All Forum Posts by: Chris Sellers

Christian,

Sounds like a good deal to me.  You need to get a copy of that lease.  Does it give you an out to raise the rent when the property changes owners?  Many leases have language that make allow them to expire if the property transfers.  If not, it might be worth working through your realtor to have the current landlord update the lease to make these changes (he can give the renter a free month to sweeten the deal if needed). 

If you can't get a lease that allows you to raise the rent when you take over, you'll need to price this 1 year loss of rental income into the purchase price and just wait it out.

I wouldn't worry about a tenant being there.  This happens all the time, risk we all take. 

Good Luck!

Chris

Conner,

I like the way you're thinking; great to see such motivation!

In a mobile home investment, there are two parts.  The land (or lot) and the mobile home itself.  The land appreciates, the mobile home depreciates (rapidly).  Also, moving a mobile home can be expensive ($3k) or a total loss if an older one breaks up during the move.  

That being said, it's a numbers game in the end.  You just want to be the one collecting land that your renters pay for, not the one getting stuck with a bunch of junk trailers.

Good Luck,

Chris

Stephanie,

Great to hear you're wanting to switch from renter, to owner, to investor!  So cool.

As an investor, you'll want to tap into your cold, analytical, numbers side. If a deal doesn't make sense, focus your energy into finding a deal that does, instead of wishing this one did. I'd recommend continuing to rent your condo in the interim and look for other deals. Condos are rarely good investments anyway; the HOA fees eat most of the profits. Your landlord owing $125k on a condo you've already deemed to be worth only $85k as an investment proves this point.

Listen to some old BP podcasts, read some recommended books and save some $ for a down payment.  Then look for that perfect duplex to live in / rent the other side out.

Good Luck!

Chris

Tommie,

This one looks like a winner to me.  The picture isn't too clear, but be sure you don't have entry repair costs.

Congratulations!

Chris

Eric,

Congratulations on the duplex!  That's how I got into the game, great experience.

You might be over thinking this quick closing with cash idea.  I've closed 30+ cash deals and never thought about it much.  My realtor just contacts the different attorneys he deals with (depends on county and type of deal) and they close in about 2 weeks after I sign the contract.  I never meet the attorney, all by email and sometimes phone.  

In my experience, closing attorneys close on time about 50% of the time, and everybody sort of expects this bad performance from them.  They routinely chase documents in the final hour instead of upfront and fail to secure the proper paperwork on time.  Nobody really sweats it.  If we see it's going to go past the contracted closing date, my realtor sends out an addendum to buy a few more days.

I used to get pissed off at them, but now I just see it as part of the process (like the DMV).  

Good Luck!

Chris

Elizabeth,

Here in Charlotte, I would definitely pass on a deal with these numbers.  Purchase price would need to more like $150k.  Too much money tied up, too little upside, too much potential downside in this old house.  Not sure if you have the option in CT, but you might find a better returns at a lower price point and just buy more of them.

Good Luck!

Chris

Patrick,

High crime, low income properties have always been good to me.  Just have to buy them right.

I'm not from Ohio, but your property tax and insurance estimates look high to me for an $80k property (Cinci rate 1.68% according to Google).   Here in Charlotte, I'd line up to buy $80k 4plexes that rent for $2k.  

Good Luck,

Chris

Andy,

I like the idea of condo investing for the reason you mention, but I've never been able to make the numbers work.  The HOAs just erode the cash flow too much in most cases and the appreciation usually isn't there.  I've bought 35+ deals, no condos yet.

I am thinking about creating a condo complex, however, and profiting from those HOA fees. That might be the best way.

Good Luck!

Chris

Vinay,

Try Charlotte or Raleigh North Carolina.  

Good luck!

Chris

Bill,

Investing in real estate is a life changing, wealth building activity.  Focus on the long game.

If I were in your shoes, I'd be thinking about increasing my portfolio (1 unit to 2-3 units).  Renting your current house out could be the fastest way.  Your next property can be a duplex, where you still benefit from all the fha rules for low money down, better interest rates.  After this, you can have a renter paying for your current mortgage, a renter in the duplex paying the duplex mortgage and living for free.  Then you should be able to save money for the next down payment.

Listen to the audio book "The Richest Man in Babylon" on YouTube to get some motivation.

Good Luck!

Chris