All Forum Posts by: Teague D.

Thanks for the reply, Chris. 

Hello,

I have read many forums on here in the past and thought I would seek some advice from those of you who know a lot more about this than I.  My wife and I rented our first house and bought our second house which is needing about 20k in updates.  We planned on slowly updating our new home (which still might be the best option) but have grown frustrated living in a home with carpeted bathrooms and 3 kids.  As I see it here are our options:

1) Keep rental and continue to slowly save cash and update the house (this admittedly will take us awhile and I don't know if I can hold the wife off for this long)

2) Sell the rental.  Use the equity to update our home.  We will avoid capital gains tax because it's only been a rental for 1 year and we lived in it for 4.5 years before.  

3) Keep the rental, take out a remodel or personal loan at aprox 5.5%  and do the updates.  Probably do this at a 3 or 5 year term.  

Here's some info on the rental.  It is in a very good rental location, we found fantastic tenants in less than 1 week.  Some of the updates + the location drew a young professional crowd of people wanting to rent it.  

Total monthly payment including taxes/insurance = $675

Current rent = $1150 (I think we could get it $1200, maybe even $1250, on the next lease)

Our current tenants have been fantastic, handling basically everything on their own and paying on time.  I am not sure if they desire to re sign in May at the end of this lease.  

Here's some info on our current home.  We bought it for 235k, the principal is 218k.  We're the cheapest house on the country culdesac and jumped on it because it has a rare 2.6 acre lot in a top notch school district.  Other homes on our culdesac range rom 290k to 550k (there are 6 total houses with similar lots on our culdesac).  Maybe I'm being optimistic but I can't find any reason our house won't be worth 280K+ with the 20k in updates (we've already knocked out walls and done some cosmetics in the main level- what we're after now is hardwood floors and bathrooms).  I had watched this market for 3 years and it really is a pretty desirable set up in this area. 

I appreciate any advice you guys may have.  We took on some risk to jump on our current house because it is so rare in this area, and I want to make sure we do what's best moving forward.  

Thank you!

Zach,

Thanks for the wisdom, man. Much appreciated.  Just had a friend move near Ravinwoods Rd... Great area.  Good luck in building your portfolio!

Teague

hey Blake,

My names Teague Dentino.  Let's do business.

Awesome. Thanks guys! Really appreciate the feedback.

Thanks for replying. I appreciate it.  I suppose I'm just a little intimidated by a triplex.  Also, it almost seems to good to be true.  As you said, there arent a ton of triplexes in the Peoria area and this one has been on the market for over 2 months.  

Josh, what is a 'C' area? I'm sorry I should probably know this if even considering making an investment.

hey folks, I'm a rookie so please be kind.  I'm wondering what you think is a better investment for a guy in my situation.  A single family home in a good area with a good possibility of the house value raising with $210 monthly cash flow (using 50% rule).  Or, a triplex, in a much less desirable area, but with a cash flow of nearly $550 per month (50% rule). 

Things to consider: I do not plan on doing this full time. I am looking to make my FIRST real estate investment (other than my personal home). I would like my first investment to be a very safe purchase and am willing to sacrifice some cash flow for security until I get a better grasp of the process. 

Thanks so much for any feedback. This site is awesome and such a supportive community!

-Teague D.

Hello,

I'm a teacher/coach in the Peoria area.  I'm currently trying to educate myself before pulling the trigger on a single family home rental.  I absolutely love teaching/coaching, but I really desire a second income/challenge to work towards.  I've been eyeing the market for a couple years now.  This site has been a fantastic resource and I look forward to learning more!

Thanks,

Teague