All Forum Posts by: Adam Christopher Zaleski

@Mark Caudill

Thanks for the clarification. So 34K down, 10K in renovation, 10K for 5 months of mortgage/utilities and another 6K for closing costs? I'm guessing that you had to pay at least 1 point for the hard money loan ($3400). 

All in at 60K?  

If your PITI is $1300/month and your rent is $2600/month, within 6 months of purchase that's a double home run in my book. It seems like you are going to do well with the refinance. Could you walk us through the numbers? Are you going to get any of the 60K back or does it stay in the deal. Even if it stays in the deal, it seems good to me.

I have rentals in Fort Collins, CO, Fort Myers, FL and Koloa, HI. Real estate is local. My comments are in reference to the markets that I know. I do not know all markets. 

Because inventory is so low right now and demand is so high, prices went up 20-25% over the past 12 months. I agree 100% that inventory will grow and demand will decrease. However, even with these changes, we are still going to see appreciation for the next 12 months in the 10% range. 

There is too much money in the system right now and it has to end up somewhere. 

I bought my first rental in May 2007 for 182K. If you look at national housing data, I pretty much bought at the very top. However, all real estate markets are local. Locally, this was a good deal. Now in 2022, zillow says it's worth 482K. In my personal opinion, I think it's worth 450K to 460K. 

I've been listening to people talk about this strategy since 2015. Here is a quote from a real estate podcast about 2-3 years ago, "Don't wait to buy real estate. Buy real estate and then wait." I can't remember the source.  

Any closing costs or rehab costs? Why is it a refinance? When did you buy it? Is the PITI 1700/month? How did you get an investment loan with 10% down? Are you using private money?

Eric,

I moved to Pueblo West, CO in August 2019 and I love it. I actually moved to Pueblo West from Kauai. That is how much I love it. We were a little too far from home with a 4-year old. My wife's parents live in Castle Rock (1.5 hours away). We kept our house on Kauai as a long-term rental. We stay at our house on Kauai when we are in between tenants. Now we have the best of both worlds. 

I am personally not going to buy any long-term rentals in Pueblo that falls within the district 60 school district. I apologize if this offends anyone. I'm going to be buying long term rentals in Pueblo West in school district 70. We have a 4-year old in district 70 and we are very happy with the overall educational experience.  

In a nut shell, Pueblo West is what Denver was 25-30 years ago. Affordable housing, tons of sunshine, low property taxes, low sales tax, no traffic in town and no traffic to the mountains. My biggest complaint is that we are 2 hours to DIA. However, the Colorado Springs airport has been expanding and we occasionally fly out of COS now.   

This personally frustrates me the most as a landlord. Every market is different. As a result, I don't really have specific advice, not knowing your market. You will learn from it and you will get better. 

I do 4-6 hour time blocks on Saturdays & Sundays and book individual appointments every 30 minutes. For context, during my last rental showing in Fort Myers, FL in June 2021 which is a hot market that lacks affordable housing, I filled 24 spots in 2-3 days. Of those 24 spots, I had 8 no shows. I had about 8/12 show up on each day.

Before booking an appointment let the tenants know your minimum application requirements (income, credit score, etc...). You don't need to verify anything at this point, but this prevents people from looking at the rental who you know will not qualify and meet your minimum requirements.  

I get them to commit to a specific time. After booking the appointment, I ask them if they would be willing to call, text or email at least one hour before the showing if they know they won't be able to make it. Most agree. This doesn't eliminate the "no shows" but it does decrease it. If people give an explicit commitment to something, they are "more likely" to follow through and actually do it. 

And most importantly, good luck!

I have a single family rental in Florida that I rented for $1950/month in June 2021. The fair market rent was $2050/month. Now 6 months later, the fair market rent is $2400/month. 

If you have houses that appreciate quickly, I would wait 6 months to see what the rents do before you sell them and conclude that the cash flow is poor. In my experience, rents lag housing appreciation by about 6 months. 

From 2011 to 2021, we went from zero to 1 million net worth, while averaging 90K/year of total income and 50 hours/week (25 hours/week each). 

@JDMartin 

When there was carpet, the tenants were required to clean the carpet. 

In August 2020, I negotiated with the exiting tenants that they didn't need to clean the carpets if they gave me 7 days of inconvenience for me to install LVP. They agreed. 

I also had a 500 sq. ft. area of hardwood that needed to be replaced with LVP, so it all matched. I did that over winter break last year when the house was empty. That took another 3 days. For that one, there was no inconvenience to the tenants because the house was empty.  

I haven't done any major painting for the inside of house since 2007, when I bought it. Touch-up paint when people are moving in and moving out is pretty easy. 

The LVP is a different color than the carpet, so now I'm in the process of re-painting the inside of the house to match the new flooring. I will do 90% of the painting over winter break when the house is empty. I will do the remaining 10% when they move out. 

I teach college. I don't teach at the same college, but the academic calendar is pretty much the same. When the house is empty, I typically have free time. 

This strategy is pretty unconventional and that is part of the reason why I like it. I typically have a really good relationship with my tenants. When I do show up to make repairs, the small talk is usually pretty fun and its common for them to offer me beer. The students really appreciate it when the owner does the repairs and not a handyman or management company. They feel like I care about them more and I think that I do.