All Forum Posts by: Denice S.

Hi Brian,

I've had success attracting renters from elmwood/Allentown to my properties outside of that area, but only when it's a vastly different property...such as leaving their small apartment for my whole house @ similar rent.  

Over the years, I have found that 'trendy neighborhood' renters are in those neighborhoods because they can afford them and truly enjoy the walkability factor (which s.buffalo cannot offer).  Getting them to leave their current 2-unit situation for yours in s.buffalo even at a reduced rent is highly unlikely.

The good news is that there are plenty of great applicants in s.buffalo.  Simply make your units clean, fresh and modern. Use grays and whites for paint.  Make sure fixtures and thresholds are silver-tone and matching. Keep flooring easy to maintain and neutral.  

Price slightly below market and you'll get a great pool with the added bonus of applicants who might stay a really long time because they have roots in s.buffalo.

Don't get too turned on by low taxes. Buffalo water, is extremely expensive and sewer rent and garbage is also high and billed separately.  Plus, new rental registration laws with lead based paint abatement requirements could eat up your annual profit. 

In my opinion, cash flowing $250 per month with a $5,000 investment is worth pursuing in a c class but the price still has to be right. Make sure your c class neighborhood still has a good ownership %. If it's all an all renters neighborhood, 46k may be too high of a price tag. What are the comps? What would the seller get in the MLS? Make sure you're not overpaying and could resell this property (without a loss) if you can't get the right tenants. Check craigslist ads to support your $650.

Use an attorney to close the deal. Seller financing form needed in this deal and proper recording of your mortgage at the county.  Ask seller how they intend to record your payments, provide year end interest statement (for tax time) etc.. and since the lender and seller are the same person, remember to buy yourself an owners title insurance policy,

When the property meets your criteria and you're in a multiple offer situation, it's okay to offer above asking...as long as you're not overpaying.

Is this the same property where you owe over 80k with lots of credit cards?  If so, you may be going from bad to worse.   How much will it cash flow per month as a sec.8 rental in high tax Cheektowaga?  And why are you hoping for sec.8?   

Have you considered pricing it just slightly above break even or a loss so you can take the money and re-group?

This is your first flip and it's bad. However, if you rent it out , you may be more likely to quit investing vs. taking a loss and having enough funds to try again......unless, of course, you have other money to keep investing?  But I get the impression that all of your money (and then some) is locked up in this project. 

Cash that money order and make your rent demand reflect the balance. There is no reason to refuse it since you haven't begun the process. 

If you don't want the tenants, forget the rent demand on t2 and give notice of non renewal instead.  Maybe t1 will see it and send payments on time. Still serve t1 rent demand.

Sounds  like this is no longer what you set out to accomplish.  You spent a lot of time devising your strategy and came up with house-hacking.  Now, this isn't a house-hack; don't let you property choose you.

Get out by using any or all of these:

FHA means owner occupant

Look for anything in the contract such as "buyer accepts property in condition as of inspection" 

Look for sellers disclosures regarding "one" rented unit, 

Check the remarks section of the Mls -anything referring to one vacant unit such as "live free" or "tenant pays your   mortgage" lines.

Isn't there an attorney approval period? 

Find something wrong at inspection 

I keep reading and rereading your post and I still don't see where you have any of your own money in the deal. If that is the case and all you're doing is finding the property and then (possibly) listing the property at 2.5% plus enjoying 50% of the profit...that's as passive as it gets.  It's really hard to realize passive income on a flip without being the lender and you should jump at the chance a million times.  Your an agent and by default these deals will come your way several times per year without you having to spend time and money looking for motivated sellers. 

You could have 5 of these deals going, making more money and working far less than if you flipped one house on your own.

Unless I've missed something?

Most cities have regulations regarding minimum (living area) square feet per person.  Call your city/village or look online for your code and don't violate it.  If your city has no restrictions, it defaults to your state code.

 I can tell you that every single time a person has shown up to an open house, filled out an application and waved cash around, they failed our credit background check...and I mean miserably.  Foreclosure, multiple judgment's, tax warrants...etc.  My advice is "proceed with caution" and do your background checks.  Also, hold an open house, make people register by calling and answering a few questions and invite them all at the same time.  Take applications on those who are interested.  Much more efficient than taking applications at cafe's and then showing...at least in my area.

Best of luck.