All Forum Posts by: Luke Jacob

@Matt Nico I have a tenant with two cats and they paid $250 non refundable pet deposit and $50/mo pet rent

@Chris Mason maybe 203k loans are just more popular in my area but my neighbors also bougt their historic row house with a 203k loan:  80k purchase price and 190k reno.

@Joe Prew I have been working on Brrrring my first property with this exact method. Didn’t seem to have any issues getting it under contract. It was a lot of extra paper work and the buyer was a crotchety old grump-but all went as planned, even had the buyer cover most of the closing costs. Granted, the property was on the market for quite a while, marked down every so often so maybe they were just sick of it, but I closed for 7.5k under their final asking price with them paying the maximum allowable in closing costs.

I even changed lenders two weeks before closing to save .5% interest and 1k closing costs. My realtor did say if I didn’t have such a good credit score it would have fallen apart.

As far as the GC goes I nailed that down prior to getting under contract and it was a friend of a friend sort of thing. He’s also interested in rentals in the future so I think he is using it for his own knowledge as well. I also aided in sourcing subs and any permits, paperwork, project management, etc. I think this is the biggest hurdle for contractors because they just want to work and manage their guys not deal with a bunch of bureaucratic bs. If you have any questions about the process let me know.

Does anyone know a good real estate attorney in Newport Ky?

I purchased what seemed like a duplex in the East Row Historic District of Newport, KY six months ago. It has separate water, gas, and electric meters and units. It has clearly switched back and forth between duplex and SFH over the years.

It is zoned R-2 for SFH and two families. However, I was told by the code enforcement officer that my lot is 400sf too small to be a legal duplex and wasn't licensed to be commercially rented as such for the last 10 years. Then he continued to tell me that an in law suite or mother/daughter set up with 2 full kitchens is perfectly legal, and I may rent the property as a SFH if I chose.

Fast forward to present day and he is trying to have me switch my electric service to one meter (when the current 2x100A is functional and up to county electric code). Which I believe should be grandfathered in like the rest of the properties code violations where I am not remodeling. Also, he called my GC about the intent of the property and claims that supposedly another resident called and complained that they weren’t allowed to make their house a duplex and rent a portion so why am I?

My biggest question here is how do I legally house hack to keep myself and renter protected. Can it only be done whilst I live in the property? Must it be a single room lease? Must it be a relative living there for ‘free’. (They also do not allow short term rental like Airbnb). This is my first property of any sort and I intended to start the Brrrr strategy with it. I’m extremely stressed and wondering if I should just cut ties and sell when the remodel is complete to find a simpler cut and dry investment.

Side note- they have already dropped the ball on me once approving vinyl windows and then making me tear them out and replace them with traditional wood windows. It seems they pick and choose when and what rules to enforce.

@Chris Morgan I also entered my project with the intent of using a lot of contractor's I know from Ohio. Although still possible they need a Newport Business License and must file though the city for that, and consequently you'll need to file for all your permits including plans, estimates, sketches, etc. Of course I have noticed a few contractors performing smaller jobs at night and on weekends under the radar, but during the week the code enforcement officer likes to cruise around and look for rule breakers. The contractors license is only about $40 but takes out the 'under the table' factor. Home owner permits range from $20-$1000ish, depending on the scope of work and total cost of renovations. None of it's really that big of a deal, just a lot more hoops than I expected to jump through...well except for the whole stamping my plans approved then making me replace brand new windows- I was pretty livid about that for a while.

@Storm Grimwood I have to agree that the biggest thing here is time/$. Ask yourself what your end goal is and let that guide you. Do you want to learn these skills for any particular reason or are you better off doing what you already do really well to earn capital and pay for contractors?

I am currently BRRRRing my first property and its wearing me out....I have spent my entire life around construction and can handle just about anything around the house inside and out but must sub out the technical stuff due to my 203k loan. That being said I have a full time job and a part time job, and then another full time job: project managing and working on the house(a 30 min commute from my current residence). What I constantly find myself thinking is ‘man if this was my full time job I’d be crushing it’. I have taken a week off work here and there and put in some long hours and that goes really well. My biggest frustration is all the 3-7 hour nights after an 8 hr workday: by the time I get in a groove I have to clean up. Anyways, I have found myself realizing for a lot of these tasks it actually makes sense for me to sub it out or at least pay more than I’d prefer for help, just because my time is so limited and I make pretty decent money at both my jobs. I will also tell you that when your not doing it full time you can likely take your estimated time and budget and double them, and then you should come out ok. On the ‘flip’ side it is incredibly rewarding and each project that gets finished gives me a great sense of accomplishment. Looking at the estimated arv and knowing exactly how to get there makes me feel like I can tackle anything.

I would weigh these things out and start with a small home that needs mostly cosmetic changes like paint, some cabinets, a small deck, a tile backsplash or something like that...enough to get a taste for what it’s like and after that decide if you want to step it up or scale it back. I can tell you I have learned that while having a full time job I will vastly decrease my direct sweat equity on my next BRRRRs, and if I eventually can quit my day job I wouldn’t mind rehabbing homes 50 hrs a week. Hope this helps and wasn’t just a rant! Lol

@Chris Morgan curious if you've pulled the trigger on anything yet? I'm currently working on my first home/investment property (brrr and house-hacking a ‘SFH' in the east row district of Newport). I know plenty of Covington locals and an investor there and the thing with Covington is the inconsistency and ‘hit and miss' nature of the neighborhoods. Ultimately my gf and I felt safer both physically and with a financial investment on the east side of Newport. Bellvue was also in the running but we happened to find the right house in Newport. Also, we see ourselves moving to Bellvue in a few years once we start thinking about kids, as it feels to us a tad quieter and more family friendly. Another option not previously mentioned is Ludlow, west of Covington. Although it seemed too sleepy and just barely starting it's ‘up and coming' journey back in Oct ‘18, I believe it's worth keeping an eye on in the near future.

Some things about my experience in Newport- the planning and zoning department/code enforcement is hit or miss when it comes to providing proper info and guidance. So far they've stamped my construction plans approved and then promptly stopped my window contractor as I was not within the constraints of the historic preservation office-which no one directed me to when I asked if i had any other stipulations to meet or paperwork to file.(They are literally in the same floor of the city building) So I have to replace 6 brand new custom oversized windows. Additionally, my house is physically set up as a duplex and has two mailing addresses, yet they are telling me my lot is 400sf too small for a multi family rental and hasn't been zoned as such for over 10 years. Thus it is currently labeled a ‘mother-daughter' setup or SFH with mother in law floor. Not really a major concern until I get tight on financing ny second or third deal and need to show rental income whilst living in the home. On the plus side I believe the ARV and expected cash flow will be well worth the headaches once I'm finished.

Hopefully this was helpful, let me know if you have any questions!