All Forum Posts by: Andrea Hauserman

I need a referral for someone who can help with an extensive repair on a CLE Heights home with water damage to the plaster walls. Looks like they have a fabric covering over plaster that is sagging due to a plumbing leak. I'm no plaster expert but If I was guessing the choice will be between taking the walls down and hanging drywall, or maybe skimming over the plaster after removing the fabric covering. In any case, do any of you have a referral? Thanks much. Andrea

my understanding has been same as Natalie and Andrew's comments. Immediate thought   is what are the closing costs and terms on a reverse mortgage compared to conventional. I've heard people are critical of reverse morts as being semi-predatory lending, although legal.  Never looked at it. Discussing re-fi Ive been asked to show cash flow history. I think it also matters to lenders that you have experience doing this. 

Depending on your long term financing objectives you could also think about HELOC which is a cheap ready source of cash but won't let you borrow as much and will have variable but cheap rates, or collateral based loan which may have higher rates and short terms. Depends on whether you wanted cash flow, or keep taxes down and let tenants pay Mort along tax benefits of higher expense and depreciation - but in that scenario your cash flow is minimized. I will not pay points and I seek to minimize the side costs of financing as it is a drag on returns. I finance for the longest period possible at the lowest rate to reduce my monthly obligations, then I usually pay off early.

I model these scenarios against the worst situation i can imagine in the future and try to pick a middle ground. A mentor of mine says "When in doubt, do half". If we had an event and I needed cash, houses are not liquid and I could lose big time dumping them, so that instructs me not to lever to the hilt. Owning outright can invite lawsuits so if I own outright I need other protections like an umbrella policy or LLC owning LLC. Owning outright gives max cash flow but also subject to ordinary income tax so have to keep tax rate forefront in mind because who cares about gross cash flow, all that's matters is net.

If you model your scenarios with you working/ not working for other income you eventually will start to get some clarity about where rentals or flips fit in your financial life and lifestyle.

If you have cash guard it, it can be dripped away very easily. Fiscal responsibility is really tough when you get into investments that could require unpredictable and unending cash infusions.  I like what Bob Collett said about what kind of returns most people actually are getting and suspect he is very correct. Glad he put that out there.

Hey Brad that's great info- thank you!

James Wise - where are you getting an attached garage rebuilt for $10-12k? Just curious. I want to rebuild a detached garage on a property in Kent and the city is telling me i have to stay exactly on the same small footprint as the existing structure - which would be grandfathered - if I get off the footprint I would no longer meet modern zoning requirements for set back. Similarly for another rental, the garage foundation is there but the structure was torn down long ago and they just set a shed on it.  I got a couple high quotes and stopped looking till I could pay for it out of rents.

Do you know anybody who can put up a garage using the Carter Lumber kits - fast and cheap?

Can anyone recommend a good, quick house cleaning service for a house in Solon?

Also I need a yard clean up - leaves, branches etc. also in Solon

Thanks, 

If I'm not that familiar with a neighborhood I look at a registered sex offenders website and for lots of extraneous info - city-data.com.  I have a theory that I was a good tenant that didn't destroy anything and I aim to have " me " as my tenants so I should be looking to own a place I might have rented for myself at various ages and stages. 

I've been tempted to go into Youngstown but have been warned off through similar comments as others have expressed here.  Much like the older neighborhoods of Cleveland, the declining  population ( because of steel, automotive and other manufacturing leaving the area) created a situation where there are more houses than demand and many properties don't receive the maintenance needed to keep up. The hey-day of NE Ohio was the early 1900's and a lot of our housing stock was built between 1900-1955.  Downtown Youngstown is rough and with all respect, not a place you'd want to run out of gas if you know what I mean.  The immediate areas around Youngstown State and the hospital are better but they both have large security forces.

That said, Boardman is known to be a decent place to live and invest in the Youngstown area and if the right deal came up I think I'd be interested. I use a property manager for my places in Kent. He and his wife are from Youngstown and are slowly buying rentals for themselves. I would consider him hands-on and knowledgeable. PM me and I'll refer you.

Is it in a neighborhood Where you can attract a non-family? 

Are you planning to own more properties so you aren't dependent on this one? 2 BR to me is single prof w home office, married with guest room, single parent with 1 child, young couple with baby. Speaking as someone who represented some of those demographics as a renter, half of those need a tub, the others might not care. You could always put it up for rent and ask people as they come through whether a tub is a must as your own personal survey. Although you'd hate to take it out of circulation in the future to do the rehab, maybe wait and earn some cash flow to pay for it if needed. Similar situation for me in my first BRRR - a truly humbling situation - taught me a lot about what I look for going forward. Also, everything will sell at a price. Make your price attractive for what you have to offer and it's going to rent. Then do a cost- benefit analysis on the tub payback period and what you think you could raise the rent by.

My guess is you can increase the potential tenant pool with a tub in a 2 BR house, but it's not clear that a tub will allow you to raise the rent. In a 3 BR it would be a no-brainer but not here. Perfection is the enemy of Good Enough!! 

Fix and flips in the east suburbs and Geauga seem more fully priced compared to last year, at least on asking price basis. If you follow the distressed properties you see that buyers sometimes got them at more attractive prices.  That takes some work to get done.  The stuff priced really low is in such bad shape you can't afford to fix it - was at a cute red brick money pit in South Euclid this morning to experience Raindrops Keep Falling on my Head - except it was indoors on the first floor of a 2 story. Basement had 2 breaker boxes with 200 amps each and really, I don't even want to know.  I think Cuyahoga county towns have more inventory and more turn than Geauga towns with a couple exceptions. Right now western Geauga County is low on inventory in most price points. The only stuff that really isn't moving is on busy roads or not rehabbed and too high priced.  

Re that 5 unit in Reminderville - I went to look at it, you didn't miss much. It kind of sits in the middle of a parking lot about 20 feet off of Route 43 with a gas station on one side and a questionable Chinese restaurant on the other. They used a lot of sheet product to cover up the walls. 

Hi Mario

Good luck with your BNI group. I'll keep you guys in mind if I need something here in Geauga.