All Forum Posts by: Carrie Giordano

That first weekend...

Painting on the interior started

A large section of the back fence which had fallen down had 3 new posts installed and the fence put back up. $475

Clean gutters on house, clean up trash, debris & leaves, trim bushes $200 

December 2nd (Wednesday)- House closes

On Friday, I asked my new agent about the key to the house and he didn't have it nor could he seem to get it. It actually took me until Sunday to get a key! This was very frustrating because I had to cancel my contractors who were set to start inside on Saturday. While it's my mistake not to ask for a key on Wednesday, I had never had an issue with getting a key, I do feel that if I were local I could have resolved the issue sooner.

Right away, I want to get my contractors started especially on the outside repairs (before the snow hits.)  I won't be returning to Ohio until December 17th and I would like as much done as possible before then.

November 16th - Putting up smoke/ carbon monoxide detectors

For the city, I need to pass a fire inspection before the house can close. This requires having a smoke & carbon monoxide detector outside the bedrooms on each floor as well as a smoke detector in the basement. This is something I always do whether the city requires it or not so it's not a big deal. However, I haven't been able to make an appointment with the fire prevention dept so this is something my agent will handle while I'm in California.

Trying new things....

In the past I have always flown back to Ohio after closing and spent 1-2 weeks getting the place up and ready to be rented. However, I am trying something a little new this time so that I can see how efficiently investing from a far can really be (or not be!) Being that I am headed back to Cleveland for Christmas rather than flying home for the closing I am putting a lock box on the house and giving my contractors the code. My plan is to then finish up the house when I return in December.

What worked really well on my last rental was to take all the measurements, get estimates and order appliances & supplies ahead of time so that as soon as the house closed the work would be started. This included everything from new locks, appliances, blinds, light bulbs, face plates and any other odds and ends the house needs. It saved me a lot of time running back and forth to Lowes & Home Depot!

Yep! These are going to have to go!!

@Kalen Jordan thanks so much! Do you have any areas out of state with good potential that you are familiar with? If it were me and I didn't have a place in mind, I would probably vet out a few cities with good rental potential (reading the forums can lead you to a few.) I would then visit a few and reach out to other bp members who may be able to give you insight as well as attend a local reia. Once I found the right city, I would learn as much as I could about the market and good and bad areas. From there I would start building relationships with agents, contractors or other investors and then start making offers.

For me, it usually takes 1-2 weeks to rehab properties and I love the process but that may not be for you. If you're feeling impatient and just want to jump into the game it sounds like turnkey is the way to go! I personally have never done it but from all I have read (good and bad) you will still need to be very diligent in vetting the area, turnkey provider and property manager. 

Good luck!

@Federico Gutierrez thanks! I am happy with the inspection, nothing too out of the ordinary. The house is on the eastside in Lake County.

Nov 12th - Inspection Day

Sadly, I had to go back to Ohio for a funeral, so by chance, I was able to be at the inspection. Getting to see the inside of a house you are quite possibly purchasing feels to me kind of like what it felt like as a kid on Christmas morning!! There’s the excitement of wanting to know what's in side but a little bit of nervousness that it may not be what you were hoping for!! Luckily for me this one turned out pretty good!

Because it's a HUD home and didn't pass the air pressure test I was not able to turn the water on, we will see later how big of an issue the plumbing will be. My biggest fear with houses in NE Ohio is the basement and honestly I would prefer a house without a basement but tenants do tend to like them. This basement however, is dry and has a solid foundation. Like all homes I have bought, it needs paint from top to bottom, new carpet and quite a few odds and ends. Other than that the bathroom in the basement need to be finished off (which I knew from photos,) a large section of the fence outside needs to be put back up, probably will need a new hot water tank and the biggest surprise was that the garage didn't have gutters so those must be added and some of the rotted wood from their absence must be replaced. On a positive note, all of the windows in the home are fairly new and the home has a brand new dishwasher still with tags. My inspector said it's a solid house that has been well maintained, I will keep my fingers crossed about the plumbing!

If you have not yet done a HUD deal but would like to then you should be prepared for a bit of a hassle with submitting your bid, especially if you are bidding out of town. Once your bid has been accepted, HUD requires a written bid with a signatures in ink within 48 hours. If there are any cross outs or mistakes then they will not accept the offer. So when bidding out of state your agent & broker must sign the documents then overnight them to you and then you overnight them to the HUD office.

Oct 28th - I used a new agent on this deal and hadn't realized that he was not that familiar with HUD, so he asked for a one day extension returning the contract. It was granted so I just received the documents today and overnighted them back to the office in Pennsylvania.

@Robert Quinn thanks! I have looked into the west side a bit but it seems like the areas I like (like Lakewood) the taxes are so high it's hard to make the numbers work. 

@Reese Thompson thanks! Yes, this is a buy and hold. Being out of area, I stick to areas I know to be safe, have good schools and a solid rental market. I look for homes that area at least 3/1.5. Typically, I look for homes that won't need any major renovations before being rented. Most importantly the numbers need to make sense. I am very conservative in my figures...

Expenses=

+10%vacancy

+10%capex

+10%pm

+10% repairs

+taxes

+insurance

NOI - expenses = what's left must cover the payment on a 15 year mortgage

I am okay if this just breaks even because I'm in it for the long term. My expenses have yet to be this high however, it makes me feel comfortable having that cushion.