All Forum Posts by: William Powell

I'd add the price of utilities to the rent. Take a high estimate of past utility performance and add it. In the future, I would look to install gas meters and electric meters. A few thousand dollars is worth the peace of mind you get from letting tenants pay their own bills.

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Allentown, Pennsylvania

I'm using a NEST Yale lock. It allows control from anywhere thru a Google and or NEST app. You freeze the pad and change codes. I like it.

https://store.google.com/produ...

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I quoted an investor for rodent removal and repairs for a rental house and it was around $5400. Needless to say, they didn't want to pay it because it sounds like it can be done cheaper but this is the only way I could say the problem is eliminated. The attic has squirrels and large raccoons living in the attic space. The cost broken down was the following work.

Tree cut down and limbs cut back from over house and haul off

Several tall shrubbery removed from against house and haul off

Broken gutters removed and new gutters installed for front of the house

Cornice package repair and paint several locations

Decking repair and new shingles in section

Rodent removal and feces removal

New insulation and removal of feces-embedded insulation

HVAC drain pain drain pipe modification

Note: I'm not sure what a handyman could do other than this to remediate the infestation but this is what I would have to do to stand by the work.

1 Vote

South Bend, Indiana

Yes a cash out refi is better than a HELOC to me in your situation. If you needed a credit line to make moves because you are doing this fulltime I could see it but a cash out seems better for your w2 lifestyle

1 Vote

San Antonio, Texas

Quote from @Kevin Sobilo:

@Vlad B., I agree with @Larry Turowski. You need to get a hold on managing what investments you have. I could understand 1 problem unit out of 8, but right now you have 3.

With 8 units your hard expenses should only be around 55-65% of what you bring in. Another 15% should be budgeted for maintenance, cap ex and vacancy and the rest is your profit. If you are a sinking ship like it sounds you aren't near that. Figure out what would need to change to get to this situation and then work backwards from that to see how you can make it happen? Refinance properties to stretch out payments? Boot tenants and do upgrades to boost rents? Simply raising rents? Adding features that justify raising rents like adding washers/dryers? Adding locked storage spaces at an extra cost? Adding fees for things like pets? Lots of ways to change your approach.

I've been tossing around the locked storage spots idea at my apartments for extra cash for about 6 months now. Good to hear someone has already thought of it and made it work. Thanks Kevin

1 Vote

Kansas City, Kansas

Quote from @Richard Rohrbough:

Quote from @Jeffrey McKee:

Quote from @Richard Rohrbough:

Hello BP friends. I need your help on what to do with my rental.

My monthly mortgage payment is greater than the rent I can get by $150 and the 2023 taxes are going up another $150/month.

I’m sure this is a common issue, so what are my options beyond the three I can think of below? Anything creative?

1. Ignore it/deal with it/subsidize it with other properties until someday rent catches up with my payment (meanwhile equity should have grown).

2. Make a large payment against the mortgage and ask the mortgage company to re-amortize the loan so that my monthly payment is less than what I can get for rent.

3. Sell the house (and make a better purchase on the next property).

A couple of questions first. How long have you owned the property? What was your reason for buying the property in the first place and what was your original exit strategy? Can you sell for a profit today? What city and state is the property in? Is the long-term appreciation worth eating the monthly cost of holding? Will it value your business to have this loss as a write-off? Are there better places for you to put your capital?

Good questions, Jeff. Thanks for sending them my way.

I bought the property a year ago (June 2022), rehabbed it over the summer and then tried to sell it in the fall. The market had dropped significantly such that I would have lost money on the house, so I decided to rent it out instead. Even at a loss each month, I felt it gave me a chance to someday get back to even or more whereas selling would be an immediate for sure loss!

My reason for purchasing was to fix & flip to gain cash, not cash-flow. After doing a few f&f properties and building up my cash, I then planned to shift to focusing on cash flow. So, I likely will continue with my plan of f&f to build up cash (plus keep this one property that isn't cash-flowing), but try to do a better job of buying right.

I can't sell for a profit today, but it would allow me to pay off the mortgage and have about $50k in cash to deploy again.

The property is in San Antonio. As for long-term appreciation, it's possible, maybe even probable. It's in a downtown neighborhood that is regentrifying, so I think there will continue to be interest in homes in this area which should help with appreciation over time.

There's some short-term benefit to writing this off, but there's probably a larger long-term benefit to keeping it if it appreciates and cashflows someday.

I don't have a specific property in mind that would be a better place for the cash, but I do believe that I've learned a lot over the last year and that I can use that education to make better purchases going forward. However, I don't have to sell this one property to make better decisions on the next property. I can keep this one property that isn't cash-flowing AND make better decisions on the next property. As my portfolio grows, I'll be less concerned about this one property AND I'll be giving the property a chance to get back to even or more.

It sounds like you are gonna be good over time. Every city seems to be revitalizing its downtown. San Anton, I'm sure no different. Slowly increase the rents at the end of leases and monitor your appreciation.

1 Vote

In this situation, I would just give it back minus any repairs I had to do. If they gave me plenty of notice and they were good paying tenants and they had an issue come up where they can't afford the place or job relocation and they asked to break the lease I will work with them. I'm not in business to be a miser and hold people to the letter of the law. I'm in business to help people who need a hand and I believe that God will reward me with much greater properties and deals. Treat people like you want to be treated. IMO

1 Vote

Cleveland, Ohio

At some point, you gotta handle business. You have to evict. Nowhere in the world can you live for free. You know that and they know that. They are taking advantage of your kindness. This makes me so angry to see tenants take advantage of a good soul.

Send them a letter tomorrow that says you have 5 days to pay all rent owed or leave the property in broom-swept condition and turn over the keys. Meanwhile, go to the courthouse and file a forceable entry detainer and have them served. When they contact you and they will tell them they can stop this procedure by paying all rent plus legal fees. When it goes to court you will win because they are not paying you. The judge will grant you the property and give them 10-14 days to vacate. If they still refuse to pay rent or leave they are deadbeats looking for a free ride. Call your process server and have their belonging placed on the street. Not legal advice just what I would do

1 Vote

Milwaukee, Wisconsin

These are what I call good problems. It's easier to get one good deal than two. However, if you are buying just for appreciation in a good market like Nashville and you got the income to handle any rough times that can show up I'd grab two properties and let the magic happen. In a few or more years you're back making this decision again but this time with $520k. Great job by the way and good luck.

1 Vote

Nashville, Tennessee

When you add taxes and insurance you will probably be more in the $920. I'm curious will you have equity in the property at 110K? If not it's a terrible deal for you.

I spoke to another guy about this game, sometimes seasoned investors will offer deals like this to newbies setting them up for failure. Notice the seller is still getting rent but doesn't have to carry insurance and property taxes. Plus the seller is getting a nonrefundable down payment. Lastly as soon as you start to struggle because you not making money, the seller will call the loan due and take back the property. I think you can do better.

I'd negotiate for better terms if you want this property.

110K purchase, 22K dp, 30 yr fixed, 6% interest, $665 payment. Then you could cashflow a few hundred dollars and this would make more sense. I'd still like to see you get this property under market value by at least 10 grand. Hope I helped

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All Forum Posts by: William Powell

William Powell has started 5 posts and replied 119 times.

Post: Multifamily - utilities not separated

Post: Locks for out of state Landlords

Post: What do I do with my Rental!!??

Post: Investment Strategy Advice

Post: What Can I do in 2023 to Keep Investing

Post: Monthly mortgage is greater than rent - What to do?

Post: Returning security deposit - tenant ended lease early

Post: Tenant months behind on rent

Post: With current high interest rates, should I put $260K into one 3/2 rental, or two?

Post: would you take this deal?