All Forum Posts by: Artur A.
Artur A. has started 31 posts and replied 76 times.
Post: Rehab vs cosmetic renovation by Property management contractors
- Posts 78
- Votes 27
Quote from @Drew Sygit:
@Artur A. what data has your PMC supplied to support their recommendations? They should be able to send you several comparables, not just 1-2, that show what they claim.
Also have an issue with them getting cabinets at Home Depot! Should only be done if matching something existing. Otherwise, they should have a dealers license , or have a contact that does, and be able to get better quality cabinets for the same price.
Why are they replacing the tub?
Why an exhaust fan in the kitchen and not an above-range microwave?
$2k to replace all outlets? What's the price/unit? Material is less than a dollar and it take 5-10 minutes each!
Why do you need insulation in a basement?
$350 to snake a sink?
Exhaust fan in bathroom should be under $450
Smoke detectors no more than $50/each installed
About data from PMC - I guess they have a remodeling and home improvement business. They shared 2 comparables (cosmetic rehab and remodeling)
Regarding outlets - ungrounded outlets are in the inspection report. Take them out (ground 3 prong outlets). Plus grounding rod (6 rooms * 5 in the room)
Regarding the snake - he said they need a long snake because it might be outside of the house
Updates for cosmetic rehab:
labor/Material rough estimate
Flooring - 3 rd floor take out the carpet and staples and paint - $1200
Paint ( Need to be provided )
Bathroom Caulk and grout reglaze the tub and sink - $650
Reglaze Kit to be provided Plumbing - $250
Plumbing Supplies see/select home depot websitePainting - 3000
Paint see/select home depot website
Use plexiglass for broken glass - $150 / per instance Plexi glass need to be provided Cleaning - $350 final cleaning
Trash Out -$500 ( includes dumpster and dumping fee to the land fill ) - Sofa and Bed with frame
From Inspection Report
Labor ONLY
3.3 - Repair gutters - $475
5.7 - Dishwasher - replace ( $450 )
4.1 Damaged drywall (wallboard contractor) - $ 750
4.2 - Wall - elevated moisture leaking window - replace window = seal it silicone - $250
6.0 Sinc is draining slowly (bathroom) - snake the sink - $350
6.1 Float on the flapper (Toilet) - $75
9.1 - removing deadlines - $175
10.7 - replace all outlets - $2500
6 outlets in each room (2.5 br)
10.2 Grounding rod - have to check with electrician
10.6 Damaged fixture (fan) - $150
10.9 Smoke detectors - $150 (2.5 br)
@Timothy Boyd please share his contact. thanks in advance
Post: Rehab vs cosmetic renovation by Property management contractors
- Posts 78
- Votes 27
Thank you @Kushaal Malde
Post: Rehab vs cosmetic renovation by Property management contractors
- Posts 78
- Votes 27
Hi. I've recently bought an out-of-state rental property in Cincinnati, OH.
My property manager gave me a list of rehab items for the unit. What are your thoughts?:
I'm thinking about doing a rehab vs. just fixing & cosmetic renovation. With rehab, rents will increase by $200 and we'll be able to get a better tenant (in PM's opinion).
What are your thoughts on cost (is it better to find and hire a contractor or go with PM's contractor)? Is it better to do a rehab or cosmetic renovation in terms of ROI and risks?
labor/Material rough estimate
Flooring(labor) : 2500
Flooring Material: 1.5 per sq feet + padding
Kitchen - 3000
Cabinet & counter top ( see/select home depot website)
Bathroom - 3000
Tile + Tub and fixtures ( see/select home depot website )
Electric - 1500 ( inside unit )
Electric Materials ( see/select home depot website
Plumbing - 1500 ( inside unit kitchen and bathrooms )
Plumbing Supplies see/select home depot website
Painting - 3000
Paint see/select home depot website
Windows ( replacements ) per window $450 all included
Cleaning - $350 final cleaning
Trash Out -$500 ( includes dumpster and dumping fee )
Appliances - 2000
// Total (without materials): 18’700
From Inspection Report
Labor ONLY
3.3 - Repair gutters - $475
5.4 - Exhaustive fan (kitchen) - $350
5.7 - Dishwasher - replace ( $450 )
9.3 - water heater - fixed and fixed all the leaky gas lines - 2K
10.7 - replace all outlets - $2500
2.9 - Insulation not present (basement) -
4.1 Damaged drywall (wallboard contractor) - $ 750
4.2 - Wall - elevated moisture leaking window - replace window ?
6.0 Sinc is draining slowly (bathroom) - snake the sink - $350
6.1 Float on the flapper (Toilet) - $75
6.4 Exhaustive fan in bathroom - ??
7.4 Ventilation in bathroom - ??
9.1 - removing deadlines - $175
10.2 Grounding rod - have to check with electrician
10.6 Damaged fixture (fan) - $150
10.7 Replacing outlets
10.9 Smoke detectors - $150
Quote from @Adam Walter:
These are my findings/assumptions:
1. You have annual rental income at $25,200 the MLS listing has it at $1320 per month or $15,840 annual
2. Property Management is 10%. I use a total of 20% for vacancy, CAP Ex and Maintenance especially for multifamily and older properties.
3. Water average is $95 per month and can only go up (I had a tenant in a multifamily who could only sleep if the shower was running!!)
4. Current Real Estate Tax is $2837 (I am using this number). I'm assuming you believe it will go up once you purchase the building. Not a bad idea.
5. The rest of the calculations, I used your numbers. Total price is $235,570 ($219,000 + $10,000 + $6,570)
Findings:
1. Using current rents I have a NOI (before debt payment) of $5,683 for a Cap rate of 2.41% Cash flow is -$4158 (after debt payment)
2. Using your rent which I'm assuming is market rent, I have a NOI of $12,235 for a CAP Rate of 5.19% Cash flow is $2394 for a 3.36% Cash on cash return
I'm not sure how you are calculating CAP rate. For a 10% CAP your investment will need a NOI of $23,500
If you like these numbers, I have a bunch of rentals, I'd love to sell you :)
Not sure if it's possible to find these type of deals nowadays ($150 cashflow per door).
Thanks Adam and Tchaka
Hello Guys,
can you help with reviewing deal please?
2 units - 1 bd, 1 bath; 2.5bd 1 bath
| 4009-4011 Ivanhoe Ave,Norwood, OH 45212 | |
| Price | 219000 |
| Downpayment 25% | 54750 |
| Closing costs (3%) | 6570 |
| Fix | 10000 |
| Total cash needed | 71320 |
| Principal (4.375%). 30 y | 9840 |
| Prop management (7-9%) | 3820 |
| Insurance | 1448 |
| Taxes (1.81%) | 3963.9 |
| Utils (Electricity, Gas, Water) | 1080 |
| Maintenance (5%) | 1260 |
| Vacancy (5%) | 1260 |
| Rent Annual | 25200 |
| Cap Rate (%) | 11.5 |
| Operating income: | 2528.1 |
Post: Looking for a property management company in Cincinnati, OH
- Posts 78
- Votes 27
I am closing on a property in Norwood this month and if you can share a good PM for Norwood I would greatly appreciate it. Thanks so much in advance
Post: Buying negative cash-flow property. Can you write off expenses?
- Posts 78
- Votes 27
up
Post: Buying negative cash-flow property. Can you write off expenses?
- Posts 78
- Votes 27
| Price | 335000 |
| Downpayment 20% | 67000 |
| Closing costs | 9263 |
| Principal | 15696 |
| Interest 4.125% | |
| Prop management (10%) | 4005 |
| Insurance | 1783 |
| Taxes (County - 0.95%) | 3868 |
| Maintenance (10%) | 2520 |
| Vacancy (5%) | 1260 |
| Rent Annual ( Rentometer) | 25200 |
| Operating income: | -5000 |
| Year | 1978 |
| Schools | 8,8,4,8 |
Would you recommend buying a property with negative cash flow? -8-10k
I don't want to pay 10k from my pocket within next 5-10 years before it will start break even (even if it appreciate would be 25%, in cash - 90k)
Is it possible to write off/return 100% of expenses from investment property? (or only 30%)
Thanks
Post: Experience with vacation rentals in SW Florida
- Posts 78
- Votes 27
What is your opinion on buying vacation property and using a company that will do short-term management (for 20% + some fee)?
A single-family vacation home with a pool can cost 400k. Annual revenue ~35k
Has anyone had an experience with that?
Is it a headache comparing with long-term renting, considering paying high taxes (30-40%) and other issues?