All Forum Posts by: Alecia Loveless

@Thomas Haessig If you haven’t done something similar I would sit down with a notebook and write out your goals.

I like to set goals for 6 months, 1 year, 3 years, 5 years, and 10 years.

You can set as many as you like but I like to pick my favorite 5-6 for each time period.

This exercise will help you establish which of the two properties best aligns with your long term goals.

If you’re looking for a quicker cash flow option then I’d focus on the 4 plex, and ultimately try to get another in the next year or so.

If your long term goals align more with the focus of building equity then I’d focus on the duplex for now and still look to get into another deal that will build equity in the next year or so.

@Rachel Seymour-Newton I like house hacking personally. I’ve done it for years. If my partner wasn’t opposed to moving every 12-15 months I’d buy a new one to hack every year.

You will need to look at your goals (and if you haven’t laid out a plan for what you want to accomplish in the next 10 years you should do so). Then determine if a long distance property is better or a local house hack.

I’d consider saving for the next few months until you’ve got 2-3 months left on your lease so you have a healthy reserve fund no matter what you decide.

@Benoy Varghese When I take over a property I send a letter to the existing tenants introducing myself and telling them where to send rent and provide the necessary information regarding my policy for dealing with maintenance issues.

For me, this means I provide them with the pertinent telephone number to contact me, the name and number of my contractor, and my email address. (My contractor often just answers these calls and makes the necessary repairs without me ever knowing). If it is a large or expensive repair he will notify me.

Obviously if you’ve done this before you likely have a method you prefer for dealing with these types of things. Just communicate this with your new tenants and you’ll be fine.

@Hector Espinosa If I was starting over today I would focus on buying two small 1-4 unit properties. Then I would immediately focus on mid sized deals. In my market that generally means 5-10 unit deals. In other words just grow faster.

When I started out I bought 6 small deals starting out. Then I started in on the mid sized ones. In general the economies of scale as associated with the larger properties just makes them easier to manage and causes them to cash flow better.

Cash flowing better might not be true in all markets.

I am an expert in the market I invest in. For this reason I do not look for OOS deals or deals that are more than an hour away from me.

If there were larger deals (10-25 units) in my market I would be focusing on those now that I’ve got 10 deals under my belt.

I recommend having a consistent growth mindset to keep building and expanding your portfolio.

@Steven Wetherill I can’t imagine your taxes are only $500 for the year. Please double check this and make sure that wasn’t the amount for the raw land prior to the build.

I’d recommend saving that $295 cash flow for some amount of time until you have considerable cash reserves saved up.

I’ve got much higher cash flow on most of my properties and it’s taken me about 3 years to save up around $10,000 in reserves per property. That’s a level I’m fairly comfortable with but your level of comfort may be more or less.

@Sidra Amir I work in a group home that regularly has a pest company come in and inspect for bed bugs with a bed bug detection dog. The handler takes the dog through each room and bedroom and the dog alerts the handler if it smells the bedbugs.

I’m sure there’s other companies that do this. It’s likely not that expensive. However it’s not something I would do regularly for my properties unless I had a real reason to suspect bed bugs.

My parents had a tenant bring in bed bug infested furniture they found on a curbside. The problem ended up being so severe the pest company had to tent the house and raise its temperature to something like 110 degrees for a few days. This is often the best treatment for those pests. The cost was about $4000. My parents passed on as much of the expense to the tenant as they could.

@Lorraine Hadden Keep paying your bills and mortgages on time and maintain a low amount of debt that is carried from month to month on your revolving types of credit accounts like credit cards.

I’ve had a solid credit score over 800 for years but recently as I’ve added more mortgages it has dropped a little bit.

I’m currently carrying some credit card debt month to month that I’m working to pay off. I suspect once I get rid of that my score will rebound some.

That being said with 10+ mortgages I think there’s only so much you can do.

@Kyle Kline I don't generate huge amounts of cash flow but when I analyze a property to buy I make sure the income will cover an allocation of usually 5-7% for CapEx, Repairs, and vacancy.

The percentage needed to be saved will be dependent upon the property, the condition it’s in, and the overall general vacancy rate of the surrounding area.

@Andy S. I’m in northern New Hampshire where we regularly get to -20 degrees during January and February. People still move during this time.

No reason to wait and eat 3 months of rent. List it as soon as it’s ready.

@Lauren Cutchen Bought a house where the sellers child had scratched his name into the stainless steel fridge door. We were able to buff it almost entirely out.