All Forum Posts by: Michael Pease

Good afternoon,

I wanted to reach out to the community and try and get some contacts for maintenance companies in the quad cities, Bettendorf, davenport, Moline, rock island, East Moline, silvis area. I've been through several companies lately and have not been impressed with quality, communication, or pricing. Does anyone have a good  ompany or individual that is looking for additional clients? I own and manage 28 units and am unable to do work purely on my own. Minor plumbing repairs, patching, lock changes, mostly just general maintenance. If able to do showings that would be a bonus but not a requirement as I can still handle those as they ccome up. Please help me out, thanks!

Michael

@Mark Holmes Welcome to BP! Great resource for new and seasoned investors. I'm also in the Bettendorf area so if you'd like to get together anytime and talk strategy or anything let me know! Always love talking to like minded investors. I'm at 28 units currently with intent of continuing to grow!

@Meghan Parsons - Nice to see other investors with properties in the Quad Cities. I noticed on your profile you were looking for a trusted accountant. I just wanted to mention that I'm not only a real estate investor but a licensed CPA with over 5 years of tax experience and various consulting projects for developments and historic tax credit deals all the way down to preparing very simple schedule E and partnership returns.

Are you having someone manage the rentals here in Bettendorf already or maybe looking for someone? If you have any questions I'd be happy to see if I could assist in any way.

I have had great luck with true duplexes in the quad cities. I currently have 5 duplexes that I own and manage and they have been my best investments so far in this area. The price range has varied between $80,000 and $140,000. I think trying to find something under $100,000 will be tough and as many have already mentioned, not in great areas as is the case with the one I purchased at that price point. It really comes down to the cash flow for me. I just recently purchased one for $120,000 that needed just a little bit of work and we have both sides rented out for $900 a month which generates great cash flow. It's a four bedroom per side duplex though which are really hard to find. That's the average price that I've found makes sense in this area. 

Welcome to the website @Taylor Larsen. I've found this site to be a great resource for local investors and also for more complicated transactions and some good tips on analysis and just about anything else you can think of. I've been investing in the Quad Cities for several years now and am also a CPA so am always happy to help and meet new investors in the marketplace.

Moving it into an LLC prior to the sale will not change the taxation. It will be a single member LLC and will still be contained within your personal tax return. You will pay ordinary income tax rates on the depreciation recapture and you will be allowed to take capital gain treatment on the gain not from depreciation recapture if there is any.

I would put the pro-rated rents into the purchase agreement and that way you can be sure that the amount on all the leases is pro-rated at closing and will go straight onto the HUD-1 and offset your funds at closing. I would think even if it is not explicitly stated on the purchase agreement that you should still be able to have the attorney's add the proration into the HUD at closing. That would leave the seller with having to collect the rents that are due for that month. I do the same thing with security deposits although am finding out that a lot of people collect those amounts outside of the closing. As an accountant it's easier to ensure that pro-rated rents and deposits are accounted for if they are directly on the HUD statement. Hope that helps Paul!

@Brian Campbell

@Matt Fisher

I tend to disagree with those figures. I have a duplex, probably in the area Trio would look, that was a $140,000 purchase that rents for $2,100. That generates very solid cashflow. Similarly, right across from that property I bought a house for $90,000 that rents for $1,400 and generates great cash as well including all expenses. If you're looking for more turnkey then $40,000 is probably not going to be something that you'd want to look at because it will need work most likely. @Trio Martinez, it really just depends on your situation and goals. If you want to live cheap/free for 3 years while you are at Palmer and sell when you leave there are tons of opportunities like that near Palmer. My experience with students there is they typically pay between 400 and 500 a room unless they have a unique situation.

This is how I got my start into real estate, buying a place when I was 20 and renting it to roommates and the other half of the duplex to other college students. Definitely a great way to build equity by having other people pay the mortgage and expenses as well as possibly generate some extra cash. As others have mentioned, there are other things to consider. A big factor for me in your situation would be what would I have to pay in rent vs. what would I pay if I purchased a house and rented it out. What would be the upfront costs of each, the operating costs of each, and the exit costs of each. As @Matt Holmer mentioned, the QC is big enough you can pretty much live anywhere. I personally prefer the Iowa side since the property taxes are lower and the re-sale always seems to be better.

If I could go back and do it all over again I would have repeated that process more times than I did. Buying a house, moving in, fixing it up, renting out rooms and then moving out and making it a rental and repeating with a new property. It's a great strategy if you are single and willing to move often.

@Rich BeamI'm also an investor in the QC area happy to pass along any knowledge or deals if interested.