All Forum Posts by: Jean T.

I recently moved out of Michigan to West Virginia. Given the market in the Metro Detroit area, I have chosen to rent out a 3/2 condo that I own. I've also handed things over to a property management company given that I'm out of state.

The property has been on the market for almost two months. For those who are landlords in Michigan, what has been your experiencing renting out property? How long has it normally taken to find a tenant, particularly for condos?

I'm wondering whether I should be pressing my PM more to get things moving faster. Any thoughts?

I owe a condo that is now going to be rented. I have gotten quotes from a couple of companies. I'm wondering how much coverage is adequate.

One quote I've gotten has dwelling at $6K, after talking to the agent. While I'm only responsible for the walls and in, that still seems small to me. Another agent recommended $80K (with at least $40K min). That seems too much. I don't think it will take that much to rebuild the inside in case of loss.

What about liability? I'm thinking $300K with $1M umbrella to include two other properties I own.

What are the thoughts of experienced landlords?

Thanks William.

I definitely must be looking in the wrong places, because I am not seeing those deals. I've been focused on the MLS so far, so maybe that's it.

I was out with my agent today looking at properties in Livonia and Farmington Hills. The cheapest one was about $75K, and it was terrible. It probably needed at least $20K of work.

What kind of rehab are you doing for these $35K properties?

That's a good thread. Thanks for the link.

I saw that Canton was mentioned as one of the "good" cities, and that is where this property is located. But I have to suspect that there are some lower priced homes there. Just gotta keep looking.

Maybe I haven't looked at enough properties, but in my area, the $60K properties usually need much more than a $5K rehab. Right now, I'm going through MLS, and maybe that's the problem. I know I have to use other ways to find property, and I plan to start doing that.

I'm looking to buy cash flowing properties. As everyone knows, we're not seeing much appreciation in Michigan, unless it's forced appreciation. So I have no intention of buying and not caring about cash flow.

Thanks for the advice. I guess I'll keep looking.

Thanks Jon. This very helpful.

According to the agent I'm working with, the bank MAY accept something around 90-95K. So we'll see. I haven't decided whether I'll put in an offer or not.

The 25% down is not something I'm in a position to do. I've already discussed that with my mortgage broker. So I guess I'll have to look for some alternative financing and see if it still works.

Thanks again.

I'm looking at a SF property. I want to get the community's thoughts on the analysis of this deal. Am I being too conservative, or is this just a bad deal?

Asking - $110K
ARV - $125K

Potential rent - ~$1300/month
Required cash flow - $200/month

Monthly expenses:
- Vacancy - $110 (1 month/year)
- Taxes - $250
- Insurance - $90
- Management - $130 (10% of rent)
- Maintenance - $130 (10% of rent)

Rehab - ~ $5K

Purchase costs - ~$9.5K (Closing costs, Finance costs, Holding costs, Management setup, Appraisal, Risk insurance, Inspection, Misc.)

Maximum purchase price = Rent - Required cash flow - Expenses - Rehab - Purchase costs = ~44K (assuming 7% interest)

With asking price being ~$110K, I don't see $44K being accepted as a top offer. Even if I use the 50% rule, I'm still at around $50K or so. Am I being too conservative here by including too many costs or are some costs too high? Or is this just not a good deal to even pursue?

Thanks a lot.

Thanks for your feedback Brian. Your point is well taken.

I have a pending dilemma that I'm hoping someone on BP can help me with.

I have a lease option buyer (married couple) who was due to exercise their option in a couple of months. Just got a call from them stating that one spouse has been laid-off, and they will be unable to exercise the option. And they won't be able to consistently pay the rent at the current rate. So they want to negotiate a lower payment.

Any ideas on how I should best approach this?

One option I'm thinking is that I can simply tell them no, and take back the home to find another buyer. Another option is to accept a small rent cut, renegotiate a longer option period, and put clear and harsher penalties for any missed or late payments.

Any thoughts?

Any investors in MI know of or have used a good CPA in metro Detroit?

I've been doing my own taxes for years now. I don't have many properties, but I'd like look at using a CPA this time.

And how do you do your taxes - yourself, CPA or tax-service company, like HR Block or something?

Thanks in advance.