All Forum Posts by: Tanya R.

@Jonathan Ramos

1. FHA

2. Property had 2/3 units rented when purchased, but I choose to do some basic renovating to attract higher quality tenants and currently only have 1/3 units rented.

3. No, as I have vacancies due to renovating.  

4. Yes

I'm curious about Home Ready.  I did a quick search and they seem extremely flexible about source of downpayment and qualifying income.  Are you thinking keep your single family home, leave your equity (and low interest rates) alone, and use this instead?

@Jonathan Ramos  I recently closed on a multi family in Manchester.  Not a NH native but been around the city a bit.  Feel free to shoot me a message with any questions.

The right multifamily will cash flow, but depending on the area you may or may not be able to attract good tenants.  Hard drug use and poverty is very obvious in central.  The north end seems the nicest but with the least multis.

@Tom Jones If you want to get an idea of how properties in an area cash flow you need to look up listings for what you're interested in to see what they're selling for.  Then, hop on Craigslist and research apartments in your area and see what they're renting for.  Also note if most of the listings are renovated, offer laundry, parking, utilities included etc.  If the majority of listings have parking for instance and yours doesn't you're gonna get way less prospective tenants and will need to rent for cheaper than the majority.  This is fine if you scored an amazing deal and can make the numbers work..

Are you committed to Amherst?  I lived in MA for years but heard enough eviction horror stories to decide to be a landlord in NH.  You're not too far from the Green Mountains if you wanted to do vacation rentals, and you could also look into Keene, NH for student rentals.  I'd think harder about student rentals.. will they be profitable despite 3 months of vacancy over summer break?  Also you'd have tons of turnover as tenants graduate, change roommates etc.  That's a lot of wear and tear on a building with 1-2 adults per bedroom who know it's a temporary living situation vs a couple with two kids who want to stay there until the kids graduate high school.

Also, don't immediately write off a property manager.  They cost 10% of your rent usually, which you should account for anyways even if you're gonna be the property manager.  Your time is money and if you need to take time off work to show the property to prospective tenants or head over there to inspect a repair etc you might find that 10% is a bargain.

$300/month profit means something like having to call a plumber out there could eat up your profit.  If you have a month or two of vacancy or non payment you could end up in foreclosure.  If you meant you're living in 1/3 units, profiting $300, and still keeping your job that's different.. but it sounds like you want to buy an investment and live elsewhere.  

Just keep researching and running numbers and you'll figure out what works for you.

Agreeing with what everyone else said.  A fellow investor told me courts ruled against evicting non paying tenants because they had children and it was winter.

Another investor friend is successfully renting units in MA, however they only rent luxury condos to single professionals in towns such as Burlington and North Andover.  Doctors are their preffered tenant as they have stable work, a reputation to uphold, and leave minimal wear and tear due to their schedules.  

I purchased a three family this spring with an FHA loan. I still have money left over and by next spring I should have 10% down plus reserves for a sfh in need of renovations. I could then rent out the unit in the first property I currently occupy, the rental income would be greater than the payment for the sfh. Once doing the renovations to the second home and making regular payments I think I should be able to use the equity towards buying another multifamily. If I keep my debt minimal, bring my credit score back up a few points with regular payments, and maintain my income would lenders consider this scenario?

@Troy Zsofka Thats frustrating that the program worked out that way for you.  I'll definitely be aware of that.  It does sound like they pitched the program to you with only their best interest in mind.  Mike's advice is good, at the very least they could justify to you what the "mandated" quote includes that they otherwise wouldn't be providing.

@Mike Hurney So that's the hustle?  I sensed something was up but couldn't pinpoint it.  I was very happy with who I ended up using.. not sure if I can mention the company or not on here, but I'd be happy to message his info to you.  I found my quotes differed by about $350. Some of the higher prices included extras in the report including neighborhood and crime stats and reports of toxic waste in the neighborhood.. but I am already aware of that from the research I did selecting my area so I did not see the value.

@John Hickey NHSaves.com  Keep us posted how it works out for you.

Thank you everyone who replied. I'm glad that this isn't a reason to jump ship on this deal.  I'm starting to think some of the inspectors I spoke with wanted to emphasize the potential problems and repairs to justify their own costs for identifying and preparing a report.  I definitely want my property in the best shape it can be and I want to attract the best tenants.  I just wasn't sure if the (potential) lack of insulation is fixable, deal breaker, or just something people live with in old houses.

My property is in New Hampshire, but I'm happy to say they've got their own version of the program.  For anyone who reads this and looking for the info, it cost $100 for the audit which goes towards to cost of your project.  If you qualify, the program covers 50% up to $4000.  This includes lighting, water, air sealing, and insulation upgrades that will help you conserve energy.

@Roy N. Thanks for the additional resource, and that is fascinating that this type of housing made it up north as well.  Before I considered investing I didn't pay nearly enough attention to these buildings.  

@Roy N.  Thank you for your informative response.  I will see what the inspector finds, but if needed I'm prepared to insulate the attic and rim joists in the basement come fall.  From what I've researched that can make a big difference.  The particular style I'm referring to is constructed from wood with identical units stacked on top of one another with a flat roof.  They are unique especially to Boston but also to other major New England cities that needed to house many families to work in mills and factories back then.  San Francisco appears to have them as well, although I'm uncertain if they're constructed differently.

That is unfortunate about the high operating costs of those buildings as I am sure they are beautiful and it enhances the neighborhood to have them maintained and occupied.  I am fortunate that in my area it is common place for tenants to pay their own utilities.  

I have a home inspection coming up Monday for a 3 unit triple decker style home that was built in early 1900's.  It's been mentioned that it may lack wall insulation based on age and listing price.  While that sounds very alarming, should that be a deal breaker with this type of property?  These older buildings were designed to stay warm despite modern day insulation.

Renters will be paying their own utilities anyways and since the property has a history of long term tenants that indicates nobody's too inconvenienced trying to keep their unit heated.  This property also has new windows which will help retain the heat.

I've rented in a very similar triple decker and a converted multifamily built in 1820, both were drafty which had their inconveniences on the stormiest of nights, but I never felt like I had to move out to find an easier to heat place.  I'm currently in a modern day complex and thanks to the oversized windows and slider that have actually allowed snow to get in I keep the heat on so much my skin dries out.

Should I be concerned?  I feel talking to these inspectors has got me nervous.  I understand that finding a cash flowing deal in my area will require improvements be done at some point in time and I don't expect to find a property in near perfect condition.  I just want to make sure I'm going into this with the right state of mind.