All Forum Posts by: Pam R.

Hi Brandon. I'll let one of the numbers experts address the financials of the deal, although at first blush it doesn't look unreasonable.

But I think you're asking for additional advice on the RISK of the investment, based upon your personal financials. If it was me - I would not do it. I would not stake all the equity in my home for this deal. You need a cash reserve. And $10k in rehab isn't exactly chump change for a small-time investor - especially if it represents most of your net worth.

You mention you are are paying off your debt - that is fantastic. You may not realize it, but you have already gotten started, but cutting your liabilities.

If it was me, I would build up my savings more. But then I'm personally not comfortable without a cushion. You don't give specifics of your debt repayment plan, and I'm not asking, but maybe if you've gotten it down enough, you can cut back on the pay-down and accelerate your savings instead.

There will always be another deal.

Best of luck.

Hi David. I feel for you. You could ask the City to pass an ordinance that cars have to be moved every 24 hours, many cities have that. Although that sounds painful and somewhat spiteful and could burn you as well as them.

Do you have off-street parking for your property? And I am unclear - are you living there and then renting out the 2nd unit? Or renting both units?

It may not be as big of a deal as you think. When I owned a house in the city, that type of thing annoyed me to no end. When I had RENTED in the same neighborhood - you just parked wherever you could find a spot, and didn't think anything of it.

Dustin - Try a search here on BP for Columbus bed bugs and you'll find an affordable referral for treatment. There was a columbus bedbug discussion very recently. I would not consider bed bugs a deal breaker - just a negotiation point.

I agree with the advice of @Tiger M. and @Chris Martin.

@Donald - waiting for them to die is not a good strategy.

Thanks all. Some very helpful insights here.

@Karen Margrave - Excellent questions. Central Ohio is the only area of the state growing. Delaware county has essentially become a bedroom community for Columbus. Columbus hosts multiple Fortune 500 and 1000 companies (Nationwide, Chase, Cardinal Health, Wendy's, AEP, to name a few). Lots of good jobs. Columbus also is home to Ohio State, with 50,000 students. Some number of those, like me, stay in the area after graduation. People move to nice, friendly Delaware county - and drive to Columbus for jobs. There are some great school districts, the nicest mall went in here. They just approved an outlet mall on the other side of the county, to start construction next year.

So the demand for high-end new builds is high. Median household income for the county (hold on to your hats) is $90k. I believe you have to make over $175k a year to be in the top 25% of wage earners in the county. (And this is a place where a 2/1 apt rents for $600/month - in a nice neighborhood) 95% of the people have high school diplomas, half have 4-year degrees. And the average commute is 25 minutes - which means they are driving to Columbus, just like me. I live at one of the furthest points in the county from Columbus, and I have a 30-minute commute to my job in Columbus.

You're right about the vacant lots. I'm staying away from that though. Developers already have several thousand lots available (there are 800 available near me, and I'm not in the "hot" part of the county)...they are just waiting for the real estate market to swing back into gear. I can't compete with that - and I need my real estate to generate an income right away.

@Bill Gulley - I agree with you 100%. I live in the country for many of the reasons you describe. What I have to figure out, with all the wealth in my county (which is also concentrated in the southern half of the county), is there a population of renters looking to move a little outside of that realm? Home ownership is 82% in the county. I like your advice - to focus on what gives each town its niche. I'm going to have to look a little beyond the most popular areas to get a good price point, and so I need to see what attracts the people who live there, and would potentially move there - while renting. Great advice. I think I need to figure out where the next migration of people in the county is going to happen.

@Richard Kotten - I think what I'm looking at isn't too dissimilar. Small towns with 20 minutes to a 25k person town, but then we have another 20 minutes to the 15th largest city in the country.

So far it sounds like small town rentals can be a positive. That's good info. I appreciate everyone's insights.

Sorry - that's "25k" people...no dollar sign. Not trying to put a price on Delaware county residents!

@Ryan Nelson - how small of a town? And do you find there is anything unique with the small-town rentals?

I have a property in Delaware, and that's about $25k people. It's both a college town and a bedroom community for Columbus, so it has both renters and buyers.

I should mention that the county I am looking in is the fastest-growing in the state, and is projected to grow another 50% or so in the next decade.

I'm in Central Ohio, and have been looking for a good investment property or two in Delaware OH for nearly a year. I've purchased one, looked at a few, bid on a couple of others. But good deals are getting harder to find.

Where I do see better deals are in very, very small towns in the area - probably 30-40 minutes from Columbus (so there are jobs in a reasonable distance) - but some of these towns have populations of around 2k people, or even less.

Does anyone have any advice/experience on rental properties within such small populations? Is it tragically difficult to find quality tenants? Are rents generally suppressed?

I know different geographies will have different circumstances, but advice on any hazards or pitfalls would be appreciated.

Mike - I sold my first home to a friend of mine without a realtor. I did pay a realtor a couple hundred bucks to perform a valuation of the property (but that was for my husband's sake - I actually made the deal to sell the house without actually telling him the house was for sale. Boy, was he surprised when I came home and told him we had 45 days to move! But that's another story).

Anywho, the realtor gave me the valuation of what he could sell it for, thereby affirming my sale price, then I hired an attorney to write up the documents, and the title agency took care of the rest. And this was several years before I had done any real estate investing - simply a case of selling my home. It was easy.

And yes, I'm still married. :)

I think he's saying 'it doesn't matter' b/c your insurance isn't going to pay any claim related to that dog. He's probably absolutely right.

Adam - I have no personal experience with vacation homes, but have a couple of friends who do.

One friend has a specific clause in the mortgage (from the bank) that she is not permitted to rent it because she purchased it as a 2nd home. What happens if she rents it and they find out? I have no idea.

A second friend has parents with a beach house. The laws are apparently pretty strict on how much "vacation" time the owners can spend there and still claim it as a rental. The last they mentioned it, the law was 2 weeks a year. I'll put it this way - when the son wanted to spend two weeks at the beach house one summer...he PAID for it. His parents had already used their 2 week allotment of time, so there were no freebies for him. What happens if they use it more than the 2 weeks? I don't know - but it's an IRS issue.

I would agree if that if you obtained owner financing, they probably wouldn't include the "no renting" clause.