All Forum Posts by: Bart H.

 ummm….I assume you mean Indianapolis Indiana?

Others may have mentioned it, but there are some pretty bad neighborhoods in Indy at that price point.  I wouldn't do a turnkey at that price.

 In Dallas unless that is near Fair Park, it would be a screaming deal. Bought one for $135K in Elmwood about a year ago that was renting for $1,200.  We put 20K in, and its worth 200K+ and rents for $1,900.  And I think there may be additional upside.

Everything under $200-$300K in Dallas is flying off the shelves.  

 You can actually go to the Dallas city website to see what permits have been pulled.  See example below for one where a bathroom was added.

to Get licensed in Dallas as a GC, you just go to the city and pay the fee, and then pull a permit to do demo and rehab.  If you need electrical and/or plumbing, then the individual trades pull their permit off of your permit.  They have a a rough inspection and a final inspection.  All of the final inspections need to be done before you can close out and get your occupancy permit.

Its honestly not that bad of a process once you get thru it the first time.

https://developdallas.dallascityhall.com/Default.a...

In Texas, which is our case, its 30 days give or take to evict.  So Anyone who hadnt paid from October of before would have been already evicted before December.  If rent was late from Nov, we would have had multiple conversations, and a notice would have been posted during the first week of December.  

If rent was late from December, we would have had multiple conversations.  If those conversations were not going well, AND they were saying they werent going to pay with no reason given. Then yes we might be forced into posting an eviction notice.  If we were given any reasonable reason, we would likely wait until January to post an eviction.

Sorry, running a business doesnt mean you have to purposefully inflict as much emotional damage on another family.

If anything I think its good business to be firm but fair, and often I think its smart to show a little compassion.  Because at the end of the day there is some political optics to what we do, and you dont want to give the news something to latch on to.

 Agreed, I will aggressively work to make sure we get good tenants in the first place, and we will stay on people who dont pay throughout the year.  And if we really had collection issues, we would not renew.

And I get it IS a business.

But be realistic, if someone is having a tough time, to go out of your way to insult them during Christmas is cruel.

Plus, its a lot more likely to elicit a response where the tenant trashes your property.

 I am all for being strict and living up to the lease, and I DO think that people for the most part make their own bed financially.  But there are exceptions, and I think a little compassion goes a long way.  

Plus why do you want to run the risk of ending up on the local news and be labeled as the modern day Henry Potter.  Heck, you might end up finding a bunch of city inspectors up your backside.

Look, we try and treat people the way we would want to be treated, and it wouldn't happen again in January.  But I think both from a business perspective and a personal perspective having some compassion during Christmas is the right thing to do.

 Here is the thing, and its a question you would know individually.  What are your skill sets?  What kind of capital do you have access to?

If you are a contractor, and have some money in the bank, then starting off with a full gut job rehab is no big deal.  But if you dont have construction experience, I can tell you that your first rehab will likely take twice as long and cost twice as much as you expected.  If your budget it tight going into the project, a bad rehab with no other funds available could literally bankrupt you.

As an example, on our first "house hack", we bought a duplex, anticipating one tenant would move out, and we would sell our condo that we had under contract.  Within 30 days, our condo fell out of contract, and both tenants at the duplex had given notice.  Oh and we got sued by an unethical Real Estate agent who wanted a commission that they literally didnt do anything.

Now eventually we got everything all worked out, and luckily we went into the situation with a solid W-2 income.  But it was a little stressful.  I cant imagine trying to do everything right off the bat with no experience.  Just patching, painting, refinishing floors etc is plenty of value add on the first project.

As far as an appreciation play, yes it would be to some extent, but I think its also better to view it as 1) a learning experience, 2) a cost avoidance play.  If you were paying $1,500/M in rent, then after tenants pay you you are covering $500/M in mortgage (tenants paying the rest), then you will have a nice return.

I am not saying that you ignore the normal return metrics, just that you can go with a slightly lower return than on a property you wont live in.

As a house hack, its fine.  I agree with others that getting in for $210K might be optimistic.

But the deal as presented would be ok.  

Here is the thing, don't worry about if there is something "off-Market" as a first time buyer.  Almost all of the off market deals that are out there would require, either an all cash purchase, short closing date, and/or the house would need  substantial rehab. 

I suspect an MLS deal might be your best scenario, it will allow you get to get a move in ready property that you can finance.

Others may have a slightly different take, but imo for a house hack, (and I have done several of them).  Find a property that you are willing to live in.  A bonus if it is in an appreciating market/neighborhood. 

I believe with a house hack that you look at your budget to buy a house.  And what you would pay in rent (say 1,500).  If your house hack is less than what you would otherwise spend, then any rent is positive.  Plus you get tax write offs, capital appreciation, mortgage paydown.

The classic return doesn't have to be that great, you are learning about being a landlord, and learning the process.  Once you get the blocking and tackling down, its pretty easy to scale up and look for off market properties.

 It happens in some areas.  Its not the norm, but there are some in Dallas.  

 Illinois is bad, but BN does still have ISU.  So I think its a lot more stable than most of the cities in Illinois.

 Agreed, we focus in on a few neighborhoods and more or less look at everything that comes on the market.  I would say we now know 5 or 6 neighborhoods.  In those neighborhoods we routinely check out open houses, drive for dollars, look at the pictures for everything that comes up in the area.  

Every property we have ever bought, we drove the neighborhood months or even in one case years before it came on the market.  IMO that is our competitive advantage.

I think having a really narrow scope until you find your rhythm is a good thing, imo.  I cant imagine figuring out the regulations in 3 or 4 cities in my metro area let alone figure out the rules in multiple states.