Buying a fixer upper & renting my old house

Buying a fixer upper & renting my old house

Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
So my wife and I found a off market house built in the 60s with about 1800 sf. Most comps in the area are around 140-150 and I think we can buy it for around 60-75k. It’s a solid house and just needs freshened up. It’s in a great school district (main reason we’re moving) and is about a mile from a lake with a state park. Our plan is to fix it up and build equity in that house. So we have a house that we got a great deal on when we got married 5 years ago. Houses around the same size are selling for 50-80 and were owned by older folks so they could use updating. Our house has been updated over the years of living there(all new paint, re did bathroom, granite counters, new carpet) so my question is do we try and sell at a higher mark and cash in on our house and put some in to the new house to build equity and reinvest to a rental or do we keep our old house as a rental, which would be the nicest rental in the area? The house we have now is again in a area with older folks mainly but over the last couple years we have noticed some younger families moving in. Thanks for the help again!
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Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
8y
Actually, yes. My father flipped a house, and I'm buying it from him. He added my name to the title in February, and after 6 months, Huntington Bank said they'll give me a HELOC which I'll use to buy him out. Then I'll pay back the HELOC as opposed to paying a traditional mortgage. It already has a tenant with a 2-year lease. Very exciting stuff!
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  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    My gut instinct says keep the current home and rent it out, but you could always have it appraised and see what you could get for it. 

  • Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
    8y
    Thanks Nicole. I have thought about getting it appraised as well. Might try that. I would like to do a HELOC to fund the Reno at the other house if possible to build equity in that house as well. Do you know anything about HELOC’s?
  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y
    Actually, yes. My father flipped a house, and I'm buying it from him. He added my name to the title in February, and after 6 months, Huntington Bank said they'll give me a HELOC which I'll use to buy him out. Then I'll pay back the HELOC as opposed to paying a traditional mortgage. It already has a tenant with a 2-year lease. Very exciting stuff!
  • Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
    8y
    That’s great! How fast are you finding good tenants when you have a vacancy?
  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    VERY. We're in a pretty solid upper-C level neighborhood. We gave the house a few nice updates like new stainless-steel appliances and a washer/dryer, amenities which are not common in that neighborhood. We had tons of interest from small families and young professionals because of the size of the home, freeway access, and proximity to the local university and hospital. Our current tenant is a nurse who is also a single parent. We have a 2-year lease and it rented out well above market. 

  • Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
    8y
    @nicole heasley is this near north side hospital? Trying to compare your neighborhood to mine. I think my area is a smaller and less attractive area compared to yours from what it sounds like. However about 15 mins away we have that massive power plant under construction in Lordstown so I’m wondering if that will draw more people into the surrounding areas and help me out. Sorry I’m kind of all over the place Im just trying to soak up as much as I can and pick your brain some.
  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    I didn't notice you were from Warren. Hello neighbor! This is in Struthers, OH. Close to Northside, St. E's, and YSU. 

  • Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
    8y
    Okay, I’m not too familiar with struthers. I did go to YSU for a little bit and lived in Girard for awhile so I know that area somewhat. How’s your way doing as far as new businesses being built or coming to your area?
  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    Better than I've ever seen. The Covelli Center has truly brought new life to Youngstown, a gorgeous new Hilton was built nearby, and they've recently broken ground on an outdoor amphitheater. I'd say this is the best it's ever been in my lifetime.  

  • Contractor · Warren, OH · Member since 2015 · 147 posts · 55 votes
    8y
    That’s great, with that being said are you finding it hard to find good deals?
  • Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    Not sure about that yet. The first deal was owned by a friend of my dad's, so that one kind of fell into his lap. Until we get the HELOC finished, we can't move forward onto the next deal. The waiting sucks.

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