All Forum Posts by: Nick Vehr

@Victoria L. So we have done something similar on our first house. We recently bought a house and paid cash out of our heloc with it. The reason I chose to do so was i was going to use the excess cash to rehab and then rent it out. I would then refinance 6 months down the road and pull cash out, repay the heloc and be left with a little bit of cash. 

Things went kind of crazy, plumbing disaster after plumbing disaster, we ended up going about 5k over budget because we didn't plan for drainage issues, plumbing. It just kept getting worse and worse, but we stayed on course. 

Found a tenant, went to move her in, she went a bit crazy made some weird demands, and we went different directions. I now have someone that I met through bigger pockets, placing a tenant and i will be handing it off to a property management company after so I will be completely hands-off. 

But, the house will still cashflow 180 a month, with a little money coming out on the refinance with a 75/25 30-year. At the end of the day, I learned more in the process than I ever would have researching, and I'm a big time researcher. 

My advice is, if you're going to use equity in your prime residence. You need to be sure you have multiple exit strategies, and a lot more cash than you think you need. Unless of course you have access to other funds. Run all your numbers assuming the worst will happen and be super picky on the deal. In the end if you can do those things it'll all work out. 

Good Luck!!

If the unit is a good deal and in a good rental area, then yard shouldn't matter. Assuming the tenant is going to be handling the upkeep of the yard, then it may just attract "different tenants" than a house with a big yard might. Regardless, it'll rent and provide income.

Jordan Grimstad I was think my id put away approx 15-16% a month just to cover me if something were to happen.

Hi all, Sorry i just posted this in the land lord forums and realized it should be here....

We have recently been sending out mailers and have had a couple of bites. The most interesting came yesterday and it was for a duplex in an area where I currently have a house. Owner tells me both sides rent for 900 and the owner pays water. She currently wants to get rid of it because she lives in a different state and managing it has become hard because her tenants seem unmanageable...no problem if we buy it, we will kick them out as they are on month to months.

Some questions I had is how do I proceed. I currently just own one property and its a SFH that rents for 900. I have the tenant pay ALL utilities, cut grass, maintain yard etc. My questions are what expenses should I account for other than grass and snow removal. I will say the numbers look "good" right now, but want to make sure im on the right page.

I feel like I'm missing something, owner wants 95k I will probably come in ~20% under whats being asked, and see what happens. Taxes, insurance, capex, property management, vacancies, grass, snow, water and mortgage have me coming in at ~366$ cashflow a month at the 95k asking price. I plan on putting each unit on its own water, and having the tenants pay that to unload some of the burden. By doing this it'll leave a little room to lower rent if I to attract a better tenant.

Anything im missing on this, much like my first deal, it all seems too good to be true, and i want to make sure im not missing something.

Thanks,

Nick

Hi all, 

We have recently been sending out mailers and have had a couple of bites. The most interesting came yesterday and it was for a duplex in an area where I currently have a house. Owner tells me both sides rent for 900 and the owner pays water. She currently wants to get rid of it because she lives in a different state and managing it has become hard because her tenants seem unmanageable...no problem if we buy it, we will kick them out as they are on month to months. 

Some questions I had is how do I proceed. I currently just own one property and its a SFH that rents for 900. I have the tenant pay ALL utilities, cut grass, maintain yard etc. My questions are what expenses should I account for other than grass and snow removal. I will say the numbers look "good" right now, but want to make sure im on the right page.

I feel like I'm missing something, owner wants 95k I will probably come in ~20% under whats being asked, and see what happens. Taxes, insurance, capex, property management, vacancies, grass, snow, water and mortgage have me coming in at ~366$ cashflow a month at the 95k asking price. I plan on putting each unit on its own water, and having the tenants pay that to unload some of the burden. By doing this it'll leave a little room to lower rent if I to attract a better tenant. 

Anything im missing on this, much like my first deal, it all seems too good to be true, and i want to make sure im not missing something. 

Thanks,

Nick

Ugh, every part of me wants to give it back except for my financial side. Ohh well live and learn, I've shifted to property management, and will focus on finding the deals. Landlording is just not for me.

Just wanted some insight on this. My tenenant became very needy, and began requesting weird things, (all new windows on house, deposit back, discount on first months rent) because the house was "Unlivable" with screen doors not offering security and old windows. Nothing was different from when she had seen it half a month ago. 

We accomodates somewhat, and painted a couple doors she thought were "unacceptable" and fixed a few other things, and bought screen doors. Then she demanded deposit back and we mutually agreed to terminate the lease. 

My question is should i keep the entire deposit, or only the portion related to items we fixed/doors we bought, as well as prorated rent for the first few days of the month. The security deposit portion of my lease is listed below. I dont want this to end up in a lawsuit i cant win. My lawyer has advised I should return only a portion based on what we had to do in repairs, in lieu of asking him again and paying ungodly rates, I wanted to see what this community thinks. 

My lawyer says since we mutually ended the contract, this line does not apply any more...

The full term of the Agreement has been completed and proper notice has been given.

My main question is, should i keep the deposit and move on, dealing with any issues that come up? Or, return the portion that is the difference in all repairs and requests we accomodated, as per the lawyers advice?

Thanks

Nick

Just wanted to give an update, if anyone here is still wondering..

We closed on wed, and hit the ground running. I got a dumpster delivered and had the carpet ripped up. My contractore picked up my flooring, counter top, sink etc. and got it all on site after tearing up carpet. The gas and electric were turned on, and we had a minor issue with the furnace pump, but got it fixed and the house heated up nicely. Next was the water, after being told it was turned on, we had no pressure and no water. So after getting them back there, turns out they didnt actually turn it on. Since the water had been off for around 1.5 years, we sprung all kinds of leaks, nothing terribly major, but we're working through the issues. 

Meanwhile, we started tearing off a roof to replace it, they are hoping to have it replaced by end of day tomorrow, so we aren't affected by weather. 

I have allure vinyl flooring going down all throughout the house once we get through the plumbing issues. 

Paint is coming in to paint EVERYTHING on monday, and I have a cleaning crew coming next friday. I hope to be able to show it on saturday and have it rented by Jan 1st. 

Been quite a ride, glad i just jumped in, because you cant account for everything, a lot of this is being able to think on your feet. Now, off to figure out what i need to do to get a lease with the things i want in it, and get it signed off by a lawyer.....

Thanks all, Getting contractors lined up and getting ready to move really quick on it. I will keep everyone posted where things are via this thread. 

@Kyle Burnett the house is in Colerain township, and part of northwest school district. 

Just got a verbal acceptance on a property I put in an offer on in an area in Cincinnati for my first buy and hold. 30k for a 3 BR, 1.5BA ranch on slab with 1 car garage. The property is going to take a bit of work to repair and get it rented out. budgeting ~15-18k for Roof, paint, flooring, landscape cleanup, new outlets and switches, a window repair and a couple other odds and ends. 

I will be buying this using a heloc against my primary residence, then financing out of it when repairs are complete (either via traditional, or another heloc). I'm estimating the after value 75-85k and it will rent out at 850-950, most getting 900 in the area, 

After refinancing, repairs, taxes, insurance, 10% capex, 10% vacancies, 10% property management (figuring for later in life, i will manage for now), I am predicting 255-255 cashflow depending on rent rate. 

Let's hope i didn't miss anything, but there's enough meat on the bone to absorb any beginner mistakes (I hope, lol). Either way, just thought i would share. Thanks