All Forum Posts by: Thomas Guertin

Are you buying and holding? flipping?  multifamily or single family?

Why wouldn't you try to get a good deal on a home in Belchertown and rent it out?  Get something that is run down a little but needs a little TLC to bring it up to rentable condition.  The schools are good there.  Do you know what the market rents are in your area?  If not, figure that out and run the numbers.

If you go into Springfield, the first question people will ask is if you take Section 8.  Do you know the answer to the question, if not, you could wind up in court for discrimination.

Tom

Hi Denis,

I don't think it really matters what you charge because you will never see the money and the judge will probably not give it to you anyway.  Be more concerned about getting the right person in the unit that won't be late.

Tom

Look up Bob Couture on Bigger Pockets. He runs the local REI and we have a facebook page that we share this information on. It might be something to help you out.

Tom

Western Mass properties are between $100,000 and $250,000.  Agents will make 1.5% or $1,500-$3,750.

Tom

You may not "legally" need to take care of the water issue but you could end up in my situation.

Tenant gets a mold test done and finds mold in the air.  Decides to stop paying rent.  You try to evict the tenant on the grounds of non-payment.  They claim retaliation, counter claims health issues because of mold and requests a jury trial.  So now 5 months later with at least 2 more to go, you are out 5 months of rent, $7,000 in legal bills (and counting-we are not even at trial at this point) and by the way, if the tenant wins their case, the insurance company probably will not cover the judgement as it is excluded in the policy.

Also, if the tenant decides to call code enforcement and they find mold, now you have to remediate professionally (again not covered by insurance) and it will cost you about $15,000 or more because they have to do the whole building to kill all the mold.

Oh, and by the way, the tenant called code enforcement and there is no visual mold but all this is going on anyway.

So legally, you may not have to but it will cost you a lot of money when you get a tenant who can play the system.

Make the attempt to fix it so you can say you did.

Tom

Hi Meg,

My 2 cents is that you do not buy a second property until you are out of college.  Way too much on your plate.

I am in a situation (in MA) that I am trying to get rid of a high maintenance tenant in which I tried to raise the rent $25 and it has cost me $7000 in legal fees and $7000 (5 months) in lost rent and we are still in the legal process in eviction.  They will be there at least another 2 months ($2800 more in lost rent) and I don't know what the outcome will be.

I would save up as much money as you can before you raise the rent and try to evict them.  At least in MA it can be a chore to get your tenant out.

Tom

Typically, you would get a loan on each property separately and go through the commercial loans dept not the residential.  You will also need to have it rented with a signed lease to get the loan approved.

Call all your community banks and talk with the commercial loan officer.  The down payments and terms tend to differ between all the banks.  The rates will be higher than a traditional mortgage and usually 20 years not 30 years for the term.  Also the rate adjusts after 5 years and is not locked in for the full term.  You might find better terms than that but that is what I found.

Tom

If you need to go outside your immediate area than I would spend the next 6 months looking at every single house that goes up for sale in the couple towns you chose and try to understand why their priced the way they are.  Also, get a realtor that knows that particular area well.

I have a realtor that I use that is great for the town he is in and surrounding communities but for the town I grew up in, which is only 20 minutes away, he doesn't know the market as well.

I would also check out the rentals as well so you can understand why they priced it the way they did.  Some are investors that understand how to make a profit and others have inherited property and they try to be landlord/investors without knowing the numbers.  This could be why you see some prices really lower.

Tom

If you make the apartments look nice then you will get a higher rent, if the apartments are dated then you will get a lower rent.

I would make sure that the school system (K-12) is at least okay if not desirable, then people will move into the city/town.  With a one or 2 bedroom it might not be as important but when you go to a 3-4 bedroom, you will have kids involved.  They parents will pay a little more to get into a town with a more desirable school system.

I personally would try to stick to the towns around me that I am more familiar with because you don't want to be the one who bought a property that no one else wanted.

Tom

It sounds to me that you are new into the rehabbing business.  If that's the case, I've heard and read in different places to stay away from foundation issues so being new, I would take that advice.

If you get a few rehabs under your belt and then want to get into foundation issues then I would try it then.  For everything else, I've heard people getting a competent general contractor in to give you an estimate on the rehab cost.  If you guess and are wrong, you could lose money on the deal.

Tom