All Forum Posts by: Sehun Kook

How did you close this house??? 

Have you not done any inspection before closing? 
Have you not checked all the designs and upgrades you chose? 
Sorry that I am not sure how to handle it legally against the builder

Thanks @Neil Aggarwal

I found some threads on BP that some tenants did not pay water bills for a long period of time and all those bills came to the owner because water/sewer account could be set under only the owners in some states.

Even the lawns and yards are taken care of by the tenants? Is that a general practice or case by case?

I actually thought that the owners should handle the lawn and yard just like big apartments managements do.

Thanks again for your feedback. Your input really helps. 

Hi, all

I searched but only found threads in the other states/cities/markets, and the answers to my questions appear to really vary a lot from state to state.

I would like to specifically know in DFW what the owners cover for tenants when renting a SFH out.

My common sense tells me that tenants are responsible for electricity and gas for sure, and owners pay for HOA, property tax and home insurance.

Do you require your tenants to have a renter's insurance as well?

What about water/sewer/trash? Is the bill for water/sewer/trash attached to the owner or transferable to tenants?

Do you also pay for lawn mowing and/or termite/pest control service?

At what level of repair/maintenance do you offer as long as tenants do not break with their abuse/neglect? (i.e. bulb replacement, A/C filter replacement, etc?)

Thanks a lot!!!

@Bruce Lynn Wow, thanks a lot for very detailed comments. I am reading it several times already. And, you have a really great point about rent to purchase ratio... it may be low today but can increase in years. Thanks to you and @Robert Steele, now I am switching my interest and target. With no experience in this area so far, dealing with problematic tenants and a lot of issues appears just too risky for me. I will definitely ping you soon for coffee and interesting and productive discussion!! 

@Robert Steele Thanks Robert again for your comment. With short study/research, I was actually leaning toward a class C neighborhood but your suggestion is changing my perspective... probably I should forget about cash flow and look at some quality neighborhood because I have ZERO experience with tenants and I do not want to get exhausted by a lot of hassles with tenants in the class C neighborhood..  

May I ask you what price range of property/properties in the good, quality neighborhood you are buying recently and how much rents you are collecting from those? Your experience will give me some guidance. Thanks a ton again!!!

@Robert Steele Great point, Robert.

No one is certain about the future but I wish I could work for next 20yrs. :)

I acknowledged that I did not make myself clear and was misleading with positive cash flow. In fact, I do not need cash flow because I am able to max out 401k, do backdoor Roth IRA, and still can invest in stock/bond right now with my current job. However, due to future uncertainty, I do not want to hold properties with "negative" cash flow. In another word, "even" or "zero" cash flow after all the associated costs for the ownership is great, and I will be totally happy with that. I understand some temporary out of pocket costs or negative cash flow for a few months but do not want any property that constantly drains my savings/other investments.

And, you got exactly my concern about condo and class C neighborhood: too many problems with tenants, which may drain so much of my energy, mentally and physically. I did not do enough research yet, however, I only see opportunity so far in poor neighborhood properties, especially condos and multiplex. With current rent price range and house price, my math simply does not give me "even cash flow" in quality neighborhoods. (I don't expect more than $2,000 rent for the $300s house.). And, I don't expect much appreciation in DFW from now since I think the market seems to be pretty saturated, but I hope I am wrong.

Anyways, your feedback was very well received and really appreciated. Your suggestion makes me do more research and open more options with proper risk assessments.

@Art Perkitny Thanks a lot for your suggestion and awesome maps. These maps indeed help me get an idea of which areas to look!!! Really appreciate. 

@Wes Johnson Thanks for your feedback!!! I want to eventually balance between cash flow and appreciation but am thinking the cash flow property seems a good starting point for beginners. I have not found many multiplex available in DFW and most of them seem to be in a C class neighborhood. Is that correct? Which areas should I look if searching for multiplexes?

@Kenneth McKeown I appreciate your detailed answers. I see definitely negative cash flow in a class A neighborhood and do not want to start with such property/area because some positive cash flow, even if small, can give me some momentum to keep me going. For that reason, although I live in Frisco, I do not look at investment properties in north Dallas and my living area and am open to all areas of DFW. I see huge appreciation and crazy bidding in bay area so I don't feel much appreciation in DFW although a lot of folks in DFW area said big price increase in recent years. To me, I will be totally fine if appreciation can follow inflation, and in a long run, buy and hold would have some appreciation, I believe. DFW is a huge metro and seems to have very various and wide levels of neighborhoods so I believe DFW is an excellent REI area in terms of diversity, but at the same time, it is a little difficult to set a target and plan for beginners because there are too many options and strategies available. I have exactly the same feeling on Condos as you described, and that's why I was hesitant even though math gives me good opportunity with positive cash flow. I guess I need more research and study to set a right plan and target at this moment, and your feedback really helped a lot!!! Regarding your two more purchases, are you buying those two properties in a class C neighborhood?

Hi, DFW experts

I am a newbie to both Bigger Pocket and Real Estate investment and am absorbing a lot of information on BP now and learning from all experienced experts here. Really appreciate all for sharing valuable experience and knowledge. 

I relocated to Dallas from Bay area last year and am having a healthy W2 job that I would like to continue for at least 10 years (or more) but would like to start REI and build my own portfolio of equity in real estate for financial freedom. (rather than early retirement).

Now, I live in Frisco (Coit and 121 highway) and have no experience in direct real estate investment except REIT and crowdfunding. I bought my primary homes twice (one in bay area and the other one in Frisco, TX) and sold my first home in bay area only once in my entire life.

With that said, my current strategy is to buy and hold multiplex and single family home for a long run that can generate monthly cash flow, and I would like to expand the units slowly. 

Now, as a very uneducated, baby investor (and relatively new to DFW area),  I have some questions and would like to hear your opinions. 

1. I went through the forum and learned that it's very hard to find a good deal "these days". Market has been good, and housing price is continuously increasing and at peak across most of country. I understand DFW is a big metro covering wide areas, and each city/county may vary widely, but is 1% still applicable in DFW in general? What % (monthly rent / purchase price) is a rule of thumb number that is generally used in DFW area when considering a good deal (or not bad deal)? 

2. Similarly, is there common break price point in DFW that typically makes positive profit/cash flow? I believe various population are spread out in various rent range but think at certain purchase price it may be very difficult to find tenants or to make positive or even profits. 

3.  Considering DFW population with wide range of incomes, I strongly believe that there will be always rent demand in any area at any rental price, if the price is set at a proper level. From rental websites, I see $1000 - $2000 is the most popular rental price range for single houses depending on the condition, size and location. Small condo and APT seems to range from $500 to $900 in general. Is my study reasonable? 

4. What type of property at which price range do you recommend to extremely beginners like me?

5. What do you think of those properties for a beginner? Those are very cheap and small condos that I would not expect appreciation in the future but generates good cash flow with 40-50% down payment. Thanks to the positive cash flow, I see low risk and think it can give me a chance to get into the REI water and learn through experience. Or is this type of condo/APT not a favorite investment regardless due to no appreciation, costly HOA, etc? Any opinion/feedback would be greatly appreciated!!

a) 9617 Walnut st APT 4105, Dallas TX

b) 3121Park Ln APT 1126, Dallas TX

6. I will further invest my time and dig into more threads and information on bigger pocket, but if you have any valuable tip how to start for newbie like me, please share with me. 

Thank you all for your time!!