All Forum Posts by: Chris Stromdahl

We looked at a property this weekend that has good potential except for one major concern:

• In the past it was deemed uninhabitable due to the fact it was one used in the manufacturing, use and/or distribution of crystal meth.

I have a feeling it was used for the manufacturing specifically. I am sure the other activities occurred as well.

Since then, the bank took over the property, remodeled it and has put it back on the market.

• Is this something that I would need to divulge to future tenants?

My thoughts are that since it was professionally remodeled and cleaned that this would not be a factor any longer. However, in an effort to be open and honest, part of me thinks it would be my responsibility as a good landlord to make applicants aware of this.

Any input would be appreciated.

Thanks, Chris

@Marcia Maynard 

Thank you!

Neighborhood: South Tacoma

3/1, 1080sf, 6000sf lot

Greatest challenge: The previous tenant had a cat that sprayed everywhere. We cleaned and painted the entire interior, took all of the floor trim off, had the carpet professionally cleaned then reinstalled the trim. Good as new! We are dog people and thus made a decision to allow dogs, large or small. The carpet will be sufficient for the current tenants tenancy and then we plan to install hardwood or laminate flooring for long term durability.

Greatest satisfaction: The before/after. I think what really solidified this was the tenants family commenting on how nice it looked and complementing them on making the choice to rent our house. Very satisfying, especially after the 70+ hours I put into making it a clean, comfortable and affordable place for them to call home. I also installed a vent fan in the bathroom. Great learning experience and definitely adds to long term durability of our investment relative to the time and money it took to install.

PS...your tenant phone interview document saved me hours of time showing the house to applicants that would not be a good fit.

@Elizabeth Colegrove 

Thank you!

@Seth Mosley 

You're right, for this summary I removed the amount I am budgeting each month for reserves/repairs, but it has been accounted for on the front end. I don't think you are being too conservative, but for me, analysis paralysis is the enemy. I am happy with the returns before and after accounting for the the XYZ factors you mentioned. In closing, I am comfortable with the purchase and that is what matters the most.

@Scott K. 

The roof and furnace are two years old. Thank you for the encouragement.

@Ron Drake 

Wow, this is great information Ron. Thank you for putting this out to the community.

I will inquire myself for the state of WA, but do you know if they are willing to apply this to investment properties? Or just an owner occupy?

@Kenneth Bradford 

That sounds like a fine plan.

In my experience, the key to the process you are describing is consistency and persistence.

Take it from somebody who actively pursued wholesaling: drove for dollars, created a mailer list, posted bandit signs and distributed two mailer campaigns. Only to essentially give up because I did not get immediate results.

Don't be me.

Consistence and persistence.

Nearly one year after we started pursuing real estate investment, my wife and I have purchased, rehabbed and successfully rented our first buy and hold property.

Purchase price: 105K

Down payment: 15,750

Closing costs: 1,200

Repair, rehab and upgrade costs: 1,300

Total capital investment: 18250

PITI: 700

Rent: 1,150

Monthly cash flow: $450

Cash over cash: 30%

Annual NOI: 10%

These numbers don’t take into account vacancy rates, but it is still solid up to 10% vacancy. It only took us a week to rent, so in the current market I am confident we will stay well below that.

Overall, I am very happy with the results. It is a very attractive house in a good neighborhood. Though I am not banking on appreciation, I do see the long term potential of appreciation being in our favor.

Thank you to the BP community. I could not have done this without all of the help and support you have given me over that last year.

Specifically, I would like to thank Marcia Maynard and Curt Bidwell.

@Marcia Maynard Marcia, your tenant screening questions were key in filtering out applicants from the beginning and making sure that we were a fit for them as much as they were a fit for us.

@Curtis Bidwell Curt, your guidance post purchase saved me time and energy. I look forward to our next coffee.

It was interesting because at one point in my research I was considering out of state purchases. The Puget Sound region is expensive and I did not think I could buy here and realize the returns that I wanted. I spent a considerable amount of time looking at properties in areas such as Columbus, Baltimore and Nashville. This was valuable because it gave me an opportunity to talk with a lot of different real estate professionals. I learned something from each of their perspectives.

I am glad that we came full circle back to the Puget Sound and can now see that buying successfully here is possible.

We are on to our next property, going to see ten different houses tomorrow. Keep you posted.

Thanks, Chris

@James Hamilton 

Private message me. I have a spectacular referral for you.

@Dmitriy Fomichenko 

Understood. Thanks.

Yard work responsibilities will be spelled out in the lease but I will stick to open and consistent communication.

Thanks, Chris

@Eric Love 

Although it may be obvious, this only applies to gas water heaters, correct?

Any precautions one should take with electric water heaters in the same scenario?

Thanks, Chris

HA!!