All Forum Posts by: Tony H.

Jason Chen my property is doing okay. I wouldnt say it has great cashflow like others who invest out of state, but to me this is good enough as learning curve. Here are my rough numbers: Purchase price $303000 Repairs and Closing cost is about $7k Down payment is 25% Total invested about $83000 PITI is about $1550. 1 unit was rented and the other was vacant. The one with long term tenant was at very low rent, $800/ month! Market was at $1200. I managed to rent out the vacant unit at $1300 including $100 water garbage sewer. Starting this September, i increased the old tenant's rent to $1025 including $100 water garbage sewer. Plus I got them to agree to maintain yards for the property. They are gardeners, so they have all the tools. Rent income total $2325 PITI + water/garbage/sewer about $1800. No PM Net income $525 per month. If i account for maintenance and repairs + capex, i probably make only $100/ a month. My goal is to bring the lower rent gradually up to market. This should increase my cashflow overtime. Im a newbie too, so im sure a lot of people here in BP dont like my numbers. But I am hoping for appreciation mainly. Hope this helps.

Jason Chen hey Jason! I am a new investor as well from Fremont/Newark area. Just to share my two cents with you. I recently acquired a duplex in Sacramento, close to Sac City College. I'd say its a B area. When I was looking, I did consider the C neighborhood. However, to me the added cashflow does not work for me. Why? 1. Dealing with C class tenants are not easy for beginners like me. Most likely I will have to pay a PM to manage. 2. More repairs probably required. 3. After reading quite a few postings here in biggerpockets, it seems that class C tenants have more drama - the added cashflow is not worth for me to get migraine lol. I was also considering SFH, with class A tenants. But the numbers definitely dont make sense if you are trying to get some cashflow. So, I settled with a B class. Closed at beginning of July with one tenant in place. Then placed the 2nd tenant within 2 weeks after that. So far so good. Have not heard any issues. I dont use PM. One of my tenant used to deal with PMs all the time before I purchased the duplex. They are now much happier to see me as the owner. Their problems were pretty much ignored by the previous PM. Meanwhile, I try to make them happy but reasonable. Good luck!

@Ned Jackson thanks! The tenant in one of the unit has a LOT of stuffs that its impossible to do improvements. They are still on lease with me for another year. I will keep it in mind. Thanks again

I thought about BRRRR but I want to keep it for now. My goal is that I want to have a few paid off property by the time I retire - 30 years from now. I guess I will take it slow.

I closed on my first duplex almost 2 months ago. So far so good. I used HELOC from my primary residence as down payment for the duplex. I now have $77k balance on the HELOC. My monthly cashflow covers the Heloc payment with no issues. However, It will take forever, To reload my heloc and use it again for my next deal. Paying 1% each month will take 100+ months (thats without even counting the interest). How do you reload your Heloc quickly? I saw some people buy their next deal within 1 year after, but I dont see this possible at all. I have been putting extra payment too but not much at all. I have also resorted to a new strategies where I utilized the 0% and $0 fee balance transfer from credit card to help pay the heloc. Its a bit pain in the butt, since the offer only last about 15 months. Then I have to find another credit card with similar deal. I am doing this because I want my whole payment every month hit the principal, not a penny goes to interest. Any other ideas that I should consider? Thanks

@Steve Bracero I met the tenant after closing and took pictures of unit conditions. 

I decided to raise their rent to $925 + $100 water garbage sewer per month. I waived the pet fee. I took their words when they say the reason they got the dog is to keep burglars away. I maybe wrong doing this, but they have had their dog for 3 years there. I didnt see any 'pet' damages in the unit. It was pretty clean too.

I also ask them to continue maintain the yards for the whole duplex. Their lease with me starts September.

When I sent them the notice of rent increase, i stated my reasonings. 

They countered back saying that their unit condition is worse than next door. However, i managed to get them to understand that their rent is 30% below market because of the older condition than next door unit. 

I also mention that If they want me to put new carpets and paint, they have to move out temporarily. And when they come back, rent will jump to market price $1200. They have A LOT of stuffs in the unit. There is no way they can just temporarily move out and move back in.

They accepted my argument and signed the lease.

@hau nguyen Here are my numbers: Purchase price : 303,000 Repairs: 2600 Closing cost: 4500 ish DP :25% Monthly PITI: 1,550 Gross rent/month: $2,325 (potentially $2600 if both units are at market rent) - still working on this. Monthly Expenses : about $300 Not great numbers, but I learned a lot.

I just wanted to say THANK YOU to all of you in BP community. I closed on a duplex last month in Sacramento. Inherited 1 tenant (a family) and managed to get them to agree on a rent increase and signed a lease with me starting September. Two weeks after closing, we filled the other unit at market rent price. Today, the first day i receive the rents in full and i feel very happy! I wouldnt say this investment has great numbers, but I think it is a good start for me. I learned a lot from BP! So, thank you again! I cant wait for my next deal (once I 'reload' my Heloc!)

Hi Kim Meredith Hampton The applicant who submitted application does not meet my requirements. I clearly stated small dog no more than 20lbs. She has a pit bull, which bothers me. Also, i told her to send me her proof of income. She never sent it either. Her co-applicant never submitted application too. Maybe I should put an Ad again. Thanks

Hi BP, So, i just closed on a duplex earlier this month. One of the unit is occupied and I managed to get the tenant agreed on rent increase. Although not by much, because of the unit's condition. Anyhow, I listed the other side on zillow and got a boat load of interest. 105 people made an appt to come during showing. Only 9 actually showed up! All 9 put their name and email in the interest list and asked for applications. I send the application link (i use cozy.co) to them. Only 1 filled out and paid $40 themselves to get me copies of credit and background check report. Should i send the others reminder to get the application in? My agent said they might be hesitant to pay $40 upfront at cozy. I was like, that does not make sense. They have to pay anyway even if it were on paper. Is it okay to send them reminder? Or am i going to look desperate to fill the unit? Thanks,