All Forum Posts by: David Roberts

Hi Brie,

You already have it rented again, unless you stipulated that you would have those refinished for the new tenants, why bother doing anything right now?

 Most people laugh while watching the movie Office Space.  I cry.   That movie is a frickin documentary about corporate life.   And it does just that,  stuck the life right out of ya.

Dont forget to account for city inspections and city fees.  A couple cities here I know of charge an an annual fee for maintaining rental status, and maybe every 2-5 years a rental inspection.   Work that in monthly cost off your cash flow if you havent.  Fees are not profit.

Its tough.   Everybody has their hand out lol.

Property management is almost never 10%.  Its 10% to manage, but add in their tenant finder fee of say half month rent and you are at an effectively at 12% or more.  Some have setup fees also.  Just putting it out there. 

It is hard to be honest, and easy to look past the details. Feel good about yourself for that!

Also like others have said, newly rehabbed houses start with much lower repairs, maintenance and cap ex.  If you start with all new and your selling point is 5-10 years, then you will have to save very little reserves for that stuff.  If you hold forever,  then obviously its not going to be linear,  and as time goes by risk goes up to replace and repair stuff.

I notified them already.   Thanks for the response!

If I have an investor client that gets a HUD offer accepted, then backs out after same day due dilligence (before doing the contract and emd and all that stuff), can he drop his price and submit more bids on the same house after it gets relisted? He wants the house he just thinks after detailed due dilligence hes into it for a little too much.

Thanks for the help.

I hear vinegar works well also.  

will you still have 350 a month with non homestead taxes?  

Primary home conversions are always tough.   They weren't bought with the intent to be investments so the numbers usually don't work very well.  Sorry,  i totally missed the paragraph you explained the 350.

How much did you buy it for initially and how much out of pocket are you on the house approximately? (Down payment, improvements,  etc)

The math says sell it.  Dont ever argue with math.

You said early on in the thread you will have 57/month after taxes insurance and mortgage.  Did you figure the taxes to change to non homestead once you no longer live there?  They will go up substantially and again make you negative before anything at all goes wrong.

But even if you did figure for non homestead taxes, you are going to lose money over time with the cap ex and vacancy.

Taxes will probably go up by more than 57 bucks just from the taxable value adjustment next year,  turning you cash flow negative before you have to fix anything.  Nothing worse than having to pay out of pocket for a house you dont live in.  It gets old really fast. 

If you are in a fast appreciating area, I could see the strategy for waiting a year or two to get more out of it, but then you have to exit. Otherwise you are just losing money,  and whats rule number 1 in investing? Dont lose money!

Dont waste your time.   That's the one thing you cannot recover.

I might have missed it but how much equity to you have in it now? 

 If you have quite a bit, itll be tax free if you sell it before you change your primary address as well.

 What if he could.net 12-15k off of the deal flipping it?  So basically make 5-6 years worth of cash flow in 5 months time.  Would you suggest that he flip it instead? 

It is a good problem to have.  Make more money now or make money over time.   

Im just wonderin.