All Forum Posts by: Amber Gonion

My husband started out house-hacking in 1999 on a duplex, he added more properties and had a few properties that were just above $100/door after reserves etc, but they quickly were either rehabbed or gained higher rents within a year or two.  While not having adequate cash flow is a concern as Bruce pointed out. We look at properties in a two year window when purchasing.  Often rehabs or turning over tenants takes time and after two years we can stabilize.  Let's not forget  if you have a duplex worth 350k your principle being paid each month averages about $450-$500/month without any forced appreciation for house-hackers.  And it only grows as you hold the property.  We look at properties as long term investments if it is a good property, we don't mind less cash flow in the first two years as long as the long term play is solid.  

@Danilo Ojeda Our rental rates are $75/mo and 1/2month rent for filling vacancies for our investors that purchase with us or sign a contract to purchase in the future. We recommend investors factor 9% of rent for management costs.

We offer it as a perk for our investors so we offer it at a low rate. Depending on the rent at your place it sounds like they are cheaper, if they do a good job I would not hesitate to continue with your management. If they are good they can save you thousands of dollars, if they are bad and do not know what they are doing they can cost you thousands.

If you don’t have a lot of units sometimes it is best to manage yourself, often owners have the time to do so, sometimes they find it is too much or they make costly management mistakes and decide the fees are worth it. Managements goal is to provide experience and perks such as cheaper maintenance costs, trusted vendors, etc to offset the fees we charge.

@Brian Leland welcome Brian, you have come to the right place to meet people and learn about investing.

@Tyler Santos. When finding contractors you have a catch 22. Poor contractors are aways available and good contractors are always busy.

With our management we decided that it was easier to have in-house for minor rehabs. It prioritized our schedule while maintaining quality. Unfortunately you need to have volume in order to attract qualified individuals to work in-house.

In the end my advice would be to pay for a good contractor and add time for them to fit you in their schedule. A bad contractor can cost you twice as much with bad work.

@Jack Amaral after paying pmi and fha costs on the loan it would be impossible on Summit. Typically in suburban and nice areas your are looking at a .8 rather than 1% rule. The comments of @David Barnett and @Todd Dexheimer are correct.

There are other opportunities for you to be in good areas without losing your shirt in the process.

@Jasraj Singh we represent clients from around the world. My recommendations would be to ask the agent how they accommodate showings of properties for you from a distance, ask for references, and talk with them in person.

We handle acquisitions, management, and rehab for our clients so the client really needs to trust us with their money (we also need to trust them also) When we talk with clients we reassure them that we never have access to their rents (electronic payments go to their accounts), or bank accounts. We pay for rehabs out of our pocket and get reimbursed from the client.

You don’t want a management company or contractor having your money in their pocket it is too hard to collect from another state or country.

I would recommend FaceTime communication in the beginning so that you can feel comfortable with the person. If you have any hesitation with the person move on.

@Nathan McDonald honestly if it were my rental I would charge $150 for cleaning and disposal of furniture. I would refund them the rest of the deposit plus simple 1% interest. Many of the items look like wear and tear of a unit with deferred maintenance. The burn marks may have been there before (or could have been a mistake with a heater by the previous landlord). I would ask them about the items ( likely they may say they were there when they moved in, but maybe they would be honest). How would you feel if you were the tenant? If you had the checklist it would be different, and yes you could make them bring you to court, but is it right to do it that way? Have they been a good tenant in the short time you have owned it?

@Eben Rohling cash for keys is your best bet, but everyone knows there are no evictions right now and they can live for free for as long as this lasts (which may be more money than what you offer). There is not a good option besides riding it out. Talking in person may help, but we are all kind of stuck until the courts open up again.

@Anna Rynders I think you may run into zoning issues aside from the others issues. Most cities will allow an ADU if you are an owner occupant, but once you move out you no longer can have it.

@David Barnett we have had a couple of owners approach us to get BPOs (we assume they are seeing if selling is an option). We have to be honest with them and price them at LTR rates so we likely won't get their listing. We have seen a lot of brokers dropping prices on listings during this time. I think this is a temporary issue and it is better not to waste days on the market when everyone is in limbo. I have never seen so many deals On the MLS be cancelled as I have in the last month.

Most STRs are holding until the summer to sell when we may have lower prices than before, but will at least have stability.  A few I have talked to have converted to LTR since this is a good month for filling rentals, but with covid-19 the rental market is off too.  Lots of looking and inquiries not as much action as normal.

Right now we have artificially low prices (offers from buyers) due to buyers sitting on the sidelines and sellers that don’t want to give away their property.  It makes for a lot of nothing going on.  Great time to buy right now, but it is a very fluid market.