All Forum Posts by: Rebecca Belnap

@Shannon K. This picture isn't exactly what you are talking about, but it does show furring over problem areas.  http://www.hammerzone.com/archives/energy/insulati...

To get the best idea, go to KSL.co regularly to see what else is available.  We have a 1 bedroom in Lehi that rents for $875 and that includes utilities.  We have a 6 bedroom in Saratoga Springs that we are renting for $1900, but it is a friend and we are only charging him the actual cost (long story).  Smaller homes tend to rent better.  I agree that your own home would rent for $2200, and the smaller investment homes should rent for $1500 to $1800.  One word of caution, the further south you go, the lower rent you can get.  Stillwater is about the furthest south I would recommend.  As a rental, north of Smiths would be best since it is closer to work, although near Westlake High school isn't bad either.  Here is an example of something too far south.

http://www.ksl.com/homes/listing/rentler?ad=r14444...

If you are sure about refinancing, talk to a local mortgage company about the issues you will have with refinancing. You need it off the mls and it may even need some time for seasoning once you pull it off. Homes that are for sale can't be refinanced. The transfer in and out of your llc can be considered a change in title and can make it more difficult to refinance too. It used to be that if you have 100% ownership of the LLC they would not count it as a change, but FHA has changed their rules and many conventional banks are following suit.

@Coco Zuniga   You are absolutely right about tenants being like employees.  They aren't customers so the old "the customer is always right" is dead wrong.  They provide you income.  If you train them correctly to understand what their responsibilities are they will usually do it.  If you let them know that they can get away with a lot, they will.  Waive the late fee and late becomes the norm.  

So where are you starting from?  If you have 20% down payment, the options are wide open.  If you have no money down, you will probably need to house hack.  Seller financing is hard to get, but possible.  What are you looking for?

Yes, it is still a great time to invest.  The temple is a big deal and everyone is speculating where.  If you are in walking distance, you should have at least 10% extra appreciation when it is done.  The other factors are the fact that there just isn't any inventory.  If you can find anything under about $100 per square foot, it's a good deal.  We are seeing no slowing for at least 1 to 2 years.  

Will it come down at some point?  That is the big question.  Some are guessing that in 3 years we will see some correction.  The key is to find something that can cash flow even if the market turns on you.  You seem to want to hold for the long term, so the market fluctuations are interesting, but not very relevant.  It's a beautiful city with a lot of people wanting to live there.  You shouldn't have any trouble renting.

Our duplex is just 3 blocks away so I know the area very well.  You should be able to rent it with 0% vacancy at $850.  It is a little bit small, but having a washer/dryer in the unit is a big deal.  The big problem is that it isn't showing up on KSL.  KSL is the main place people use to search for rentals in Utah County.  No one is seeing that it is available.  If it wasn't already vacant and you had the time, you could probably get $900.

$700 per month for a 2 bedroom?  What city is it in?  Even Springville and Spanish Fork are going for more than that.  I have a 1 bedroom in Lehi that is going for $875, but that does include all utilities.  Still, your rents are low.  Vacancy in Utah county is basically 0.  The maintenance fees seem high also.  How old is your 4plex?  Yes, you could get at least $400,000 for a 4plex almost anywhere in Utah county.

The problem is either your management company or your units are 80+ years old and falling apart.  Without knowing where they are and what they are, it's hard to tell, but I'd be happy to look at it.

I know in theory how to fund large commercial projects, but lack the down payment for anything on the scale I would like to do.  I saw a development in Tooele a while back that was fully developed for about 30 fourplexes bust passed since I only have a small investor pool and something on that scale would bankrupt us before we could have the first units done.  It's one of the reasons I started being more active on bigger pockets.  I want to be ready to act on the good projects when I see them and work up to being able to handle them.

@Becca Summers  It's a mix.  Some are debt free or close to it.  Some have a dozen or more credit cards.  The tough ones are Education Debt.  You see some 20 year old student loans for people who are now helping their kids get into college.  I also go to meetup groups for investors, so I see some Real Estate Training Debt as well.  It's hard to have to tell someone that the reason they don't qualify for an investment property is because their Debt to Income ratio is too high because they borrowed $50,000 for Investor Education.

One loan that can keep payments low is a HELOC piggyback loan. They get a Conventional FNMA for 80% of the purchase price, a HELOC or 15% and pay 5% down. It eliminates mortgage insurance. The rates on HELOCs are low right now, but they do need to remember that the HELOC is variable.

Since mortgage insurance isn't included, they can usually qualify for $30,000 to $60,000 more than they would if we are just going with a no money down or a 3 to 3.5% loan. It can help take them out of the bidding war zone and they get a better home for the same monthly payment. Not a lot of companies offer it since the commission on a HELOC is 0 for most of us. Still, it is usually the best loan for a person with 5% down.

@Jeff Rappaport is the most experienced investor who has replied to you yet.  He is one of the investors I listen to.

We are having a slight leveling, but inventories are still low.  There are bidding wars on most single family properties that are even close to habitable for anything under $300k in most areas.  As a general rule in Salt Lake County, the east side is more valuable than the west side with pockets occasionally breaking that rule.  For Utah county it is the North cities being more valuable than the South. This summer looks strong and even rising interest rates are barely slowing the growth.  

My main concern is seeing that a lot of clients are using cosigners and coborrowers to qualify for houses and are having trouble qualifying based on their own incomes. Considering that DU allows a 57% back end ratio with good credit, this could spell trouble down the road.