All Forum Posts by: Anthony Thompson

Hi @Dylan Fraembs and welcome to Bigger Pockets and real estate investing!

If you're willing and able, I do recommend the "house hacking" strategy which is just a fancy name for buying a rental property and living in one of the units, because you'll get very favorable financing - an owner-occupied fixed-rate 30-year mortgage.

I'd also say, analyze that property as if you won't live there and it's a pure rental, and make sure the property is still cash flow positive if there's a tenant in your unit because then you'll know if it's actually a good investment.

And when you analyze it, include payment of a property manager in your #s because if you don't, and doing so would make it go cash flow negative, then you've just bought yourself a job because you literally can't step away from managing it without losing money.

Hi @Jasmine Thermitus welcome to Bigger Pockets and congratulations on getting started on your real estate journey!

If you are able to manage it yourself, I think you will get a lot of very helpful education in real estate by spending a least a year or two doing that.

You'll be able to work with property managers a lot better if you've done the work yourself for a bit, and it also helps to get familiar with the various laws and regulations you have to comply with as the owner, even if you do have a property manager in place (e.g., the new RI rental registry and associated lead paint inspections/certificates).

It's up to you whether you're able to do it, but I think you'll get a lot out of the experience if you can try it for a year or two.

Hey @Aaron Gordon congratulations on getting started on your real estate journey here in RI.

Starting off with a 
live-in remodel is definitely a way to fast track your real estate experience. Sounds like you're taking advantage of your favorable VA loan options smartly too.

Good work - can't wait to hear about your next deal!

Hi @Tim Holt I think in general house hacking is usually a good move because it gets you off the sidelines and into the game with the most favorable financing possible (30 year fixed).

There's a lot of value in getting started today vs waiting some undefined number of years until conditions are better, which could be a long time from now, because real estate is a business and the sooner you start actually learning about that business, the better.

With all that said, I always recommend that people analyze any potential house hack as a pure investment that they aren't going to live in, because someday they may want to move out and you should know up front (before you commit) whether you're going to be able to do that, or whether you're overpaying and will be stuck in the property unable to move out because it'll be cash flow negative if you do.

So you had it exactly right when you wrote, "the property would need to cash flow when I move out and rent out all units."

The only way to answer that in general (whether house hacking in today's market is still a good option) or for a particular property, is to learn how to run the numbers and analyze a specific property to see whether it will be able to stand on its own as an investment when you move out someday.

There are a lot of resources here on BP for doing that but I'd just say, make sure the assumptions you're putting into your spreadsheet or deal analyzer are realistic.

Make sure the rents (especially for vacant units or pro-forma #s) are realistic by doing your own rent comps; make sure the mortgage rate is realistic by doing some research online and/or talking to some mortgage folks; make sure insurance #s are realistic by getting a couple of quotes for the # of units and zip code / area you're looking in; etc.

I hope that helps, and good luck 😊

@Donte Brame were you ever able to connect with the RI Real Estate Investor group?

I didn't see a way to upload a file to a forum post, so if anyone would benefit from a walk-through guide to submitting property/unit & lead paint info to the new registry, you can view it at https://ripropinfo.com/RI_Rental_Registry_Lead_Paint_Certificate_Registration_-_Unofficial_How-To_Guide.pdf

Hi folks, this has been all over the news and social media so I hope it's not a surprise to anyone but I just wanted to cover all the bases.

Due to legislation spearheaded by the RI attorney general earlier this year, there is a new RI rental registry in place that requires all rental unit owners (even short term rentals) to register every rental property and rental unit in the state of RI, by October 1, 2024.

The website is www.rentalregistry.ri.gov and you will also need to upload a current lead certificate ("Certificate of Lead Conformance") for each rental unit.

The demand is so high that lead inspectors are currently booked out into November and December, so I hope you already have lead paint certs for all your units. If not, well you know the old saying, "the best time to get a lead paint certificate for your units was last year; the second best time is now".

I've been told that the RI DOH may not start hitting people with fines for failure to register on October 1 as the law allows them to, due to the insufficient # of inspectors in the state to meet the demand.

However, I've also been told that the other part of the law, the one that makes it so you cannot file for an eviction in RI without a current lead paint certificate, is expected to take effect sharply on October 1st.

For anyone who hasn't submitted their properties/units to the new registry, I have a 15-page guide (with screenshots) that walks you through it. I'll try to post it here but it's 2MB so might not work. Happy to send it directly if someone wants to DM me.

The guide is unattributed and has no promotional content other than on the last page there is a brief mention of the RI Coalition of Housing Providers (a landlord advocacy group which tried to work with the legislature to mitigate the challenge of this new law) and RI Real Estate Investors Group (a networking and education group that has educated RI landlords on new laws like this since 2003).

Hopefully everyone reading this is already aware of this new law and has already submitted their info to the new registry!

Hi @Patrick Feeley I’ve been investing in RI since 2003. Haven’t bought anything in the last couple of years, but I have a 1031 exchange coming up in the next month that’s gonna force me into this crazy market 🤪 Congratulations on finishing up your rebuild, and always happy to connect 😊

Hi @Tyler Daly you might want to check out the RI Short Term Rental Association at ristra.org

Hi @Ellen Feiss I agree with @Ty Coutts that you should start with informal, friendly, face-to-face conversations with the tenants to establish rapport, especially as you have some lead time here before next April.

People don't like surprises or having to scramble, so if you are able to let them know your plans in advance, if they are reasonable people they should appreciate the extra lead time.

This is especially true if their rents are currently very under market - they will have sticker shock when they look at what other units are renting for, and have to spend more time finding a new unit (if you'll be asking them to leave).

If you have to move into one of the units yourself, I'm surprised you (or your lender) didn't make it a condition of the purchase and make the seller have the unit vacant for you.

Sooner or later in rental real estate, you will have to establish a relationship with an eviction attorney. And if you have a sense that one of the tenants could be challenging/unpleasant, I'd recommend consulting with that attorney to make sure you follow the correct process for providing the notice of termination etc. If you anticipate a possible fight, it's best to do things properly from the start.

Certified mail in itself is not a panacea, in fact IIRC most of the relevant statutes say first class (i.e., "regular") mail - but it has to be sent under certain timelines. That's why it's better to establish a relationship with an eviction attorney now, especially if you anticipate a possible battle with one of the tenants down the line.

It's certainly good that you're asking these questions now. So yes, I'd say the first step is to informally talk with the tenants face to face and get a sense of who will be cooperative and who could be difficult, and let that inform your strategy for each of them going forward.