All Forum Posts by: Steven Catudal

Hi all,

I just found out that my property taxes on my rental went up about $1,000 a month due to a $365k increase in the valuation of my home by the city. I purchased the home earlier this year and only put in about $40k into it.

Does anyone know if there is anything I can do or who to speak to?

Steven                      

One thing to clarify. He would not be managing the property himself but hiring a property manager to do that part.

Pretty much, I would be funding a large part of the deals and he would be doing all the leg work, getting it set up, and then managing anything that comes up.

Hi all,

I am looking to partner with a friend of mine to purchase some rental properties. I will be funding the deals and he will be finding the  properties, diligencing, and then managing the properties. What does the partnership split usually look like in these situations? 

Thanks!

Hi Jaycee,

Chose this area because my partner already had a section 8 rental here that is doing well and has a team set up.

I have no experience with section 8 tenants.

Appreciate the advice on starting an LLC. Do you have an estimate for what a lawyer will charge for this? Just a ballpark to make sure I am not getting over charged.

Steven

Appreciate the feedback. We are looking at this area because my partner has already purchased a home here that is doing very well and there is a team set up.

You also make a great point on the rehab part and I think you are right. Realistically we will be getting closer to retail pricing although we are are looking at some off market properties to try to get a discount.

In terms of cash flows, from the modeling I have done, there looks to a decent amount of cashflow on these properties when modeling at retail so I am curious why there would be no cash flow on BRRRR strategies? Is that due to taking a short term loan for repairs?

Hi all,

My partner and I are looking to buy investment properties in Alabama, specifically Birmingham. We are both out of state investors. We both own 1 property at this time. I had a few questions and would appreciate any advice in general.

Strategy / Goal: BRRRR but no major rehab at first to lower the risk. Plan is to purchase a couple homes over the next year. We want to get a few rentals up and running and then (if all works well) begin bringing other friends/investors in to invest with us. Current goal is focused on growing a portfolio and reinvesting cash flows. We are not focused on the passive income at this time as both working W2.

Questions:

1. We will be investing 50/50. What is the best way to structure the partnership? Should we start LLC?

2. For financing, would we then want to get a DSCR loan under the LLC or should we start with conventional loans under our name until we hit a certain number and then move them over? I heard that if you move the personal mortgages to an LLC they could get called and we would want to avoid that

3. Generally speaking, have any of you invested in this area and been successful? Did you look into renting to Section 8 tenants?  Would love to learn from your experiences.

4. Any advice for out of state investors that would be beneficial?

5. Any general advice for someone starting out in a partnership and looking to grow a portfolio?

Thank you in advance,

Steven

They moved in prior to my purchase of the home, so I did not do that and the last owner did not provide anything.

Updated subject: Damages after inherited tenants move out

Hi Folks,

I bought a home a few months ago and the tenants I inherited are now moving out. There is some damage to the home (broken doors, nails and holes in wall, bad odor due to not cleaning (and cats I assume), and destroyed carpets.  All in all my contractor quoted repairs around $2k.

Am I able to withhold from the security deposit to pay for repairs? What if they say those damages were there before they moved in?

Thanks!

 I think this is great advice!

1 . This is all about the compromise you are willing to make. You can look into finding a duplex and renting out half or finding a property with a small guest house that you could rent out. It seems like you may live in a rural area so if you have land, you could look at finding ways to buy a place that has land that you could utilize (storage, guest-house, sports area).

2. Start talking with lenders now because they can give you an idea of what you can afford. They will also be able to work with you to help you get better credit or optimize finance to afford more. I would recommend starting with a local / smaller lender as they can give you more attention vs a rocket mortgage. 

3. Tell him your situation and what you want to do (i.e., investment) and they have some criteria ready such as you want a private living area for your family, backyard, # of bathrooms, etc.

4. If you cannot find meetups, spend that time in these forums reading and chatting with others

Bonus: 

-Pick one book on flipping / house-hacking and read it. BP has some good ones but there are TONS! 

-Listen to BiggerPockets podcast every day. Some might not be relevant but you will pick stuff up over time

-Do you now any friends/family that have a rental or bought a house? If so, reach out to them and ask about the experience