All Forum Posts by: Nathaniel K.

@Nicholas L. Sure do! House Hacking is the ideal situation, but in Los Angeles, CA (where I’m at) finding a property (whether a duplex or triplex) that will break even at most or have a minimum negative cashflow is very difficult. Unless I move about an hour or two away from where I’m currently at, it’s just not ideal.

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Quote from @Remington Lyman:

Quote from @Nathaniel K.:

Hello everyone,

I am looking rigorously to purchase my first investment property. I am leaning towards the direction of Section 8, due to low barrier to entry and guaranteed monthly payments. I understand the risks and things to look out for. My issue however comes at the fact that I am looking to purchase out of state. I live in Southern California and am looking to purchase in the Southeast Midwest states. What are some pointers, things to know, and tips for purchasing properties out of state? Is it a difficult process? Should I be concerned?

Your replies and insight is greatly appreciated!

Best, Nathan

I recommend you read this article on OOS investing. It explains the importance of creating your core four. You will need to get a local, rockstar Realtor, contractor, lender, and property manager.

https://www.biggerpockets.com/...

I invest locally in Columbus, Ohio

Thanks for sharing this article, going to take a read right now!

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@Sam McCormack Hi Sam, thanks for commenting. Ohio is certainly a state I am looking into. I have been looking into Akron, but am certainly open to other cities nearby. Would love to connect!

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Hello everyone,

Your replies and insight is greatly appreciated!

Best, Nathan

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Thank you all for your input. It sounds like it is best for me to purchase my first few investment properties under my personal name first then move thing over to an LLC once the portfolio progresses. My only concern with that would be the "do on sale clause" any suggestions on how to avoid this when it comes time to transfer things over to an LLC?

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Hi everyone,

My post for today is in regards to if it is better to get a loan with an LLC or personal name when purchasing my first investment property. I ask this question because ideally I would like to create an LLC and put all my investment properties (rentals) under that LLC, but I know that getting a loan under an LLC can be difficult among other factors like higher interest rates, especially like an individual in my case who is new to the game. In your experience should I forgo opening an LLC for the first few properties to save the hassle of obtaining a loan? or should I open an LLC from the get go? I look forward to hearing from you all.

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Quote from @Munya Chawa:

Hi all,

I'm a newer investor looking to potentially invest in long term rentals. I was initially hesitant about rentals because of covid when landlords suffered due to non paying tenants they couldnt evict....However, during a networking event, I spoke to someone who is a section 8 investor and the government "guaranteed rent" appeals to me greatly. I know there is a stigma associated with section8 tenants and destruction of your property etc....but I am still very interested in getting more info about this. I have a scenario/question that I'm hoping this platform can assist me with:

Is it better to get a single family home or a multi family property for section8?

If I were to get 100k 3/2 single home and rent it out on sec8 for 1500, with a mortgage payment of 1000...thus getting me 500 cashflow monthly. Or .....I get a triplex with each unit a 3/2......Will sec8 still pay 1500 per unit for the triplex thus bringing in 4500/monthly. If the house and the triplex are in the same area, are the 3 bedrooms considered the same when it comes to what the government will pay OR will they pay less for a multi unit 3 bed vs a single family 3 bed? If all 3 beds are considered equal regardless of the property type, then why arent people buying more multi properties and scale faster this way? In markets like Cleveland, I see you can get both a single family and a multi family for 100k .....is building my portfolio with multi units better for cashflow and scaling purposes?

Honestly, both seem like great options but here is where I become a little hesitant when it comes to multifamily for Section 8. Though great the biggest concern I would have is the fact that Section 8 tenants in multifamily may bud heads a lot and create lots of arguments and issues. Sure, this can be the case for any tenant but Section 8 tenants (especially those that aren't employed) will have tons of time on their hands and cause issues out of nowhere. Now of course this is an issue that can be solved by rigorous screening but you always run the chance of such issue. If you are new to the real estate game (like I am) I would start with a single family residence and learn your way around it first and then expand as you please OR you could also house hack with a multifamily. Live rent free in one of the units, rent out the other units to Section 8 and be the eyes of the property ensuring things are in order.

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Cleveland, Ohio

Quote from @David Leggett:

Lots of great info on here! I love learning about how the process works in different states. Cleveland, Ohio is an excellent market for Section 8 properties in your price range, but like many people were saying, you need to do as much you can as far as putting up guard rails and checks and balances with the tenants to make sure they're keeping up the property. But I've seen cash tenants ruin a property just the same, so I think if you do adequate screening and let the tenants know your expectations with the property, it should be a good experience. My advice is to find a property that is already rented out with a Section 8 tenant so that you can don't need to go through the 2-3 month onboarding process that's normal in this part of the country. I've also had several good experiences with EDEN and they seem to have a lot quicker move in times.

Thank you for your insights David. I notice that you are a Broker in Cleveland and would love to connect as that is a market that I am currently shopping in. Look forward to hearing from you.

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Quote from @Douglas Gratz:

Quote from @Nathaniel K.:

Quote from @Douglas Gratz:

Section 8 I great but you have to be in a landlord-friendly county/city. You want to be able to evict fast and have a new section 8 tenant lines up

Thats my number 1 rule with section 8 , but overall I think its great, improves during recession ( recession proof), won't ever go away (govt) , and direct deposits...I find if you treat them good they will treat you well but you need to know when to put the foot down

Thanks for your input Douglas. I certainly want to be in landlord friendly counties for this reason. Need the law on my side lol. It does seem that enforcement needs to be at an all time high but that doesn't seem to big of an issue. Do you know if S-8 covers the full cost of the Fair Market Rents? I heard that they do not always cover the full amount on the HUD website. Is this true?

It depends on the tenants incomes situation, some I get full and some they give me between 100-300

How about when it comes to utilities? I have heard that Utilities are included in the FMR, have heard that Section 8 provided an additional allowance on top of the FMR, and have even heard some landlord just pay the utilities.

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Quote from @Patrick Drury:

@Nathaniel K.
If you are buying Section 8 rentals out of state you are going to want a property manager. I would highly recommend against managing it remotely. The only residential properties I can see working for remote management are small multi-family/ single-family in A locations. Check the forums this topic has been brought up before it never works out for people trying to manage out-of-state remotely without a Property manager.

Hey Patrick, the goal is to certainly find a VERY GOOD property manager. Homework certainly needs to be done on my end to find an excellent property manager. Even then, however, I know a property manager won't care for the property to the extent I do so I guess I will turn into the property managers manager and ensure they are doing their job.

I see you are in the Cleveland area. Let's connect, Ohio is one of the states I am targeting for a Section 8 property. Talk to you soon,

Best,

Nathan

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All Forum Posts by: Nathaniel K.

Nathaniel K. has started 6 posts and replied 32 times.

Post: Purchasing Investment Property Out of State

Post: Purchasing Investment Property Out of State

Post: Purchasing Investment Property Out of State

Post: Purchasing Investment Property Out of State

Post: Loan under LLC vs. Personal Name to begin

Post: Loan under LLC vs. Personal Name to begin

Post: Multifamily vs single family section 8

Post: Insights on Section 8 as a landlord/Investor

Post: Insights on Section 8 as a landlord/Investor

Post: Insights on Section 8 as a landlord/Investor