All Forum Posts by: Ronald Starusnak

 John, here is a house a good friend of mine just sold. He had it listed for $27k, I went in for another friend of mine to give him an estimate for a rental remodel and I think we were under $22k total for the remodel for the roof, new paint, refinishing hardwood floors, upgrading kitchen, bathtub surrounds, vanity, debris removal, landscape work, etc. I have to be careful, I don't want to come across as self promoting. I can give you some broad help here but anything too specific I think should go to my inbox. 

Casey, I think it depends more on what kind of buy and hold you're looking for. Most of Syracuse is lower end and is excellent for multi-family or section 8 but there is also a massive college presence. If you can let me know a little more about what kind of investing you're looking for I can give you more information. It seems right now, at least in my experience that the section 8 and multi-families are giving a much higher ROI than the "nicer" areas.

Hey Carly, it's all in the contract. You can not do work that is not approved by the property owner, that's as simple as it gets. If a change order occurred wherein the job was going to cost more; that needs to go to the property owner for approval unless your contract with the property manager states they can approve jobs in such a way. We won't even add $50 worth of work to a $10,000 job when we're doing the work without written approval from the property owner. 

If I were in your shoes, I would get a better contract or review your current contract and see what is covered and what is not covered and require your property management company to require contracts for ALL work done to your property. I am pasting some sections from my contract that we use and provide our clients in NY for work to be completed. We are general contractors and property managers in the Syracuse, NY area.

Your property manager MUST require all contractors to sign a lien waiver as well, because in this case you could still get hit with a mechanics lien if you refuse to pay, and I would refuse to pay or attempt to mediate the amount. 

Specifications & Permits 

The project shall be completed according to any estimates, drawings, or specifications contained in this contract or delivered previously to “Owner” which have been examined by Owner and which may have been signed by both parties to this contract. Unless otherwise specifically stated or provided, Universal Property Management will obtain and pay for all required building permits and Owner will pay assessments and charges required by public bodies and utilities for financing or repairing the cost of sewers, storm drains, water service, and other utilities including charges for sewer and storm drain reimbursement, revolving funds, hookup, and other similar charges. 

Owner will locate and point out the property lines to Contractor, and will engage a licensed land surveyor to provide boundary stakes if Owner is in doubt as to property boundaries. Owner assumes all responsibility for the accuracy of the boundary markers. Owner shall give copies of any restrictions, easements, or rights of way to Contractor before work is commenced. Unless otherwise specified, work does not include any changes or alterations from the drawings or specifications that may be required by any public body, utility, or inspector. 

Contractor, at Contractor's option, may alter specifications only so as to comply with requirements of governmental agencies having jurisdiction over same. The cost of any alteration undertaken to comply with any such requirements shall be in addition to the Contract price specified herein.

Change Orders, Amendments, and Modifications 

Any subsequent amendment, modification, or Contract, which alters this Contract, and which is signed or initialed by Contractor and Owner, shall be deemed a part of this Contract and shall be controlling in case of conflict with any other provision in Contract.

Extra Work and Changes

If Owner, Construction Lender, or any public body or inspector directs any modification or addition to the work covered by this Contract, the charge for that extra work shall be determined in advance and the cost shall be added to the Contract price in addition to Contractor's usual fee for overhead and profit. Owner shall make payments for all extra work as that work progresses, concurrently with regularly scheduled payments. Contractor shall do no extra work without the prior written authorization of the Owner. 

Any authorization for extra work shall show the agreed terms and shall be approved and signed by both parties. Should any party, body, entity, or inspector require additional work to be completed or different materials to be used after this contract has been signed, it shall be considered extra work and Owner and Universal Property Management shall agree upon a price to complete per the specifications outlined by the former.

If you're buying houses under your name and flipping them under your name then no you don't need a license. If you are looking to buy under a business name then most likely, yes you will need a license. The laws vary by county however.

Look for a better deal with a better return. If you only have one property then your numbers definitely aren't going to look very good. You're not looking far enough ahead. If the numbers don't work, find a different property or picture down the line when you have a portfolio of 30 units generating passive income. You're not going to get rich off of one SF Rental. Where are you looking to invest? Syracuse has some incredibly cheap properties right now, I have a friend that has a few anywhere from under $20k to $1.5mil available. You can PM me and I'll give you his information if you're interested in exploring options in Syracuse. 

Any contract that has experience working with HomeHQ will charge you top dollar for the remodels. They're incredibly strict and require many redundancies that go above and beyond what is code. They do not offer down payments so your contractor will be required to come out of pocket on costs. They sometimes make an exception and will purchase materials for you based on what the contractor ordered, however. 

Their inspections must be passed or the contractor is charged $350 per inspection (at least for roofs). We did a roof for them and they had us install the roof in a way we've never seen, it was ridiculous and we lost $7,300 on the job. The customer wanted an in-expensive roof repair, they were lower income. Home Headquarters forced us to replace all plywood, install 30 year shingles, copper flashing, rebuild the chimney, etc. 

Incredibly difficult to work with HomeHQ. 

Look into something called Tax Loss Harvesting. Let's say he has 25 properties for sale for $2,500,000.00 and a tax rate of 15%. That's a $375,000 tax bill. If he is willing to sell an asset at a "loss", you can deduct the loss from tax bill. It just depends on his portfolio and the loss. He may have a property appraised at $300k but realistically might only be able to sell it for $100k. That's still a $200k loss he can deduct from his tax bill. 

Find a different insurance agent. If you allow dogs, then you should allow "Pitbulls". There is nothing wrong with a Pitbull, it's the owners you have to worry about. I've seen aggressive dogs of every breed. The other thing you can do is have him get his own insurance instead and add you as additionally insured and make him pay the bill.

Andrew, I might be interested. Please PM me. 

Guys! I couldn't make it, I went to the dentist this morning and ended up getting some work done and then I went home and fell asleep all day. How'd it go?