All Forum Posts by: Adam Feick

@Ryan Alexander

The current storage space is a little over 3,800 sq.ft.  The curb appeal is good, everything appears to be in good condition.  It is the main storage location in the town.  The downside is the size of the town is about 2,500 population.  

@Kevin 

@Kevin Bledsoe

I don't plan on managing myself, it is about 1.5 hours away.  I have a property manager in the area and I have been heavily looking into the different self storage software companies and management services.

I am looking at a small self storage facility.  Here is the information I know.

2 buildings, 46 units total.  Fenced in with automatic gate.  Space for another building (about 24 units) and RV/boat storage 10~15 spaces.  

Asking price $185,000

Current potential gross rent $1,930 (mo), actual gross rent $1,320 (mo).  Just recently have occupancy at 80%, but it is not reflected in their income yet.  The current rental rates are near market rent little upside.  

Expenses:  Taxes $100/mo, Electric $60/mo.

The current owner self manages and has it mixed in with other investment properties.  Their records are terrible and they can't tell me how much in maintenance, insurance, lawn care, etc. that they have.  Only taxes and electric.  

My assumed monthly expenses at the sellers price:

Taxes $170, Insurance $70, maintenance $70, management/software $110, lawncare $75, misc $50.  

This puts the Cap-rate sub 5%.  For the area cap rates are selling around a 7%.  

Can anyone tell me are my assumed expenses out of line?  

What other expenses should I be thinking about?

Thanks in advance!

There is a Dayton REI Meetup, postponed due to COVID, but still meets online. There are many people in the group investing north of Dayton. You can find them on Facebook and they will happily share a lot of the information you are looking for. Good luck!

Congratulations on your latest property. 

Welcome to BP.  Tons of information to devour and learn from.  I visit the Cape every year, Falmouth area, where my family has a home that we short term rental.  Best of luck to you.

Welcome to BP.  You'll find lots of support here in the Columbus area.  Don't hesitate to ask questions.  Everyone here is very helpful.

@Mary K.

First consult a legal professional, as this is only my opinion.  If you run a search on BP I remember seeing past threads about this subject.  

The Ohio Revised Code you are asking about is 5321.16 Procedures for security deposits.  You can Google it to read the entire thing, however you are asking about Section A. It reads:

"A) Any security deposit in excess of fifty dollars or one month's periodic rent, whichever is greater, shall bear interest on the excess at the rate of five per cent per annum if the tenant remains in possession of the premises for six months or more, and shall be computed and paid annually by the landlord to the tenant."

I read it as if the security deposit is greater than one months rent, then you owe 5% interest on the amount greater than one months rent.  So if rent were $100/mo and the security deposit was $110.  Then you owe the tenant 5% on the $10.  

Hope this helps.  Please consult a legal professional.

@Alan M. 

First let me sorry for your loss.  Second, congratulations on being in solid financial situation without the inheritance.  As you said their is no one "right" answer so I'll add my thoughts based on experiences below.

Points to consider first...

- You are planning on retiring in 12 years.  From a life stand point it's not really that far away, I am also 40 years old, and life is going incredibly fast.  I try to enjoy my family as much as possible now, while balancing long term saving/investing for the future.  

- You are living below your means so the inheritance ,I'll assume, is between 8x~16X your yearly expenses.  Typically people in the "FIRE" community value time and flexibility/freedom very highly.  This inheritance can "buy" you more time.  If you paid off your primary residence and/or the rental property what would this do to your living expenses?  Could you retire earlier?  The emotional side of being debt free is pretty remarkable.  You mentioned paying cash for cars, so I get the feeling this could be important to you.

- You have about a years worth of pay that's liquid (15% x 8X yearly pay total inheritance).  If you invest in the stock market and then find a real estate deal to invest in, prior to selling the brownstone, then pulling the money out in less than a year would trigger short term capital gains/losses.

- Have you considered a DAF (donor advised fund).  You could make a large contribution this year or next and enjoy the tax benefits while allowing the investments to grow for charitable giving in the future. 

- Keeping the brownstone.  Not sure what part of Boston it is located in, but does it make sense as a short term or long term rental?  Being fully paid off, it may.  My family has a paid for vacation rental in Cap Cod.  We use it for a vacation every year and then short term renters fill the other ~11 months.  

Beyond these points, your thoughts of diversifying the money into different investments is the correct thing to do.  I think if you are comfortable with the risks of the different investments, then it makes sense for you.

Good luck and congratulations.

@Erick A Nelson I am in Marysville. How about you?  

@Adam Fansler  I would gladly be part of an accountability group. I think it would definitely motivate me to be more actionable throughout the week. I struggle with making the time for needed phone calls, etc. due to being focused on my W2 job. 

Let’s schedule a meeting/phone call/coffee soon.