All Forum Posts by: Tosin Oluwatoye

I am also interested in this idea. I have a piece of land behind an existing rental that is almost 1.5 times the size of the standing triplex. 

I would be following up with the municipality to confirm if zoning permits this. The tiny houses would be so much cheaper than new builds but will like to know the average lifespan of a tiny house. Also does any one have leads on companies that build such houses in the Philadelphia tri-state area?

Thanks

Thanks everyone. Very helpful hints. 

Thanks @Jaysen Medhurst. I plugged in some details and no program/ terms were returned. If you don't mind, I can DM you. 

Thanks

Hello BP Family,

Wondering if anyone has leads on lenders in the PA/ Delaware county area who would ReFi a rental property under $100k. I have done some research and those I found need the 80% LTV to be a minimum of $100k.

Just BRR'd [now on the 4th R :-) ] a duplex with an ARV estimate of $90k. This is my estimate using comps from the MLS with some slight adjustments and would like to refinance at this point.

Any lead is appreciated. Thanking you guys in advance. 

Thanks @Nathan Gesner I like the multiple perspectives. I'm currently gathering information on the area to determine how landlords typically price out (with/w-out utilities included). I will also check if the landlord is already taking advantage of having a singular energy account. That said, I believe reducing the rent by an amount that puts the rentals closer to the market is probably a better option. The current utilities expenses far outweighs the additional revenue being realized. 

I will certainly post my eventual decision and lessons learned 

@John LaBanca Thanks for your suggestion. The rents are already significantly higher than the neighborhood average due to this tenant side benefit and I want to be able to predict my income fairly more accurately while reducing the risk & and associated stress. 

Increasing the rent could provide some cushioning, however tenants can get +1 room on the market at the new price point and will most likely end up moving.  Also, it does not insulate me from the risk of having an insane energy bill because 3 of the tenants had bad mooods all month long and paid no attention to regulating their energy consumption. 

I am currently considering a 10 unit (5 duplexes) purchase where the current landlord is responsible for all utility bills and does not have a cap on usage written into any of the leases.  Fortunately all 10 units have month to month leases and the deal will most likely close going into the winter months ( I am assuming this is an advantage) 

In my Analysis, I have found that If I reduce rent to the same amount across all units & transfer the gas&electric utilities to the tenants while landlord is still responsible for water & sewer ( win-win), I can increase the CoC ROI by 11%. To get to the details, annually, I will lose about $5,760 on the top line but save $14k+ on expenses and increase cash flow by $7.8k+.

I would prefer to implement this on day 1 though I understand such changes could be a tricky dance with tenants who have gotten used to status quo. 

I am wondering if anyone in the BP community has had a similar situation and has a few helpful nuggets to share.

Thanks 

This is an old post, however I believe the devil is in the detail and if the deal is great enough, one may want to consider going ahead. In the past I have analyzed such properties and found that you are in a better position to reduce rent - yes, reduce and transfer utilities to the tenants (average of a 10-14%) increase in cash on cash ROI.

The easiest scenario for this will be where leases are month to month and property is in an area with  high rental demand.  

I typically don't advocate paying utilities but in the Philadelphia/Delaware county market, most landlords are responsible for water. 

@Sudhir N. Can you confirm costs (if any ) associated with acquiring these licenses?

Also do you know of any hidden got ya fees /licenses Philadelphia may be charging landlords?

Anyone?

Thanks