All Forum Posts by: Ryan McKean

@Josh Nicolson when you say contracting, do you mean that students are moving closer and closer to the UofA area and thats where the demand is? 

Thanks for the input on rent. It would seem 1.1-1.2k is the sweet spot according to all of you.

@Alan Grobmeier I appreciate the wisdom, thank you. I realize I will make a ton of mistakes with this, but I hope my mistakes wont cost me too much, either! This might be asking a lot, but if you wouldn't mind sharing the criteria you follow when deciding to hold or sell, I would love to see how you work this out.

@Brian Mitchell I also found the 1% rule to be tough given my previous assumptions of rents @ 1k+-, but if @Naftali Tolibas got it right on the rents in that area, I should be in good shape. All in cost on this deal is 100k on the high end. I'm currently getting bids for the work to be done, so don't have exact figures just yet. And thanks for the offer, Brian! I will absolutely use you as a resource if something comes up. 

On the 1% rule, I have heard people say 1% is not enough, and that 2% should be the target. What are your views on this?

@Naftali Tolibas This is what I needed to hear, thank you so much. This deal is a complete remodel so everything will be brand new. I view the area as a bit rough but it has its charms for sure. I live in Phx and do not know the Tucson area too well, so your answer was super valuable. And if you have any other tips for having rentals in this area, I am all ears.

@Trevor Muzzy Thanks for the guidance. what areas of Tucson are you looking that fetch these kinds of rents? 

@Naftali Tolibas Thanks for jumping in. What are your thoughts on the speedway/swan area? Is this a desirable place to live? What would you pay for a remodeled 3/2b per month?

@Brian Mitchell this deal is about 3 miles away. do you feel this is too far from campus to pull in rents like 1200-1300 or too far for students to live in? It is on Speedway, so its a straight shot to campus.

@Alan Grobmeier Thanks for your response. I absolutely agree- trying to fetch a couple extra bucks per month is not worth the cost of vacancy.  

The stressful part about not knowing the rents is the potential to have negative cash-flows if i cant fetch what i need. How do you approach deals with this kind of uncertainty? Do you think it is unwise to pull the trigger on the deal if I cant determine rents? I'm no doubt going to capture a lot of equity in this deal, so flipping is an option, but I would rather not.

@Jim Sestito thanks for the advice. I will keep researching rents. Luckily, I have a month or so before I have to pull the trigger on this deal, so hopefully I will find what i'm looking for.

@Kevin Phu 1k is exactly what my assumption has been when doing my analysis, but unfortunately, that wont be enough cash-flow for this deal to work out. I have seen some remodeled 3b/2b going for 1100-1300 on the high-end in this area, but i only have like 3 homes to go off of. Do you think it is unreasonable to think i could get a couple hundred bucks over 1k? do you own rentals in this area?