All Forum Posts by: Walter Key

Welcome aboard! Best of luck to you in 2016 and beyond.

Welcome. I was out in the Ft. Bragg area not too long ago. Very nice area. Best of luck to you!

Welcome aboard!

@Tim Puffer In that case it sounds like you've got a pretty good plan in place. Dan brings up a great point on mowing and snow removal. I'd imagine snow removal would certainly be a factor in Michigan so just have that plan laid out before you proceed, whichever way you decide to attack it.

I don't have any experience with Fannie but I've heard they can be a little more of a pain to deal with. But, if the numbers are right and you like the deal I wouldn't be deterred by a little extra paperwork and processing time. Best of luck to you!

@Chris Sukala So it sounds like option three is by far the least lucrative deal. Listen, I'm married too...I fully understand the realities of "Happy Wife, Happy Life." But, I'm willing to bet your wife is a very smart woman (I mean, she married you after all, right?). Once you explain those profit margins to her, she probably won't like option three much anymore. 

So, that leaves you with option 1 and 2. Option two looks like it needs a bit more Due Diligence. If you're going to hire out the mowing and plowing, you really need to get some quotes and factor that into your bottom line. It may eat away allot more of your profit than you think.

As for taxes, don't sweat that. Are you or your wife pretty savvy with taxes? Have you filed your own taxes in the past? My wife files ours online herself, despite having multiple properties on the books. She pays for the higher end tax software to ensure all our business expenses are accounted for but we've never taken a loss come April. We're a family of 5 with the kiddos ranging from 2 Y/O to almost 13 Y/O. I will give a word of caution though, if you're not comfortable doing your own taxes, don't hesitate to take them to a professional and pay the extra money they'll charge you to ensure they're done right. There are some things money CAN buy. Peace of mind is often one of them.

This is great advise. The only thing I'll add is use this site for all the great resources it offers in building up your education for free. Read the blogs, listen to the podcasts, read some of the project diaries to see what other successful investors are doing. Best of luck to you!

Management cost is typically 10% and a better vacancy rate would be 8-10% of monthly rent. Of course, if you've found a company that will properly manage your investment for you for only 5%, more power to you. I personally only pay 6% on a couple of my rentals so it's not impossible. 

You mentioned paint, carpets, kitchen hardware and appliances that need attention. Are you planning on reducing your asking price to account for the estimated costs? I didn't see any up front repair expenses listed in your analysis. 

Tyler,

The price is $24K and the CURRENT value is $70K or the ARV is $70K? Do you have $24K in cash or access to a funding source to acquire the $24K without bank financing?

Dan,

Do some research on Omaha, NE and the surrounding areas including Bellevue, La Vista, Ralston and Papillion. I think you may like what you find in the area. 

Chris,

Have you ran an analysis on each of these to see how the numbers play out for each? For the first option you mentioned, you have two other rentals in the area so...how are those performing for you? Is the area and your rentals there conducive to your investing goals? Also, do you use a property manager for those two properties? If so, how are they working out for you? Will they offer you a discounted management fee if you bring another property to the table for them to manage? I'm sure you noticed that I didn't actual give my opinion on your question. Hopefully this "food for thought" will help you come to the right decision for you and your wife.