All Forum Posts by: Michael S.

When I buy a mid to low end home the cabinets are replaced only as a last resort.  The usual course is to paint the cabinets a glossy white and add brushed nickel knobs and replace a few small pieces of hardware so that they close properly and look alright.  The reason for this is the older cabinets tend to be made out of real wood while the newer low priced cabinets tend to hold up poorly.  

In the rare event that I have to replace cabinets I go with the best deal on Craigslist or at a local ReStore.

The above was a $300 Craigslist deal for the cabinets and counter top.

Below is a more recent budget renovation on another "gross" house.

There are a few more kitchen remodels that turned out better, but gloss white and brushed nickel knobs tends to be the most cost effective.

I hope this helps.

I'm uncertain of the real estate law in North Dakota, but I find the contract terms to be offensive. (The exception to this would be if the buyer’s agent is able to find incredible deals). Always remember that as the buyer you have much more at risk than the buyer’s agent, because of this you should be completing a good amount of due diligence and participate in actively searching for the properties you will eventually make an offer on. The process will help with learning about real estate.

I would look for a different agent to assist you.

If you were is the Phoenix area I would be willing to search for homes for you and offer a rebate.

Good luck!

I would allow the service dog/pet and the normal deposit and normal rent.  An ADA violation could turn out to be much more expensive than the damage a pet could contribute.  If you are concerned with damages exceeding the deposit when the tenant moves out, you always retain the right to get a judgement/pursue the tenant for the cost of the additional damages.

If everything else checks out with the tenant except the service animal, I would allow it.

I hope this helps.

To clarify: The time I attempted to view the property and speak to the occupant was during the 10 day inspection period while the home was under contract.  I'm uncertain of the contractual inspection period for New York.

My advice would be: if you cannot inspect the home prior to purchase then adjust your offer to compensate for a full interior renovation - flooring, plumbing, paint, many fixtures, etc. 

I have both bought from Hubzu and walked away from deals on Hubzu.  One Hubzu home I purchased was vacant so it made the inspection easy.  The other was occupied and I revised the offer (which was cancelled).  

Regarding the occupied home I could not inspect, I attempted to simply speak with the current occupant and have a civil meeting to see if they would be moving out or would be vindictive and destroy the home.  I had also prepared to offer the occupant cash after moving out rather than have to go through the eviction process to create a sort of win-win, rather than a loose-loose (where the angry occupant is forced out and destroys the house along the way).  The occupant would not answer the door or respond to a letter, so I revised my Hubzu offer for worst case scenario.  The revised offer was not acceptable to Hubzu and the contract was cancelled.  

My advice would be: if you cannot inspect the home prior to purchase then adjust your offer to compensate for a full interior renovation - flooring, plumbing, paint, many fixtures, etc. 

Of special note:

I'm not sure if it is still like this but the Hubzu preferred title/escrow company was really bad.  It was outsourced to a company in California that in turn outsourced to a foreign country. The Hubzu title company created a few errors along the way.  One of the errors I did not find until a  year after the sale.  I found out that my tax bill was being sent to an incorrect address.

Good luck

Thank you for sharing. You have learned many great lessons.  Here are my comments on a few: 

#4 Holds true for selling and renting.  When I would have  a vacancy in November and December in the past I would start to wonder what was wrong with my rental, why there was half as much interest than the last time I rented it, if the area was getting worse, etc. But it turns out it is just a more difficult time of year to rent or sell.  To prevent this in the future I try to sign up November & December renters to modified lease, such as a 13 or 14 month lease.

#5 Finding specialists is key.  In the beginning I tried to do most of the renovations myself, coming home sun burned and covered in dirt each day.  Eventually I started to hire out repairs so I could get back to working on my home business.  I found that the specialist could often work 4 times as fast as me due to their skill and specialized equipment.  For example a painter may charge $20 hr but complete the equivalent of 4 hours of work if I did it myself. So doing the work myself I was providing myself with a job that paid $5 per hour ($20/4hrs). I had to recognize that if I worked 40 hrs per week at $5hr for a year then I would only be saving $10,400 and missing out on generating income from my other businesses.

I find that time helps to make up for renovation blunders/over expenses when you buy and hold rentals with positive cash flow. Over the course of a few years I collect rents and appreciation (in a good market), this tends to always make up for any unforeseen expenses I had during the initial purchase.  With a flip you loose the cushion of rent and appreciation.  The network of repair people and investor skill required for a flip always seems to be much greater than required for a buy and hold and eventual sale.

Good luck   

I'm an investor/ buyer in Phoenix and the east valley. I'm always interested in wholesales deals if the ROI makes sense.

Thanks

Hi Juan,

It's ok, but I think you can do better in the valley. The mortgage plus the HOA plus random expenses would make it cash flow negative or break even each year. The Phoenix area is a hybrid market providing rental income and appreciation. The appreciation has been great the past few years but I consider it a bonus and consider the rental income a better indicator of whether to buy or not.

Personally I focus on SFR Single Family Residence. It is easier to find tenants for the SFRs and you will receive a premium for the yard and privacy vs a town house or condo. The SFRs also seem to appreciate at a better rate, while condos tend to be the last to appreciate and the first to decline in a bad market. I try to buy 4 homes a year in the valley. In this market you need to be fast with your offer (24 hours of a deal coming to market) or very slow. :) What I mean by very slow is making low offers on homes that have been on the market for awhile.

Good luck.

Keep talking to lenders.  1-4 mortgages is the norm but it is not the rule. I spoke with more than 20 mortgage brokers and banks over a course of a year before I found a national lender that could provide 10 mortgages.  The rates after mortgages 1-4 are about 1%-1.5% higher for mortgage 5-10.    After 10 mortgages I am told the rate goes up another 1%-2% but I have yet to get that far (on #8).