All Forum Posts by: Chris London

For Comparison: 

Assuming the OP put down 20% + closing costs totaling $50K here is what would have happened if he put that money in VTSAX instead.

Assuming that you invested $50,000 in VTSAX on January 1, 2005, and did not make any additional contributions or withdrawals, your investment would be worth approximately $244,000 as of May 2, 2023. This calculation is based on historical performance data from Yahoo Finance, assuming that all dividends were reinvested. (ChatGPT).

@Donald Danley Jr I see the listing for the properties you mention on Zillow.

$90K w/ 20% down at a 7% loan gives you $600/mo piti payment.

This is in addition to the rate you are paying for your HELOC.

$890/mo rent cash flows just shy of $300/mo. (minus your HELOC additional monthly payment)

There appears to be a lot of land in Wadesboro so unless you already own the manufactured home to put on the potential 3rd lot it's unlikely building a house that rents for $500 would make sense at this point.

$300/mo cash flow = $3,600 per year in potential cash flow. However, these homes were built in 1940 (83 years ago). A new roof for example would set you back 2-3 years' worth of cash flow. 

A lot of good data on Wadesboro here on this Redfin link https://www.redfin.com/city/17...

Appreciation seems uncertain based on this data so with limited (or potentially negative w/ the HELOC) cashflow and uncertain appreciation I'm not confident how great an acquisition this would be. A major repair or extended vacancy and you run the risk of not paying your HELOC and losing your personal residence in the process.

IMO the market is on a long downward trend, I'd suggest just keep socking savings away (in a high-interest savings acct or T-bill or CD) and using that money to buy when home prices are more depressed. Patience to win the race. Good luck!

@Vaishaag Panegal

The 1st picture on Zillow that shows for me is a terrible street-view picture and not the great photographs that your PM took. See if you can edit this.

The property description while thorough is not written well. Check out this re-write below:

Looking for a stunning townhome with picturesque mountain views and move-in ready from May 1st? Look no further than this gorgeous townhome in the desirable Riverwood community.

This spacious three-level townhome boasts an open floor plan and numerous high-end features, including stainless steel appliances and gas cooking. Enjoy the stunning mountain views from either the large deck or the newly installed paver patio in the backyard.

This home is full of privacy with a large backyard and plenty of room for outdoor entertaining. The main level features an eat-in kitchen with a center island and breakfast bar, a spacious living/dining area, and access to the back deck for easy grilling.

Upstairs, you'll find a master bedroom with an en-suite bathroom, two additional bedrooms, a second full bathroom, and a laundry closet with a full-size washer/dryer. The finished walk-out basement and one-car garage provide ample storage space or can be used as a family room or home office.

Conveniently located near Route 29, NGIC, UVA, and Hollymead Town Center, this townhome is the perfect combination of luxury and convenience. Trash pickup, washer/dryer, and HOA fees are included in the rent, and pets are allowed. Tenants are responsible for gas, water, electricity, and internet.

Don't wait - schedule your tour today to see this beautiful townhome for yourself! With its turn-key neutral finishes, lots of natural light, and fantastic curb appeal, this home won't be on the market for long.

Quote from @Pat Lulewicz:

@Armando Montrond Wesley should rent for more than $1,600. @Chris London thoughts? Furthermore, that $1600 rent (more like 1800 in my opinion) is a LTR rent and therefore won't be your responsibility. If you go and MTR or STR it, sure $300 should do, but then your income SHOULD be much higher, thus the point of switching it over to one of those strategies. Otherwise looks right.

Keep in mind, this isn't the midwest. Raleigh/Durham is one of the fastest growing areas in the country. Cash flow is TOUGH to find here. Is you can get breakeven on a LTR with Y1 rents, you found a nice little diamond. The STR/MTR strategy and time for LTRs to rise is what gets you that cash flow. Just make sure to buy that in the right location of town.

2312 K Wesley is nicely remodeled. Renting in-season and allowing for pets I might start as high as $1899 and scale back as needed.

To someone else's point about creating a deal. If you look at the history of this house, someone bought it in Dec '22 (2 mo ago) for $265K and put some lipstick on it (LVP, paint, appliance, and light fixtures), and is now reselling it for $365K. So approx $75K profit for a quick flip.

@Vaishaag Panegal

That's a tough rat

Peanut butter snap traps have always worked for me.

I would want the entry points sealed off at a minimum. I'd work w the 1st guy to see what his plan would be if the rat came back after his service.

I realize 3703 Hester Cir was just a generic example and not the point of your post but here is some detail on that property to put things in a different perspective. 

That is East of the 440 and on the border of Knightdale. This is not a bad thing, East Raleigh and Knightdale are great but you would be looking at $1600-$1800 for that property providing renting in season (April-Aug) and allowing for pets.

If you look at the sales history of this property the buyer/flipper bought it in March '22 for $300K and tried to sell it for $350K and now is back at $300K minus what he paid to flip it.

@Matthew Schellberg in NC tenants can end their lease by finding a replacement for themselves. While there are a few rules around this concept, as others have said, tenants tend to leave when they want to. It is the landlord that ends up being 'locked in'.

I suggest 1 year with an end date between April 1st and Aug 31st. If they are good tenants then you renew for another year.

Also, if you are listing your property at market rate in Cary now, I can tell you a 10% increase would likely take you way above market rate. That % may have been the norm during covid when all the Northerners were moving here but it has already gone back to a more typical 2 -3% (assuming you are already at the market rate).

@Ryan Sawyer

To try and answer your 'legal' question, Yes, with the proper notice that your state requires you can legally go into the property.

However, your PMA (property management agreement) may have language about communication between tenant and owner. As others have stated above there are a number of situations that occur when an owner and tenant meet and the property is being professionally managed.

To satisfy all parties you might ask your PM to provide specific details/pictures of the inspection that give you the peace of mind you are looking for. 

If they did zero inspections over the course of a full year last year you should take issue with this. You might ask the BIC (broker in charge) of the office if they have a better PM they can assign your property to or if this is not feasible end the PMA when appropriate and try out a different company.

Good Luck,

Chris London

@Rob Tepe

I'm a big fan of getting my appliances at Costco.

If you buy them with the Costco/Citi Visa card you get 2 additional years added to the manuf. warranty.

Many will point out that Costco is not the cheapest and they would be correct but as someone said in the comments above they don't make appliances like they used to and the cost to repair often can get close to replacement so the 3-4 year warranty can save you money and stress in the long run.

@Andy Casey

The lease controls renewal/non-renewal. 

Both 30 days and 60 days are common in traditional leases.

In a 60-day notice example, most respectable landlords would communicate 70-80 days before the end of the lease and ask the tenant about their intentions to end or renew the lease. That still does not take the burden off the tenant to read their lease thoroughly and make themselves a reminder.

Note, because we sign student leases for UNC-CH for the upcoming school year 9-12 months in advance, students need to renew (or not renew) ~9 mo in advance. The point of this comment is to reinforce the point that the lease controls the renewal date.