All Forum Posts by: Matthew Drouin

I'm a huge advocate of Rochester and I would reach out to any of us to further expound upon the benefits of investing here.  But I wouldn't overlook the Albany area either like @Steve B. says.  Check out Troy, NY.  It's been getting better every year and there is a large PHD student and post doc pool of customers to draw from considering RPI in town.

@Charlene Isoh

- Reroof $8000

- Paint Throughout including kitchen cabinets $2000

- redo floors (as needed) $2000

- appliances $1200

- new fixtures throughout - $1000

- +10% for contingency $1420

$15620 very ball park.  The place looks to be in good shape and you could probably rent it as is if you wanted to slum it up but you probably want the best tenants that you can get.

@Charlene Isoh this all depends on the neighborhood as to whether that $1100 rent projection is accurate or not. Our city changes street by street and block by block so don't depend on a rentometer in Rochester to give you accurate market rents. If this property is located in North Winton Village then you can count on $1100 all day long. If the property is located in Beechwood, then your projections may be way off. It sounds like you are buying for cash flow so you may not be concerned with after rehab value but if you are concerned with valuation check the ARV against relevant comps and make your decision accordingly.

@Ebony Bolton I can suggest myself!  However I am very selective in taking on new investor clients.  PM me and we can get on a call and see if we may be a good fit.

@Jack Forrest there are several good property managers you can find on Bigger Pockets.  They have a reputation to build and also defend because they are putting themselves out there.  Not like some property managers who hide in the shadows and rob out of town investors blind.  Interview property managers and ask for several active references.  Also you may want to use a property management company that has a management portfolio located in and around the area you are interested in buying.  Speaking of which, what areas are you looking in?

Delegating snow removal down to tenants on multifamily property is too risky.  Besides, tenants rent apartments in my area (The Park Avenue neighborhood, which is a higher end area), because they don't want to deal with the responsibilities of maintaining a place.  My risk if you start delegating these responsibilities to MY tenants:

1.)  They start thinking of buying a home the next time their lease is up.  I would rather have my property manager pamper my tenants and keep them.  They think, "If I have to shovel snow and salt here, I might as well own my own place."  And they very well could.  Most of my tenants are very successful professionals with well paying jobs.

2.)  Having language in your lease which requires the tenant to do physical work on common areas can infer a type of employment status in the eyes of the insurance company and they could deny your claim if something happened depending upon the language of your insurance policy.

In conclusion: If it's a single family home that you are renting out, I have seen many landlords in Rochester, NY require the tenant to take care of lawn maintenance and snow removal.  And if I owned a single family rental, I would probably require them to do the same, BUT check your insurance policy and make sure this is kosher.  If its not, you could end up with your tenant owning your investment property very quickly.

Bottom Line:  Strike this language from your leases and contract out this responsibility to an insured snow removal contractor.  Have the contractor list you as additional insured on their COI (Certificate Of Insurance) so you are notified my mail if the contractor has a lapse in their coverage AND in the event of a claim, the contractors insurance will cover the claim; it wont subrogate to your insurance policy.  Since you will be modifying the lease, try to convince your tenants to pay 5 or 10 bucks a month extra each in exchange for providing this value added service.  You actually may end up making out on the deal economically (with the increase in rents), reducing your risk, increasing tenant retention.

@Sarah Karakaian maybe you can have your cake and eat it too.  Think about refinancing it as an owner occupied property and pulling as much cash out as possible or doing a home equity line of credit.  Fact, interest rates are low.  Take advantage of it and increase your return on equity.  Yours is abysmally low right now considering your large equity position.  Even if you break even in renting your place out in the short term with the new financing, your rents will appreciate over time as well as the underlying asset.  Good luck on your move!

I love NNN deals. It takes expense risk off of the landlord. However, I think it would go so much against what it customary in our Residential real estate market in Rochester, NY that I think prospective tenants would be confused on the language of the lease or intimidated and would be met with objection.

@Vernard Kennedy you can buy a portfolio of properties in Rochester, NY which have cap rates in the 16 to 20% range.  If you accumulate an aggregate net operating income in the $50k range and place a mortgage on it for 80%ltv, you will achieve your goal and cash flow in the $2500 a month range.  Do you have $60k-$70k to work with?

PM me if want to discuss ideas if you are considering Rochester.  I am an investor and broker here but I play in the lower cash flow properties.

@Thiru Subra yes you can invest.  I believe if you contract out the management you may not even have to file for a tax id number.  The management firm would pay all relevant taxes and keep you in compliance.

PM me if you would like to chat about Rochester.  I have owned and managed properties in my area for 11 years.  I would be happy to help.