location than the 1st purchase. Both tenants are Section 8. I was a little concerned given some of the stories I have read about but given the current economic conditions and impact from Covid-19. Just to keep things interesting, there was a shooting at the property about a week after I purchased it. One of the current tenants kicked out an ex-boyfriend and he decided to shoot at the house. The only casualty was a shattered doorwall. The ex was arrested and charged. Always something.

What made you interested in investing in this type of deal?

Duplex in a solid neighborhood and a newer property. Also, it met my cash flow criteria.

How did you find this deal and how did you negotiate it?

It was brought to me by the realtor team that I have been working with in the area.

The seller owns multiple properties in the area and needs to sell properties due to financial and legal issues. Negotiation was through the realtor but he was difficult and not entirely forthcoming with information. Because of that, my first offer was about 20k below asking. Settled at $11.5k below asking. Appraised $10 above purchase price.

How did you finance this deal?

Conventional. 25% down. 30 year term.

How did you add value to the deal?

At this point, I haven't added any value, other than getting an appraise value of $10k above purchase price. The previous owner was basically did nothing to the property. He didn't even provide decent management. I hoping that with my property management company, we can get the current tenants to take more pride in the property and report problems in a timely manner. Over time, we will address deficiencies, many which were minor, that were identified in the inspection.

What was the outcome?

So far, so good. The housing authority promptly paid the Section 8 portion of the rent the very first month we owned it. The tenants have paid their portion.

Lessons learned? Challenges?

The biggest challenge was the previous owner. He has no ethical moral character. He was lazy and thought selling the property "as-is" meant that he didn't have to do what he was contractually supposed to do. In the end, it worked out. I feel I got the property for a good price. If I had known how difficult he was going to be, I would have held out for a lower price. He has other properties on the market. I won't even consider them.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Tanya Kulaga and her team were on-point and amazing. They were prompt to answer calls and emails. Arranged times to meet my daughter (she lives in the area - this is an out of state investment for me) to view properties. Properties that were not as advertised - i.e. disgusting. Naked tenants and difficult owners. I would recommend anyone looking to invest in the Lawrence, KS area to contact Tanya and her team.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Lawrence.

Purchase price: $267,500
Cash invested: $65,000

This second aquisition is a duplex in Lawrence, KS. It is a new properting in a more desirable location than the 1st purchase. Both tenants are Section 8. I was a little concerned given some of the stories I have read about but given the current economic conditions and impact from Covid-19. Just to keep things interesting, there was a shooting at the property about a week after I purchased it. One of the current tenants kicked out an ex-boyfriend and he decided to shoot at the house. The only casualty was a shattered doorwall. The ex was arrested and charged. Always something.

What made you interested in investing in this type of deal?

Duplex in a solid neighborhood and a newer property. Also, it met my cash flow criteria.

How did you find this deal and how did you negotiate it?

It was brought to me by the realtor team that I have been working with in the area.

The seller owns multiple properties in the area and needs to sell properties due to financial and legal issues. Negotiation was through the realtor but he was difficult and not entirely forthcoming with information. Because of that, my first offer was about 20k below asking. Settled at $11.5k below asking. Appraised $10 above purchase price.

How did you finance this deal?

Conventional. 25% down. 30 year term.

How did you add value to the deal?

At this point, I haven't added any value, other than getting an appraise value of $10k above purchase price. The previous owner was basically did nothing to the property. He didn't even provide decent management. I hoping that with my property management company, we can get the current tenants to take more pride in the property and report problems in a timely manner. Over time, we will address deficiencies, many which were minor, that were identified in the inspection.

What was the outcome?

So far, so good. The housing authority promptly paid the Section 8 portion of the rent the very first month we owned it. The tenants have paid their portion.

Lessons learned? Challenges?

The biggest challenge was the previous owner. He has no ethical moral character. He was lazy and thought selling the property "as-is" meant that he didn't have to do what he was contractually supposed to do. In the end, it worked out. I feel I got the property for a good price. If I had known how difficult he was going to be, I would have held out for a lower price. He has other properties on the market. I won't even consider them.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Tanya Kulaga and her team were on-point and amazing. They were prompt to answer calls and emails. Arranged times to meet my daughter (she lives in the area - this is an out of state investment for me) to view properties. Properties that were not as advertised - i.e. disgusting. Naked tenants and difficult owners. I would recommend anyone looking to invest in the Lawrence, KS area to contact Tanya and her team.

Good Evening all!

Thanks for responding to my post.

@Daniel Reeder.  I will definitely keep you in mind for insurance if I purchase a property in the area.

@Bastian Kneuse.  If you could, I would love to connect with the investor group you know.  I would enjoy hearing about their experience in the area.

@Beau Miles.  Let me know how we can connect.  I would like to hear your thoughts about investing in the area!

@Michael S.  Thank you for your thoughts.  It is always good to hear opinions/perspective that may not align with others.  From the research I have done so far, it does appear that MFH is not as common as other markets.  They also appear to be on the smaller size - 1 bedroom or efficiencies.  I'm looking to purchase one where each unit has 3 bedrooms.  

As for the competitive aspect, I live in the Denver area and the competitiveness and cost is astronomical here.  What I have seen on the market in Huntsville is incredibly cheaper.

Since I was born in Huntsville, I have been wanting to visit the area for some time.  The mobile home park we lived in is probably long gone and developed over.  I believe my father worked at the Redstone Armory.   I actually came across my baptismal record the other night.  It the Church of the Visitation still exist?

@Jennifer S..  You are not the first person that recommended that my search should begin in the Redstone Arsenal area.

Again, thanks everyone for your replies.

Best regards,

Kevin

I was born in Huntsville but have not lived there since I was about 2 years old. In researching areas to purchase my next property, Huntsville came up a few times.  I am looking for recommendations for property managers and realtors to assist in my research.  I have always wanted to revisit my birth place and potentially investing in the area really intrigues me.

I am looking to purchase a duplex or larger.  I like properties to be near hospitals and universities/colleges.  I would also like to acquire properties that I can improve immediately or over time to increase value and rents.

Any recommendations would be greatly appreciated.

Kevin

Greetings all!  I purchased my first OOS rental property in Lawrence, KS last year.  The reasons I did so was because of affordability, it is a university town and my daughter lived there and could be my boots on the ground person.  My goal was to purchase a second property this year but the market has changed some and it may not be wise to invest in the area.  KU built additional student housing that has impacted the rental market.  The university is also experiencing a decline in enrollment.  Some nice properties have come on the market but the numbers, for me, just don't make it.  Many marginal properties are reducing their asking price in order to sell them.

So, I am beginning to research other cities that make sense to purchase my next property.  It was always my intention to limit my properties to two in the Lawrence area unless something phenomenal presented itself.  Anyway, I would like to hear what other OOS investors look for when moving into another market.

Thanks,

Kevin

Peter,

Thanks!  I am by no means an expert.  I made several mistakes in this first deal and now looking to make my next one.  I would be happy to share what little knowledge have in this area.  Let me know when you would like to talk.

My apologies for my delay in responding to your e-mail.  I've been fairly busy the last couple of months and unable to monitor this site like I would like.

Best regards,

Kevin

Matt M.

My daughter is in a masters/doctoral program at KU.  She isn't required to live in a dorm so she and her husband purchased a home when they moved there.  She has been a great help scoping out potential properties and meeting contractors/utility companies at the home.  There is also some sense of security knowing she can drive by and check on the property for me.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Lawrence.

Purchase price: $162,740
Cash invested: $42,083

This is a duplex.

What made you interested in investing in this type of deal?

My daughter recently moved to Lawrence to attend KU. The market is significantly cheaper than Denver and I was able to purchase a duplex at a reasonable price. Also, being that Lawrence is home to two universities, the rental market is fairly stable.

How did you find this deal and how did you negotiate it?

The realtor I was working with found it. It was a for sale by owner.

How did you finance this deal?

Standard 20% down - bank financed.

How did you add value to the deal?

I discovered some rental calculators on-line (not biggerpockets) and ran the numbers.

What was the outcome?

I was slow to get it rented because I chose the wrong manager. I fired her after two months and found one I'm fairly happy with and they got one unit rented within 30 days and the second within 60.

Lessons learned? Challenges?

The property was owned and lived in by a mother and daughter. So there was no income until renters were secured. The realtor I worked with also manages property - to provide management services in KS one has to be a licensed realtor. She did well with the sale but I had my reservations about property management.

Start up expenses have been more than I expected. The property had some issue to be addressed and I had to pay twice for the some work.