All Forum Posts by: Vasudev Kirs

Set parameters early on. Create a rough list of what you will respond to right away, and what can wait. Response time should be reasonable, but not immediate. Train the tenants to understand that you have a life as well, or else you be taking on another job.

The biggest one... Limit the DIY. find a way to transition it to contractors/handyman. You can still self manage, but repairs should be hired out if possible. I did a lot of work myself earlier on... I mean just about EVERYTHING, minus brazing in new copper lines. It was not worth my time. DIY, but don't DE(verything)Y.

I made many mistakes early on. I got to know tenants and was way to accommodating. I responded to things that I could have made them wait until it was convenient for me. I did not have standards to hold them to. These are all lessons learned early on.

Create standard templates early so you save time when similar issues repeat themselves. Rehearse your approach and conversation so you know when to guide the conversation to a predictable outcome.

Great suggestions! I am interested more about:

1. Setting parameters (i.e., what will be responded immediately, what can wait.) Do you have any examples? Did you include them in your lease?

2. Standard templates. Could you please elaborate?

I will be closing my very first property next week so looking forward to all the suggestions and pointers I can get!

1 Vote

Hello:

I am not sure what interest rate to use while calculating cash flow. Is there a standard formula that takes into account the fluctuations of interest rates?

Here are the details at a high level:

Purchase price: 174,000
Closing costs: 2,000
Down payment: 20%

Rental income: 1525
Monthly expenses: 487 (insurance + tax)
Maintenance: 128 (1% of purchase price)
10% vacancy: 150
Self-managing

I am not sure what interest rate to use to get the monthly mortgage amount. I have excellent credit score (above 770 and no other mortgages). Can someone please help me?

Thanks!

0 Votes

Quote from @Aniket Patkar:

Hello there!

New member here. I wanted to get experienced opinions on our situation. My wife and I currently own a house in Royal Oak, Michigan (Metro Detroit). we have decent equity in the house as we bought it in 2017 and have 2.65% mortgage rate.

Our main plan is to get a bigger house in near future (4-5 years) and keep this house as a rental property. We also have good enough cash put aside for a %20 down payment. We are not going for the house right now as the market is inflated and the interest rates are much higher.

We are thinking about buying a smaller property using that cash for rental investment in the mean time. Planning to buy it now, rent it out for 4-5 years and sell it when its time to buy the bigger house.

Do you think its financially wise to go through this process before the big house purchase? or Do you think its too much of a hassle and not enough profit margins for a property to give net positive gains and possible house appreciation? Since we are total amateurs, we don't which way is better (either get a property for short term or invest that extra cash .

Any help will be appreciated! thank you.

I am also a newbie but here are my two cents:

1. i agree house prices are inflated but dont wait for interest rates to come down. if they do come down, there will be competition.

2. go for your investment property asap but dont buy it by all cash. go for mortgage instead. when interest rates come down you can refinance.

am late to the game and realized only few months ago that parking money in the bank is not a wise decision.

1 Vote

Detroit, Michigan

thank you for great suggestions, Jonathan.

are there any web solutions or systems out there to collect rental payments? What do you recommend?

1 Vote

Hello:

Could someone please confirm? I am planning on closing an investment property `all cash` under an LLC name. I am planning to buy a 4bd 3ba house as a primary residence and will be applying for a pre-approval soon.

When I was talking to a lender today, he mentioned that if closing a property on LLC has no leverage or adds value to pre-approval. Infact, I would have to show tax returns on LLC for two years before I can include it in pre-approval. I am trying to get a pre-approval with higher limit and want to use the investment property I am buying to give me a better pre-approval.

Could someone please share thoughts?

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Why is everyone pointing to Ohio?

1 Vote

San Francisco, California

Quote from @Jack Seiden:

Quote from @Jay Hinrichs:

Quote from @Jack Seiden:

Quote from @Joe S.:

Quote from @Jack Seiden:

Quote from @Joe S.:

Quote from @Joseph Bui:

Quote from @Nicholas L.:

@Joseph Bui

I have to ask... are you really 'rehabbing' for 15K?? In Pittsburgh, similarly, you can absolutely buy properties in solid neighborhoods for 50-75K. But you're not boosting the value enough to rent them for $1200 with 15K. =)

Rehabs are from 15-30k normally. I work with a team that helps with me end to end as I'm normally located in Seattle. They source deals, project manage the rehab and do property management as well. Yes, the average rent is about 1200-1300/month with a rehabbed 3 bed 1 bath 1000 sqft property.

How are you financing these properties since their lower price properties?

These must be extremely light rehabs, I’m doing what I would consider a very light rehab, with honestly maybe a minor step up from builder grade, 1200 sf, 1 bath house, materials alone are 25k

Are you putting a long-term rental loan on these properties after you get them stabilized and if so, how are you getting the financing for such a small amount?

It’s a flip, self financed through a loc, 220pp 60k rehab, will sell out between 400-450k.

those are spectacular spreads at those price points.

Thanks! And tbf this was kind of a deal for a number of reasons I kind of got lucky on, the agent had it coming soon, I was going away, should wouldn’t let me see it early since that was an mls violation so she just listed a week early on a Tuesday, 9 offers in 24 hours, than pulled I was the highest cash offer and got it, think listed properly they probably could have gotten 250-260k. All that said one of the things like about these smaller markets, is just less overall competition and the ability to kind of set your own comps, while it hasn’t sold yet so I could be wrong, it was hard to comp tbh, but this town (about 1.5 hours from dc) is growing rapidly, my parents bought a house for 350k in 2019 now worth 600k. So I just felt that even without comps I kind of knew under 400k downtown Easton, I can easily sell, as opposed to like dc or suburban Md where there are a million comps and tons of info these rural market’s with lack of comps and info you can kind of set your own market if you understand the area.

Are you going to pay by all cash? Is not that against the real estate investing rules :)

0 Votes

Quote from @Jonathan Greene:

I like condos for first investments (as long as the numbers are ok). They are safe in terms of HOA taking care of exterior, roofs, driveways, snow removal, etc. But, the thing you really want to focus on as a first-time condo investor is the strength of the HOA and whether or not they have any pending assessments or litigation which is the condo killer. HOA cost vs. amenities does scale to rent so it has to work.

@Jonathan Greene could you please elaborate on -- strength of the HOA?

@Rabia Khan leverage buyers agent experience. look for HOA cash reserves, check how old or recent HVAC is, kitchen appliances etc. the more recent and updated they are, the better it is for you as you dont have to invest in maintenance or capital expenditures.

1 Vote

Houston, Texas

I am a newbie who is beginning his RE journey and learning the ropes and tricks of the trade at the same time. I noticed that CDs are giving me better interest than the cashflow I would get from a $100k rental property. I have been trying to find decent deals in the market but no luck so far.

Whatever deals I could find are being swooped up by out of state investors or being outbid with people going for 20k over asking price. I really dont get how they are able to find it an enticing deal with 20k over asking price.

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@Joe Villeneuve Thank you for your reply. How can I access your CF tools - are they free? I own two condos which are completely paid off and I have an obligation to buy a single family house very soon for our family. My question for you is, is it a wise decision to take a mortgage loan on those two condos so that I can purchase a new investment property (in addition to single family house which is an obligation) using DP approach?

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All Forum Posts by: Vasudev Kirs

Vasudev Kirs has started 24 posts and replied 79 times.

Post: What is the hardest part of DIY management?

Post: Question about cash flow calculation

Post: Buying a rental investment property for short-term purposes

Post: 4 Tips for Landlords - Which of these are you using and which are you going to use?

Post: LLC on existing property and future pre-approval

Post: New Investor - Looking for BRRRRs (Anywhere in U.S.A)

Post: Are the GREAT Deals Gone?

Post: First investment property

Post: Are the GREAT Deals Gone?

Post: Needing input on how best to use my cash