ADVICE FOR NEW HOUSE HACKER/ PROPERTY INVESTOR?

Question

Good morning biggerpockets members, I am closing on my first rental property next week. This property is a duplex, that I will be house hacking. The property is currently occupied. I will be presenting a 30 day notice that weekend. I purchased my Leases and noticed from bigger pockets so I have those ready to go. Any advice you would give to someone purchasing their first investment property? Thank you in advance for your time!

Juan Erick Rico Avalos · Answer

@Daniel Hyman thanks for your insight. My issue right now is finding a CPA that has this kind of experience. How would you recommended would be the best way to find a good CPA? Mainly by word of mouth?

Juan Erick Rico Avalos · Answer

@Ben Scott One tenant is month to month. The other tenant’s lease expires January 30. I am giving the 30 day notice this month to the tenant still under lease just letting them know their lease will not renew. I plan on having the month to month tenant stay until I have the other unit updated. After that I will rent out the updated unit at market rent and move into the other unit. Both units have had long term tenants 15 and 20 years so they need updating.

Carini Rochester · Answer

I 100% agree with Grace. I skimped (skipped) on this on my first tenant and I regretted it for 3 years. I learned some lessons and now I put extra effort into selecting good tenants.

Also, start looking for your second property!

Grace Wang · Answer

@Juan Erick Rico Avalos You can use any online property management software, collect a check, use Venmo/Zelle/etc. It's whatever is easiest for you and your tenant

Daniel Hyman · Answer

@Juan Erick Rico Avalos

There are some great ones here on the BP forums that work exclusively with investors. Reach out to one and see if they are still taking on new clients for the upcoming tax season.

Juan Erick Rico Avalos · Answer

@Shane Ryan thanks for your insight. The reason one tenant has to go is because my financing is owner occupied financing. I am having the other tenant move out as well after the winter (I live in Nebraska) because the tenant mentions they can’t afford more on rent. Their current rent is 575 while marker rents are 900-1100. I understand that it would be unfair to charge them that since they’re unit isn’t renovated, but I can’t afford to have them live in this unit for that rent price. The renovation wouldn’t be drastic either, it would mainly be flooring, paint, new bathroom sink/cabinetry and bathroom reglazing.

Daniel Hyman · Answer

@Juan Erick Rico Avalos

My advice would be to keep your documents organized. Tax season will be upon us shortly, and a house-hack adds complexity to your tax return that you did not have previously. Being organized with your documents and bookkeeping will go a long way to smoothen out a potentially bumpy tax season.

Shane Ryan · Answer

@Juan Erick Rico Avalos 15-20 year tenants that you are evicting? Is your plan to renovate and raise rental prices? Or are you just looking to start fresh with new tenants and upgraded units? I'm not in your situation nor have I been but my 2 cents. If I bought a property for a rental that had long term tenants. I'd keep the tenants. A tenant that has that long of a history in the same place would just make your life that much easier. But I'm a busy person. I'd rather not make the extra $1000-2000 a year knowing that it wasn't going to cost me more in the long run. I bill for $100 an hour with my current business. If I had to pull off a job for a day or 2 to deal with a tenant over something simple then it would cost me money to have not kept the old faithful tenants in place.

My comment may be completely ludacris(and I apologize if it is) but it may be something to really think about. Peace of mind in some situations is priceless.

Juan Erick Rico Avalos · Answer

@Ben Scott Thankfully my lender will give me 60 days from closing date to move into my unit.

Ben Scott · Answer

Congrats @Juan Erick Rico Avalos on the investment. Question: does the other tenant have a lease in place? Or is that tenant month to month? If there is a lease in place you most likely will have to honor that contract.

ADVICE FOR NEW HOUSE HACKER/ PROPERTY INVESTOR?

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