All Forum Posts by: Phil Mcnally

Just start with the 1% rule and see if anything is remotely close. $1mill property = $10,000 monthly rent. I don't think you will find anything for 100's of miles that could cash flow from rent. That is why I rent in the Bay area where I can live in a 'normal' $1mill house for less than $3500 a month.

Hi All

An update 3 years on.

So far not great not terrible. 

Bad News:
The $665k property only appraised for $690k 3 years on so around 2% appreciation. At least it is going up so far.
The four unit rents currently total $6050 or around 0.9% so a little under what I was hoping for.
Vacancy gaps have meant the actual monthly rental income has averaged $5433 over the three years.
Expenses have been higher than expected including property management come in at $1974/month
Escrow to cover Tax and Insurance is another $1200/month
I have now added $21k into this property to keep it going since the initial purchase.

When all totaled it has been cash flow negative by around $7000/year with minimal appreciation of either rents or property value. 

Good News:
My equity has increased approx $35k in the property
I recently refied down from 5.35% to a new rate of 2.99%
This should save approx $9000 a year while paying approx $2500 more principle so an $11,500 benefit.
This should push things into a positive cash flow going forwards.

Lets see how the next few years go with the new financing.

Cheers...phil

Hi All

I am looking to refinance a four unit building to lower the rate (possible cash out). Loan qualification will be based on other rental income. I have other refi successfully in progress but need a contact for this one. High credit scores and paperwork ready.

Let me know...phil

Is smoking allowed in the lease? If not then they are in violation. I am sure blocking smoke alarms also qualifies.

 Good luck to us.

There is currently a 10 loan max per person. If married you can get 20 as long as you do not do joint borrowing. Of course you still have to qualify. Mature rentals help with this as income is a good thing. Recent acquisitions need to calculate current rents etc to qualify.

I have not moved anything into LLC's yet although it would be good protection. I have relied on umbrella insurance instead.

phil

@Chris Mason

Just wanted to follow up and say thanks for the spouse loan advice which has lead to four more properties over the last seven months. Still a few loan slots open.

phil

Hi All
Just wanted to follow up with the news that this morning I closed on a 660k, four unit in Anchorage AK that satisfies the 1% rule and qualified for a conventional 30y fixed loan at 5.35% (rates up recently). It would not have happened without suggestions on this thread. Thanks @Jonathon Rodriguez for doing the deal.

I will come back in a few years and tell you if it is working out :-)

phil

Meant Listing agent.

Hi All

I have a SFH in Noblesville, IN that I would like to sell and need a local agent to get it done. Let me know...phil

15488 Harmon Pl,

Noblesville, IN 46060

3 beds 2 baths 1,623 sqft