All Forum Posts by: Pete Harper

@Corie Carpentier

I think you are a little light on your expense estimate.

Vacancy 5-10%

Maintenance 5-10%

Property Manager 8-10%

Your $300/month is going to be eaten away pretty fast.

It’s a really tough market to cash flow in right now. Any opportunity to push rents higher? If it were me I’d like to see more than $2000/month on this deal.

@Conor Freeman

This makes a lot of sense. Last March I was having trouble finding lenders for a cash out refinance on a 4-plex in BCS. I ended up with a small regional bank willing to make a portfolio loan. Terms were 80%, 4.25%, 15yr.

Within the next year I plan to cash out refinance a 12 unit in a super small market. <17k people in the entire county. I put out feelers with the same small regional bank and they sounded interested. I’d like to find 30yr but if what you say is true it may be tough.

@Mitchell Brown

From your description I was able to find the listing on Zillow. Definitely looks like a flip. Property sold in 2/19 for $10,000; looked like a shack. It has been on the market for 89 days walking the price down from original $124,900. Listed for rent 8/19 for $1050 rented 11/19 for $800, vacant 4/19. Add the seller financing option and you have a very motivated seller.

I would not be afraid to low-ball offer at a price that works for you. Looking at finishes he likely spent around $70k on reno. That would put his break even cost around $90k. The worst thing is they will say no or counter offer. With it sitting on the market for over 90 days you don’t have a lot of competition.

Other things to consider with coastal properties; Hurricanes. What is the history of flooding in the area? Does it require FEMA flood insurance? That will double your insurance cost. FEMA saved me after a Hurricane hit our rental property in Surf Side. 5 ft of water in the downstairs was a mess.

@Eric James That only works if the property is appraised for more than you paid. In most cases the appraised value is much much lower than sales price. I never tell the county how much I paid for a property. You are under no legal obligation to report sales price in Texas.

In this case a more accurate assessment is to look at comparable properties. Are you assessed more per square foot than comparable properties in your neighborhood?

@Dan Maciejewski. That has been my experience too. Tenants are often the best source of information. I try to tag along on the property inspection. While waiting for the inspector to do his thing I chat with the tenant. “How do you like living here?” You will be amazed what people will share.

@Darald Berger I just hired O’Conner and associates to protest my taxes in Killeen. I tried to protest myself last year and lost. O’Conner charges 50% of the savings with no upfront fees. O’Conner came recommended from another BP thread.

@William Hughes I bet not a lot of people even know where Sulphur Springs is. Lol

I face a similar problem where I live. Just not a lot of investors in these small east Texas markets.

Here are a couple suggestions. You can set up Zillow searches based on zip code and property type. Zillow will give you daily updates if anything new is listed on MLS. I've purchased a 4-plex and duplex this way. Search on the county website for multifamily properties. In the advanced search use the multifamily property code and you can pull a list of every multifamily property in the county. I did this last year and sent yellow letters to all the listings ( less than 30, fewer if you account for owners with multiple properties). We purchased a 12 unit complex off-market last year.

Are there any REI meetups in South Dallas? We are about an hour and a half south of town on I45 but I'm willing to drive.

@Fernando M.

My property is a 4-plex with a common floorplan. I looked up all the recent sales and tax records for similar properties in the same neighborhood. I summarized in a letter and sent in to tax adjuster. I think I was dinged because of recent purchase.

I’ve taken similar approach on other properties and have almost always won. I hear bell county is tough.

This year I’m thinking of hiring O’Conner and associates to protest for me.

@John Morgan

That was going to be my follow up question. I was looking at using O’Conner. They sent me a packet and I was reading through the material this morning. Thanks