All Forum Posts by: Rob Cucugliello

Thanks @Chris Pelc,

I’ll message you directly. I am hoping that one integrated system can handle both functions. This would ideally include a video doorbell with an app that can manage both and see the cameras/recordings for both systems. 

Hey all,

I’ve recently acquired a 4 story, 5 unit building on a corner lot in old city Philadelphia. There is a very old door intercom and buzzer system that needs upgrading. I also wanted to add a few security cameras outside and in the common area. Does anyone have any recommendations on what to get? I can’t seem to find one company that does both. If that doesn’t exist, I’d love to get anyone’s input.

Much thanks, 

Hey @Michael Plaks! Thanks so much for your condescending response. While it provided little value, it did provide a good amount of entertainment for us. 

Trying to figure out a few things for a situation my girlfriend and I are in. It’s a great situation, but rather complicated and hoping for some guidance. 

We found an amazing 4 unit mixed use multi unit we want to live in. The "owners unit" occupies the 3rd and 4th floor and we would rent out the other three units, one of them being commercial. Since it's commercial on the first floor, we need a commercial mortgage. This means we need to buy under an LLC and not our personal. We'll also collect rent and pay expenses via our LLC and its new respective bank account(s).

Noteworthy, and Coincidentally, my gf will run her own business out of the owners unit we intend to live in. It will actually take up a sizable amount of the unit.

My question is, do we need to rent the owners unit from our own LLC? Do we sign a lease? Do we charge market rent? Or under? Or over market rent? Or do we just rent to her business and live there anyway?

Lastly, we own our current home. We will need to move out and do extensive repairs which will then end up being rented (a delayed brrrr in a way). So that will be vacant and having losses during rehab. Since that home is in my personal name, can I write off the losses as a “rental” which it’s intended to be but not quite yet? Do I need to do anything to ensure it’s possible to write it all off? I’ve never converted a primary to a rental before.

Anything else we should do, know, or consider? Again, we have so much to figure out, that any help and guidance is appreciated.

@Henry Clark - thank you for your input. I appreciate that approach. Unfortunately they are not all one lender. Got into REI almost by accident and did what you said - shopped for the best terms to make each property perform the best.

I did at one point try to consolidate, but any institution I found that didn’t sell mortgages had the worst terms: higher rates and typically ARMs, which I’m grateful for not taking because my rates would be crushing me now.

I’ll look into other versions of some of the things you mention like cross colatteral and construction loan but not sure how that would work considering I don’t actually have any construction needs. 

Looking for some advise on leveraging my equity  

I currently have 9 units across 7 properties which I acquired between 2013 and 2020, now totaling just under $1.9 million in value. With about $680k owed across them all, I have almost $1.2 million of that owed as equity, leaving me about $800k in available equity (assuming 80% LTV option).

What I’m hoping to do is to pull some of that equity out to buy more, but a cash out refi on any property puts it into the negative cash flow situation since my current rates are mostly 5.5% or lower. New rates are currently looking about 7%+

I asked one lender about 2nd mortgages, with the hope of pulling just the equity out, but the rates seem to be 5 full points above the standard, so about 12% so that doesn’t let many deals work. 

I can't seem to find anyone who does a rental HELOC.

I considered taking the negative one one and allowing another existing property profit “balance out” the cash flow, but that feels like a bad move and would be better to sell  

My ultimate goal is to build cash flow for FI, which I need more to do. Does anyone have any advice on the best way to pull out and leverage some of my equity? hoping this brilliant community can give me a little direction. 

Thank you! 

@Keven Vanegas - its in Gloucester county so not the same, but still south jersey. Town is on the river, close to Philly, South of Camden.  

The home is also on the main stretch, corner lot in a small town. minimal business there there but some. 

@Theresa Harris - hard to say in this market. Everything is inflated including list/sales price plus rents. Will rents hold at this rate? most say yes but who knows. It would likely take the same amount of time to sell and buy a new one than to flip what I have (sell and buy might end up being slightly faster) My vacancy holding costs aren't all that worrying if I have a plan to move forward and change that. I'm still gaining equity each monthly, half of which is being aid by the upstairs tenant. Not to mention the ongoing home price inflation... So could I turn it into something easier? probably but TBD on how long it would take and seems a little less of a guarantee? i dont know... that's the advice im looking for honestly.

@Mark Bosworth  Appreciate that input. That's kind of where my head is at as well. The main alternative I see is that taking the cash out and buying something else would essentially be transferring my cash into something else - as opposed to adding my own cash, out of pocket in order to turn it profitable. So I suppose there's potentially me turning my -$550/month into a positive for no additional cash... vs. a pretty sure thing of adding my own cash to change the -$550/month into a positive $1,500 or $2,500 per month...

Do you still choose to hold on and add your own cash out of pocket? Or take the $75k and buy a turn key to cash flow likely less that the above. I suppose selling and buying turn key(ish) could be considered infinite CoC return since Id just be transferring it? I don't know if that's the right way to look at it...

OK so I need some advice. 

In 2018 I bought a fully occupied mixed used building in South Jersey. A 2 bedroom apt upstairs and a day care was operating downstairs. Both occupied and was immediately cash flowing about $1k every month. Life was good. 

In June of 2019, the upstairs unit HWH burst and flooded the day care. Long story short insurance paid for the majority of the damages and even covered a bit of the day care vacancy, but the day care decided to not reopen. After some repairs it unfortunately it's still vacant (Dec 2021) and I have been losing about $550/month on the property.

I have been working on other investments so both my cash and my contractors have been tied up with other jobs. Although I am about to cash out refi one for those projects (a classic BRRRR) and will have a very small chunk of cash ready to use after I pay back some debt - approx $25k.

So I currently have 2 options from here:

1) The old day care could be converted into either a 4 bed 2 bath for about $50k which would bring in at least $2k/month in rent, -OR- 2 units each with 2 bed/1 bath for about $85k, bringing in $1,500/month each for $3k monthly total. I did the math and if you start 'now' then the rehab would be about a 50% cash on cash return. That doesn't include any initial cash investments or water damage rehab already complete. The double 2 bedroom unit would total be about 40% CoC return (again - starting now).  

2) However, I recently just so happen to receive a cash offer from another investor on the table for $200k. This would net me about $75k.

So the dilemma I have is, do I sell which gets me out of losing $550/month plus have $75k in hand, or do I "find" money to convert into either 1 or 2 units and start cash flowing again. 

My personal goal here is to build long term wealth. I currently own 7 properties/9 units - Including the above duplex in discussion. In todays market I don't have a lot of other immediate opportunities to reinvest the cash, but there's got to be something out there, right? Either way, I'm not sure the best move in my current situation. I feel like I wouldn't be able to turn the $75k from selling into a 50% CoC with another property in this market, but hard to tell. Also considering the $75k would be from a sale vs my own cash (or borrowed) does that change how I look at it? I haven't bought anything new since the pandemic. But is there something else I should be looking at? Some other calculation? I've been bouncing back and forth for a while now and need to let the buyer know.

Any input or advice is greatly appreciated - this feels pivotal in my goals and want to make sure I make the best decision.