All Forum Posts by: Lee Smith

@Justin Young Yes we can help you with purchase, any level of rehab, property management, and sales... Or any part or piece of that puzzle.

Call or PM me for more info. Happy to help, or give a second set of eyes!

Bump still available.. Good home, would be great as a rent to own. I can help you through that process and advise how to best protect yourself and this asset with Indiana Law...

@Jason Million

Will this work if I have 2 duplexes(4 units) on the same lot? e.g.- 2 buildings with 2 units in each building?

@Nate Hammond

I hate recommending neighborhoods in Indianapolis.. Indianapolis is very much street by street. I have rentals I own and manage all over Indianapolis, and I find deals everywhere

You need to figure out your goals and your risk tolerance... You could do flips or rentals.. You could go Single family, or multifamily.. You could go low income or bread and butter...

Single families rent quicker and have tenants that stay longer than mutifams, but your cashflow is lower. Multifams take longer to rent, and you get quicker turnovers, but you get higher returns...

You need to decide where you want your rentals to be.. You can get higher returns in lower income areas(40-80k), but you won't see appreciation, and you will have more hassles with tenants. Bread and butter neighborhoods(80-125k) will see appreciation and better tenants.

Are you planning to get loans on properties from the get-go, then you need to find houses in better shape(will cost more) and there is minimums most banks will lend (40-50k). Banks don't like houses that need work, and houses that need more work are where the best deals are at. Cash buyers and people not afraid of work(or hiring contractors) are the best deals, but not everyone can be a cash buyer..

Once you narrow down your strategies, then you need to get good boots on the ground to help you find out where you need to be investing.

@Vincent B. 

@Ross Denman has some good points for checking your PM. 

We generally get single-family properties rented in 2-4 weeks. Multifams take longer 4-8 weeks.. 

Key factors to investing out of state is getting good boots on the ground in your local area... I can't stress this enough.

Things to keep in mind about multifams in midwest.. At least in Indianapolis, the multifams are generally in lower income areas. They are generally older 1900-1950's.. 

Multifams can be good investments, but you need to be aware of a few things.

• Turnover rates are higher: We find that tenants in single families stay 3-4+ years, tenants in multifams generally only stay 1 year on average.
  
  • A lot of tenants leave with a change of ownership in multifams. Doesn't matter how easy you make the switchover, the tenants just leave in a lot of cases.
• Longer vacancy rates: While I can generally fill a vacancy in a single family in 2-4 weeks. Multifams take 4-8 weeks. We get a ton of applicants, but finding good tenants takes time.
• Watch out for owner paid utilities: While paying water/sewer may be easily quantifiable, paying for electric and gas can get out of control quickly. When a owner pays for heat, tenants have a tendency to crank up the heat and then open a window to cool down.. 
• Deferred maintenances are always something to watch out for, but multiply that by the number of units when you start looking at multifams. 

Hope some of this advice is helpful.. Give me a call if you have questions, or just need a second set of eyes on a deal.

Investor Special:

Quaint 2 bedroom, 1 bath home with hardwood floors, a garage & a fireplace in Emerson Heights. Emerson Heights is listed on the National Register of Historic Places. Lots of natural light! Extremely convenient, only 1 block walk to a Kroger supermarket and numerous restaurants & only a 10 minute commute into Downtown and Mass Ave.

Needs about 6-8k in rehab(interior paint throughout, new furnace at some point, redo bathroom, fix garage). We can handle the rehab and property management for you if you need that!

Should rent for $650 a month

Almost $300 a month cashflow!

Link to ad including info, pictures, cashflow analysis and videos: http://spousesbuyinghouses.com/

@Ray Jansma  Here is the verbiage we use on our applications.

MULTIPLE APPLICATION NOTICE: In cases where we receive multiple applications for the same property, Standard of Practice 1-7 of the Indiana Realtor Code of Ethics dictates that we give all completed applications(including paperwork, background check, etc) to the owners of the property. Therefore, please send us your documentation as quickly as possible.

We generally just start processing everyone as they come in.. Our biggest slow down is getting responses from previous landlords. 

First thing we do is run the background, credit, and eviction checks... Then we go from there... Some of that you can look up for free. We are signed up with Buildium, so we just process their application fee, and process the background, credit, and eviction checks.

@Gabriel Cardenas Get a VA.. You will need to double check their work, but should be doable and more systematized.

@Brian Collins I seem to remember some small banks would allow you to use rents when you had a property manager being utilized. Thought process being that you haven't managed a property for 2 years, but the PM is a pro.  

Albeit, you can't consider the income if you haven't rented it though.  We could all come up with imaginary numbers for what a place could rent for after we vacate.. My house will rent for 1 MILLION dollars a month, I swear!

Might try Union Savings Bank in Indy.. Steve White was a great resource for me in the past.

@Brian White I guess it depends on what your township wants you to do. I am in Indy. There is no real correct form here. The courts here don't even validate you sent them a notice. Our notice is just a "Hey, we get it, times are tough!  You need to beg or borrow to get your rents because we don't want to file eviction, but our owners demand it......"

Our rents are due on the first and late on the 2nd. We send a pay or quit EMAIL on the 2nd. We give them 3 days to pay, or move out. We generally try to call or text after 2 days if they haven't responded. Most of the time they respond and inform us they are going to pay by X date.. If we(owner or us) are ok with that date we let it ride at $5 a day late fee.. We do tell them "You decided you would pay by X date, and we are okay with that... Now if you don't pay like you say you are going to, we will start eviction process, and when we do that, there is no going back..." 

We used to brag and boast about $10-25 a day late fees.. We switched to zero tolerance policy and $5 a day, and it was the best thing for us... Almost everyone pays on time.. Those that don't usually get paid up quickly...