All Forum Posts by: Rodney Kuhl

Will be there, looking forward to it!

We are looking to sell one of our rental properties before the end of the year. The property is located in the Lawrence area of Indianapolis at 6037 Marilyn Rd.

The property is a 3 bedroom, 2 bathroom, 1-car attached garage, 1900+ sq ft house with a fenced in backyard, big upstairs loft, storage shed and 2nd structure in the backyard with plumbing. Overall, the house itself needs some cosmetic work. The flooring was pulled up after the last tenant, so new flooring is needed. Additionally, some minor work on the drywall, light fixtures, cabinets, and bathrooms would do the trick and get this property back up to full speed. Overall, probably somewhere around $5,000 to $6,000 of rehab. Once the rehab has taken place, should be able to rent this place for $825-$850/mo.

https://www.dropbox.com/sh/npztlzpq84t3z8q/AAAXAvgLL3ScI3vQ-SmoEixka?dl=0

Purchase Price: $49,900 or Your Best Offer
Rehab: ~$5,000

Rent: $800-850/mo

The property is being sold As-Is. Buyer pays closing costs. A $2,000 Non-Refundable EMD secures purchase.

Thanks, @Clay Manship! Hope all is well man. I got it figured out now

Previously we were offered the option to purchase a vacant lot that is connect to a lot that we own with a rental property on the land by the tax assessment office of Marion County in Indianapolis. The lot's taxes hadn't been paid so the assessor's office offered it to the owners of the two lots connected to it. But part of the deal was that we had to combine the new lot with the lot we already owned.

But now, lots in the area are going for a pretty high number, so we would like to separate the two lots and sell the vacant lot while still keeping the rental property on the other lot. Has anybody in Indianapolis done this before (I'd assume so), and if so, what steps do I need to take to separate the lots? And what are the costs to do so? Thanks in advance for any advice!

@Sam G. I tried to click on your link but I couldn't access that page. I'm not sure how you'd calculate it to be 8% COC returns without seeing the numbers. Especially if you used 10% for those 4 expenses (40% total), as you'd still have taxes and insurance.

@Sam G. Well. Let me start by saying I don't know this property, I don't know this company, and I have no interest to either party. I'm not trying to sell anything, just to point out my thoughts.

The first eye opener to me is that on that exact webpage that you linked to the property shows the property valuation to be $31,000-$58,000. But the sales price is $69,000!

Second, I'd always recommend for a person to come see the property in person. Pictures can hide a lot in a house.

The numbers can say whatever you want them to, but that doesn't always happen in reality. I'm not sure what assumptions you used for your calculations. Based off what you said about not knowing how to go about the due diligence, I'd suggest using 10% for vacancy, maintenance, and management, and then you can figure out actual taxes and insurance costs.

I can also tell you that this property is located in an area that will not be seeing appreciation any time soon. There are plenty of areas in Indianapolis that have seen and will continue to see appreciation. But there are also plenty of areas that don't and will not appreciate. I bet in 10 years this house will be worth the same as it is today (or very close to it).

I'm admittedly conservative with my numbers, but I don't calculate the same returns.

Best of luck!

@Jithin Yohannan You may be planning on buying and holding for the long-term, but I still don't think you want to overpay for a property. Your cash flow numbers may look good, but what if you have an emergency and have to sell in the next 5 years? If the comps are really $15k or more less than your purchase price, you'd take a big loss on the sale because you wouldn't have paid down much of the loan by that point. That may negate any cash flow you made during those years.

Thanks for the help guys!

Hello,

This is the first year where I have to issue 1099s to contractors as we fixed up a couple of properties in Indianapolis. I have received the W-9 forms from both contractors that we used. As I'm filling out the 1099 form (from online) I came up with a question. This may not make a difference one way or another, but figured I'd ask anyway. Sorry if this it's irrelevant no matter which way this is done.

These 2 houses were purchased in my individual name so as to allow us to get conventional financing on the properties. When issuing the 1099 form, do I issue it from my LLC or from myself as an individual? Also, I assume the amount of money paid to the contractor goes in line #3 Other Income, but please advise if it goes somewhere else.

Thank you in advance for your help!

I am planning on attending. Looking forward to it!