All Forum Posts by: Patrick Coffey

Hey all, 

Long time reader, first time poster. I have somewhat of a strange situation. I bought my 4-plex two years ago and when I did I inherited a tenant that was on a housing voucher, but not section 8 they say. Every month I would get a portion of the rent paid through the housing authority and they would pay the rest. They then applied for a change of income and stated they lost their job so now the housing authority pays 100% of the rent. My question is really 2 parts...

Since I inherited them I haven't increased the rent at all because I wasn't sure how it worked, and I still kind of don't. The housing authority that I get paid from is in a different county than mine (Worcestor county when they rent in Essex). Will that housing authority only pay the maximum fair market rent for their county, or would it be based off of my town? Because there is a difference of around $600 between those two places. And if I sent them an increase to rent form, would that mean that the tenant would be responsible for the other $600 or since the housing authority pays 100% then they would just start paying 100% of the new rent? 

Has anyone been in a situation like this before? I'd rather not lose the tenant if possible, because he's a decent guy and it's guaranteed 100% every month, but I also don't want to be leaving thousands of dollars on the table every year. 

Any help or suggestions would be greatly appreciated, and especially if you're in MA as I believe this is a state program as opposed to Section 8 which is federal. 

Thank you all for your feedback.

-Pat

I also purchased the rental book and managing books on audible but didn't get an access code. Can I please get a link @Michael S.? Thank you for your time.

I have seen the property a couple times. The water heaters and boilers are fairly new. One of the boilers is toward end of life but I have reserves for it. I will be including an inspection and lease review contingency in the offer.

@Steve Bracero

Thank you for the input. I'll go through and answer individually:

The attic -

I have gotten a few quotes and that's the highest number I've gotten. I could save some money if I do it myself and just outscource the jobs I do not have experience with (electrical basically).

The tenants -

All except for the $875 are under leases now until 2018. The small apartment is TAW which is necessary for me to be able to move in with primary residence contingency of mass housing loan.

The insurance was quoted by the company that is currently insuring the building. I don't know what the coverage of the policy is but I will add in some more to the numbers, thanks.

In regards to capex and repairs, the building is in great condition. I haven't had an inspection yet but all of the big ticket items have been replaced not too long ago. 

As far as property management goes, the building currently has a property management company that is charging 5% and has agreed to lower that slightly for a owner occupied. I am planning on doing that at least until I get into the house and speak with the tenants.

I am planning on paying myself a rent of at least 1250 (not $875, just investing it into my business so that's ok with me) too, as that is basically what I am paying now. That will help cover all of those costs as well and I won't feel the change.

Thank you very much for your input again and let me know what you think with added notes. Any more pointers are greatly appreciated. 

Hey all,

So I wanted to run this by people on here to let me know what you all think. I currently live in the greater Boston area and as you can see from the attached link the property prices are quite steep.

With that being said the rents on the units still make it viable. This deal is for a four unit multi-family. Using a Mass-housing loan I have to put 5% down with no PMI, and this would be my first purchase. I am thinking about going in offering 619k with 10k credit for closing costs. The numbers are attached (as a house-hack with me continuing to pay the $875 units rent, which is a huge savings to my current rent), but what isn't included is an attic conversion to add another 2 bedrooms and a large living room to the smallest unit(the one currently paying $875, which is the one I will be occupying. The end goal would be to finish the attic and rent out the unit I will be occupying for around $2K per month.

The report also has me paying for water for the whole building, although the seller has told me the units are paying their own water bills (which doesn't make any sense since they aren't seperately metered, but we still haven't seen the leases or spoke with the property management company, fingers crossed). 

Please let me know any thoughts you might have, especially if you're familiar with the area. I can confidently say that this is one of the only decent deals in a forty mile radius. I know the deal isn't golden, but I think it has a lot of potential for future growth and good cash flow. 

Please let me know what you think.

Thanks for your time everyone

17 Tracey St. rental property calculator report

Hey all,

So I am looking at purchasing my first rental property. Being from Mass, I have the ability to take a "FHA" type loan out, but with that I would need the loan in my name, and I would need to stay in the property for the first year. My question is as follows:

How can I take advantage of the tax benefits and asset protection of an LLC, while keeping the property under my personal name as I can't take the mortgage out as a business. Would it be possible to sub-lease this property to my LLC and have the tenants pay my LLC and use the business funds to pay for upgrades to the home? Or do I just hold it in my personal name until I can refinance and then get the traditional refi put to my LLC? Or is it possible to have a mortgage in my name while putting the deed in my LLC's name? I'm still learning the intricacies of how this works so any advice or even any idea who might be able to answer? (Lawyer, CPA, ETC?)

Please let me know.

Thanks all!!

Hey everyone,

I am just starting in this journey and am currently looking at 3/4 family houses in the Greater Boston area. I've been learning a lot from multiple different sources and would love to meet people around me and get linked up with some more experienced people. I am always looking for recommendations for my team, or new people who know more about this world than I do. Please feel free to drop me a line. 

Thanks all,

Pat