All Forum Posts by: Peter Mckernan

Use a licensed and bonded foundation company and keep the invoices, and disclose it to the buyer. If you do all that and their inspection on their purchase come out okay, you will not have a problem. Just make sure it is done correctly, and you will be good. 

If not fixed I have seen people sell for double what the work is because they need to take on the project once closed. 

I would say that 95% of PMs will not talk about adding value to properties are adding more to your bottomline/top line. These are people that are property managers not asset managers. Asset manager role would be to give advice on property that could be value added and increase the income on a property by small or big tweaks. It's like a syndication operator verse a money manager. These people are built to value add deals, you would have to look hard for these people in your market and probably pay them top end pricing to get your properties performing amazingly well! 

I would hire a trusted expert to get you real numbers, someone that does it in that area all the time (rents out properties/property management). 

With those numbers the refi is going to be good on the side of having some equity, the challenge like I mentioned is the Apprasier coming in and giving a number that may not support getting all your money out. I would think about having a local broker/agent give you a BPO on it and see what the number comes back in at..

Think this might be where Chris was going, but depending on your area and what sales look like in the end of the year months, usually sales are a lot slower, that might be a driving factor. If you can hold on till first part of January the showings and everything else should pickup.

This would be my action items: 1. hire a new agent that can sell the place, and get you numbers are rent and selling and sell the place. 2. be honest on the numbers you can get on an ARV so that you can sell it 3. start to get the conversation started with a couple lenders on what these numbers on refi would look like for you and this property 4. my suggestion would be to refi/rent before selling at a loss because if numbers work you can hold for a couple years then sell, but this is dependent on your cash position and liquidity of your situation.

Couple things... The numbers what did you buy it for? Will the HML allow you to refi? I would assume they will, but some do not like doing that?

Get in touch with a real estate agent locally, and see what you can actually rent it out for right now. Pull comps, if you rent it for 1500.00 you are cashflowing 120.00 a month with all the info you gave me and including fees except if you take any fees on (water/trash etc. I would not do this on you, pass along to the tenant). These numbers look good if you can get it to appraise for 170K that is the numbers I ran it at... You still have some meat left in the deal if you can get that price, and it would give you about $14,000 back. **I did not add a management fee in there, but if you do even at $1500.00 your top end you are barely getting by....**

This all depends on what the mortgage company will do on the Refi appraisal numbers, I would bring these items to meet that appraiser if you go for it.. List of all items remodeled and how much they cost and the comps in the area (some appraisers come from out of the area and you know best what the comps are and numbers are).

Other option: if the numbers turn to be tight and you cannot refi, I would think about selling it lower and taking less on the deal to get your hands washed from the project. The HML will get to a point if you cannot sell it and will take it back from you, and sell it themselves.. This is something you want to avoid. This might be the only option depending on what the rental numbers truly look like, I would get ahold of some lenders ASAP to see what this cost looks like!

This depends on the PM that you are speaking with when you reach out. Some people are growth-minded, which means they are willing to help for a low cost, or not much compensation knowing that the more conversations they have will lead to more clients. The other PM can be a fix-mindset type of person where they are not willing to share anything unless you have a property and are willing to sign a PM agreement in the same conversation. 

You should look for an "investor-friendly" PM company that knows how it is just dipping your toe into the water of buying a home/condo/townhome.. 

this sale I hope is all done after 2 months.. But my suggestion for future listings.

Look at days on market in the area that you are going to list. I would also look at like kind properties that are listed and active in that area too. This will give you one critical piece of information, that it may take X days to get an offer and sell, and the second item will give you what your competition is right now. For example, for this one, there are 5 4/2 in my area and they have close to the same condition as mine. This will show you that people have options to go out and pick another house over your place. 

Taking these two pieces of info will tell you how long you will take to get an offer, so if you go past that you should lower the price, and then the other action item would be to starting off lower than all the other properties if the condition is better than your condition. If you are the nicest 4/2 out there in the market and all the rest have not been remodeled in say 15 years, and your property was remodeled a month ago then the price on your property will be easily justified at a higher price on the listing side. 

The two things that will determine the listing when you go to list for your specific house, it is price and condition. If you are priced well and the condition is great barring there is not a ton of supply, then you will sell quickly!  

It sounds like you have a great system down, and I am sure that you can find some handymen that are in the area doing part-time work and then working at a day job that could be pushed into full-time work on your properties. That would be a move for you that I would look into. I would use a service like task rabbit or Thumbtack to see a handyman, get them out to the property and get them to do some work. Then you can see how they are getting their income on a conversation. The reason I say this is that I just hired a handyman off one of these sites, they did some great work for me and the guy is doing handyman work and working semi-full-time. He would love to go full-time handyman work if he got the right gig. 

I would look at people that are handyman over anything else, contractors will be used to getting more money and the amount you would pay them would either be too low, or the they would not conform to your work/company. The other challenge is that their work might not be up to par for what you are looking for as well. 

I agree with Greg, you could first talk to the contact you have been working with on this so far, see if they can change it.. If not ask to speak with a manager. And if not then just go get a public adjuster. Insurance companies want to fix it the cheapest way possible, and their goal is to minimize out-of-pocket expenses like this one.  Your job is to make sure they are covering what they need to cover for the property. 

I would agree with Drew, and I was just on a call with investors yesterday for a mastermind I am in. The guy who runs it lays it out like this..

1-5 rentals you are still doing okay, have more stuff come up between all rentals the closer you get to 5 or at 5. The 5-10 it gets heavier and a lot busier, and 10-15-20 it really is untenable to self-manage especially if this is not you main business like a person buying their own rentals and building it like a small business. 

A manager will roughly cost $100-$150 a month to take over a unit (it could be more or less in your market) and manage the units. So, if you have 10 units and you are going to pay $1,500 a month and you are working on an active income job, too, this is an easy switch due to the labor mentally and physically (even if it is just phone calls) to get these rentals running as a well-oiled machine.  

The time back will free up more time to increase your active income, or acquisition of more rentals to get you more cashflow (passively or actively). A PMC is great to use not only for all these items but also really being a trusted source for vendors too etc. 

Looks like two 2x4s put together. If it is that, then just replace the old one with a new one you should be good to go.