All Forum Posts by: Tyler Brown

You can definitely cash flow in the NY area.  Take a $350,00 duplex in a C area of Long Island that's 3 bed 1 bath on each side, with each side going for $2,200 a month.  20% down with a 4.6% 30 year fixed mortgage, $9,000 annual property taxes, and $2,500 insurance gives you a monthly payment of about $2,400, which is against your monthly income of $4,400.

You can use your own preferred numbers for repairs, vacancy, capex, etc... but you've still got plenty of overhead left for positive cash flow. You can spend less and get a SFH, which are more plentiful on the market, but the rental income will also be lower.

Yeah, I have a single family home in Farmingdale that rented out quickly.  I'm fairly new to LI myself, so I'm really only familiar with Nassau at the moment.

With regards to C or D neighborhoods, that references the overall quality of an area.  A really nice area with high income and very low crimes would be an A neighborhood.  An F neighborhood would be a war zone, with lots of poverty, tons of crime, gang activity, etc...

You can buy houses for dirt cheap in an F neighborhood, which is great and all, but you're very likely to get problem tenants that may damage your property and frequently need to be evicted.

I find the best values to be found in C neighborhoods or so.  Property values aren't too high, there's a lot of people looking to rent, and if you're careful with your tenant screening, there are plenty of qualified tenants.

2% can be tough to clear here in Long Island, but 1% is achievable, especially if you get a 2 family home.

Most of the opportunities like these are in C-ish neighborhoods, like Uniondale, Freeport, or Amityville.  I'm not really familiar with further out in Suffolk.  There's lots of inventory in Hempstead which I'm really tempted by, but depending on where exactly it is, you're entering more of a D neighborhood.  

There are homes for $300k-$350k that can rent for $3,000 to $3,500.  You can get a 2 family home for $350k-$400k where each side can rent for $2,000 to $2,500.

I have a two family house, with one unit given a discounted rent that's about $300 month below market rate.  In exchange, the guy in this unit acts a caretaker and general handyman for the property, and does tasks like lawn care, snow removal, and basic repair work.

Am I able to deduct this $300 from my taxes as a business expense?  My understanding is that if I charged him full rent, and simply paid him $300 every month for his services, that would be deductible, and at the end of the day, this works out to basically the same thing.

As part of Medicaid planning, we recently created an irrevocable trust and placed my mother-in-law's two homes into it.  She lives with us, and she really has little to do with the homes; I do all the day to day management and landlording.

The two houses are rented, and generate a gross of $75k a year for the trust.

In the medium term future, I'd like to purchase another rental SFH or small MFH and have it placed in the trust as well. Most info I find online relates to using an LLC to purchase a home; I'm not finding a lot on using a trust.

My wife is the trustee of the trust, but she couldn't care less about real estate, so I'll be the only one looking for/analyzing potential deals, and then doing all the work to clean it up and get tenants in there.

I guess I'll ask my most basic question first: When purchasing the new rental house, can the trust itself directly purchase it, or would my wife and I need to buy it, then transfer it into the trust at some time after the closing?

Also, when applying for a mortgage, how is the maximum amount I'd be approved for determined?  As mentioned, the trust generates $75k in gross income, but then my wife and I have our own jobs and incomes as well.  Most of the homes I'm looking at are in the $300k-$400k area, so they're likely too high for just the trust's own income of $75k to swing.

 I use the Traffic Master brand from Home Depot.  It was something like 68 cents a square foot.  It's pretty easy to install, and if you don't want to do it yourself, any handyman should be able to do it for you.  I paid a little over $500 for all the materials + a guy to do all the work replace the carpet in three bedrooms with laminate.  It'll last a long time and is easy to clean up spills.

The only issue would be if it's an upstairs unit - the downstairs neighbors will hear more sounds than they would if it was carpet.

 They sort of fell into my lap.  My mother in law recently moved in with my wife and I to help out with childcare and such, so I just finished up a bunch of work on her house in Farmingdale and got it rented out over the weekend.

My mother in law also purchased the two family in Queens back in the 80's for all of $40k, it's worth about $700k today and brings in $2750/mo in rent.  

Since she moved in with us, I placed the homes in a trust and have taken over the day to day management aspects of them.

Howdy all,

My wife and I live in Long Island (Nassau County, along the south shore), and I have two properties that I rent out - one SFH in Farmingdale, and one duplex in Queens (they're actually my mother in law's, but they're owned by a trust, and I do all the day to day management of them).

In the not too distant future, I'd like to purchase another property, and I'm looking for suggestions on areas. I'm looking to buy and hold for the long term, more concerned with cash flow as opposed to appreciation. I'm open to either MFH or SFH, but typically the numbers come out better with MFHs. C and B- neighborhoods seem to have a good combination of lower home prices, but still high rents.

At first I was looking into Hempstead, but I think that might be a bit more like a D neighborhood from people I've talked to.

Some areas I'm looking at include Freeport, Baldwin, and Uniondale.  Although I just moved to Long Island myself a few months ago, so I'm not super familiar with all areas yet and would love any input on these locations, or any others for that matter.

It's one of those things that regardless who legally may be responsible, it's probably in your best interest to pay for it so you know its getting done.

If you tell the tenants that they're responsible, they're likely to simply not do it, and be content with some bugs, then next thing you know, you have an infestation.

I use a service that's $800 for the first year, then about half that for every additional year.  Unlimited service is included, so if the tenants see a single bug, I can have them out there spraying the place.  Pretty good value, if you ask me.

My mother in law owned a SFH that was recently put into a trust. My mother in law is the grantor, my wife is the trustee, and I'm taking care of all the day to day management and landlording duties for the home.

I'm getting the home ready for tenants, and have created a lease that I'll be using.  It's a heavily edited template, and I'm just about done, although the very beginning of the lease is what I'm curious about.  The first line of the template I'm using states,

"THIS LEASE AGREEMENT is made and entered into this ___________ day of _______________, 20___, by and between [owner's name], with an address at [owner's address] (hereinafter referred to as "Landlord") and [Tenant's name] with an address at [Tenant's address] (hereinafter referred to as "Tenant").

Since it's owned by a trust, would [owner's name] simply be "The ABC Trust"?  What address would be listed?  The bank where the trust has its accounts?

I was thinking about listing something like, "The ABC Trust, with Tyler Brown acting as its primary agent and landlord of property" and putting my own personal address, but I'm interested to get other's opinions.