All Forum Posts by: Marshall Leipprandt

@Barrett Bridgewater My current properties are actually not in FEMA designated flood zones, but I elect to have flood insurance simply for peace of mind.

@Dan Slaughter That is insane! I think @Barrett Bridgewater might have an answer to that question as I have not done it before for my properties. I'm guessing your jump up is the combined increase in cost between your homeowners and flood policies? We've got a fairly large rental property whose flood policy is $1K and the homeowners is just under $7K. Even our "smaller" rental is $1K flood and $6K homeowners, but neither are in FEMA flood zones, we just choose to pay the additional $ for the peace of mind.

@Roger Brown Get on the phone with an experienced VA lender to discuss. From how you describe the situation, I would say no. You could use your VA loan to buy the house, but if the parcel is an empty lot and is entirely separate from the lot which the home is on, then you wouldn't be able to purchase it using your VA loan.

@Sang Yi Your title says "Advise on my VA assumable loans", but you make no mention of anything related to that in your post.

What you're asking is if you're allowed to work with multiple real estate agents, which the answer to that is yes assuming you don't sign any buyer representation agreements. However, I would suggest you do some research to find one experienced and investor-friendly agent that will work hard for you when you need their services, especially if you plan to purchase sight unseen. 

However, there is more at play here. Have you been pre-approved? Do you understand the buying process? You make it sound like you'll just be shotgunning offers out, but your agent will want to know what you're looking for so that they can keep your best interests in mind when speaking with the listing agent. 

@David Martin Why not try to do both? Look for a property that can be used as an STR but also has a space that you can live in. I've been looking for these same types of properties for my wife and myself.

Some options includes small multifamily properties (2-4 units), homes with a mother-in-law suite, separate guesthouse, casita, or even a space that can be converted into a small apartment like a garage since STR guests probably don't need garage parking anyway.

This is the best of both worlds as you're taking advantage of the higher rental rates of an STR but also able to lower your living expense. Additionally, you'll be able to maintain the property and even do the cleanings yourself if you chose to. Realistically, these types of properties are rare so you may have to be creative in your search. Filter by keywords to try and get some matches and tweak your search criteria from there for best results.

@Sinead MacFhionnlaoich What is their current rent? If they're asking for a $450 net reduction off of $1,500/month, then absolutely not. If they're asking for $450 off of $5,000/month then even that's almost a 10% reduction. 

At some point you have to go with your gut, but if your property is in an area with strong rental growth and demand, you also have the option to tell your current tenants no and re-rent it at current market rents if your tenants decide to leave. The reality is that everyones costs are going up, not just for tenants. As a landlord, you no doubt have higher property taxes, higher insurance, etc., so I don't believe it would be wise for you to reduce rent $200/mo because the only person benefiting in that situation is your tenants. I understand you have empathy for your tenants, and that is admirable, but at the end of the day you are still operating a business and you have to look out for yourself as well. Finding that balance can be hard!

@Eric Goodman You can do it without a property manager if you invest some time on the front end to set some systems up and make good connections. Being in Suprise, you shouldn't have any issues finding the components you need to run a successful STR. In that area, the main things you'll need are as follows:

-Professional Cleaning Company: automatically syncs w/ your calendars, have experience and have been around for years, quality cleaning. If you have an experienced cleaning company, your interaction with them for turnovers should be relatively minimal.

-Handyman/Contractor: for when guests break doors, appliances go out, and everything else that happens in a home. Someone who can get there within 24 hours is ideal.

-HVAC on Speed Dial: you NEED this. Don't want AC out on an August day and have guests asking you for refunds. When this happens, you lose 2x as much since you not only have to refund if you choose, but also have to pay for repairs. Have the AC folks come out twice a year to service your equipment.

-Landscaper/Gardner: Even with a zero-scaped yard, someone coming by every couple weeks to clean things up gives the home better curb appeal when guests arrive. 

I've self-managed some STRs from 2,000 miles away for 18 months and counting. It is doable as long as you're able to visit the property 2-3 times per year at a minimum to get eyes on.

Some other helpful suggestions. Get keypad doors so guests can check themselves in, use IGMS or similar service to automate messages and sync calendars across Airbnb and VRBO. You'll come to realize that if you put in the time and create the systems, you can say goodbye to Vacasa and get your property up to peak performance.

@Aditya Kohli From your description of yourself and your partner's situation, I would rent it out despite the negative cashflow and try to look to purchase another property. In my opinion, there is a rare exception for when negative cashflow is permissible and it sounds like your situation fits the bill. For this exception, there must be a dual income household in stable, well-paying industries or a large amount of savings to weather a loss of income from losing a job or having the house vacant, etc.

When the -$800 and the +$500 which nets -$300 is a drop in your proverbial bucket, I would continue ahead to purchase real estate. The other thing you need to look at is how this rental property would impact your net worth bottom line. So you net a negative cashflow, well what is the monthly principal pay-down on that mortgage? What might your average appreciation be over the next 15 years given a conservative appreciation estimate? How does this property affect your tax position in terms of depreciation, etc?

You need to make a wholistic decision on how holding this property as a rental will impact your bottom line net worth. If you are financially responsible and don't have a personal cash flow problem, you shouldn't have an issue having negative cash flow on one property. BUT, if a lack of liquidity could be a concern for a future house-hack, then I would also recommend you create a 2 year personal cash flow forecast where you add up all of the $ coming in and the $ going out on a monthly basis to try and get an idea of where you'd be.

@Braeden Cobb The worst you can do is fail, but you'd still learn a lot in the process and be better off in the end for it. At your age, you've got the time and the motivation and you'll find opportunity regardless if you are pursuing this in good faith, with open eyes, and an ear for constructive feedback.

A lot of times with startup businesses, you'll realize where or what the true need is after you launch your product or service. I don't think an entrepreneur exists that hasn't pivoted in some way from their original business idea. I think that to be successful, you'll have to be hyper-focused on a region or niche where you can prove that your model is successful for reasons X, Y, and Z. Don't try to conquer the entire industry at once, but take small bites out to see where the appetite for your service is.

@Bryce Kennebeck With eXp Realty, you are allowed 3 personal transactions per year where you do not have to pay any commission split to the broker. You'd only be responsible for a small set of standard fees which are unavoidable (and of course your closing fees/costs since it's a deal for yourself). I'm sure other brokerages have similar policies, just a matter of either researching them online or calling around.

For your first deal representing yourself, I would recommend finding an experienced and savvy agent within whichever brokerage you're working with and asking them if they would help you as a co-agent with your first transaction for a split of your commission. Maybe offer to give them 20% of your commission, but try to do everything yourself before asking them for help. Have them QA your documents, contracts, etc. and walk you through whatever little nuances arise during escrow.

@Brian Dotzler Best to talk to a CPA or tax professional for your specific scenario. Based on what you've said, my guess would be no unless you were ONLY using the truck for business purposes.