All Forum Posts by: Brandon Cao

Sometimes it's good to get your feet wet. Instead of jumping into a lake and learning how to swim, you're jumping into the shallow end of a pool. You can learn a lot from landlording in the beginning especially from easier tenants. It could be worse, at least you'll know you'll have cash flow when you acquire the property. Good luck!

You want to look at the cash on cash return. For a more expensive project, you'll have to present more cash in the downpayment. Saving more cash on hand leaves you with more deals. If however, the cash on cash is the same, run the 50% rule and then you might want to pick the one in the better neighborhood.

Hi Everyone,

I wanted to start a thread discussing your favorite Luxury Vinyl Planks you use in your rental properties. Please include your Brand name, Model/Color, approximate cost/sq.ft., if you order it Online and delivered or pick up at your local big box store, and finally why you liked it. I'll start:

Brand: TrafficMaster Allure Plus

Model/Color: Hamilton Oak

Approximate Cost/sq.ft: $2.00

Bought How? Bought and picked up at my local Home Depot

Why I like it? I think it has a nice neutral color, not too flashy. Has a close texture to wood, although I think there's still room for improvement texture-wise. Finally, it's floating and self-sticks to itself which is important for my uneven floors.

What's your favorite?

Here's an example for the experts, Would you:

Option 1: I found a bank that is willing to do 70% ARV loans 5ARM/25 yr amortization with a 20% downpayment required @5.75%.

OR

Option 2: Should you get a Hard money lender with 100% purchase, interest only payments and then eventually refinance after 6-9 month seasoning period (probably at the same 70% ARV loan etc...). This way I recoup the 20% downpayment that I would have lost going with option 1 (except interest)

Unless you are very knowledgeable of the area, I would avoid Kensington. It's not up and coming and can break you if you rent/inherit the wrong tenant. I heard a lot about Port Richmond. But I would stay more east away from Kensington. Up and coming area is Northern Liberties, although it could be too expensive already, I haven't checked the market prices there in a while.

I would also recommend talking to a broker, they can give you options on FHAs, although they are all pretty much the same. Minimum downpayment is 3.5% as Wayne pointed out. Also, I believe you can ask for up to 6% in sellers assist on FHA loans. Although it can be tricky if the seller does not have that much cash on hand. If you are purchasing in Philadelphia, there is a 4% transfer tax (Usually 2% for the seller and 2% for the buyer) that is paid at closing.

I've only done brief research on Port Richmond, I haven't been there personally, but you want to stay far away from Kensington. I would say that between Frankford Ave and Kensington Ave might be a bit too risky particularly if you are an out of state investor. Perhaps try more southeast of Frankford Ave if you're still interested in Port Richmond.

Hi Sophie,

I haven't yet, but I will in the coming months. I talked with my mortgage broker and he said that the best evidence you have for arguing your property taxes is your purchase price. Also, if you got a 3rd party appraisal for your mortgage, you could probably add that to your documentation. You may also want to include a couple comparables as evidence. My girlfriend and I are currently in the process of purchasing a house that last year was $900/yr in RE taxes, but after the Actual Value Initiative in Philly, will be closer to $1900/yr for 2014 if we don't appeal.

Hi Amy,

It depends on what kind of policy you are looking for. If you are going for a Landlord policy at replacement cost you are probably getting a fair quote. If you are going for a actual cost value, you may want to keep searching. I have Allstate for a comparable ACV triplex in Philly at about $1800/yr but I hear they aren't very compromising for when it comes to a claim. I also got a quote for their auto insurance to bundle but it came out 35% higher than my current plan. I believe they required Home and Auto bundled in order to get Umbrella policy

I use Behr Ultra Premium Antique White, Eggshell finish. Looks great on the walls, I didn't like it at first when looking at the palette sample, but when its all on the walls it looks great! Behr Ceiling White for the ceilings and Behr Swiss coffee semi-gloss for trims.