All Forum Posts by: Jeff McCaskey

just let it go. I've had that said to me many times, mostly I can tell they are poking fun at me about it, but if you stop for a minute you migh wonder, so I don't stop for a minute so it won't sit in my mind. I know I do the best I can at any given point in time to make the best decision and it's usually not what's best for my pocket book but what's best for the tenant, future tenants, cost wise, the asset or order of operations (is the elec infrastructure present to support HVAC vs window air etc. etc) then it's about my pocket book. I just know if I do a good job then tenants are happy, units rent or stay rented, asset increases in value and I will be part of the win win in there.

You bought em, so run em, make a difference, and be happy!!

@Ashly B.

Couple things.....

1) great you want to change the tenants you attract. I have a property in much the same situation you do. Question, how will one young professional like living around several who have dogs urinating all over the place??? Think you might need to do enough upgrading to get out of the bottom tenant class to graduate a notch with the property. Just an opinion. Or an if possible financially comment.

2) if your furnaces are from 1984 or that far in the past era-ish, new units today use a different coolant and I understand that they old/new are not compatible with one another so adding a brand new ac to an antique furnace probably won't work from the very start which means you're looking at a change out period. Without changing any duct work etc etc, just changing out furnace and adding ac in my area runs about 5k without any discount. I'm a bit surprised nobody earlier mentioned the coolant aspect here. 

3) You might be able to find some used units to buy on the cheap - sometimes people install units and soon after decide to upgrade or build an addition etc etc so you might be able to find 1-2 year old stuff for half price to save $ going in. Even finding one or two of these could pay off.

4) something else to possibly consider are units made by Mitsubishi. They are called inversion units or to that effect, term escapes me right off hand. But they are super quiet and very efficient and are less $ than central HVAC. See if you have a dealer in the area and look into options.

love what George P. had to say!!!!

Seems to me that making a biz plan sounds like a good professional idea and may work for some people in some ways but honestly....... In many ways seems like a waste of time overall. How will you know what opportunities will come up in the future and if you will jump on them or not...???? What will you do, say "oh I can't do that because it isn't in my biz plan", or "gee this is a screaming deal but before I get this deal under contract I need to change my biz plan again so I know what I'm doing"??? Answer is NO!!! 

Define some direction to start out in, one that's comfortable, know what you know and know what you don't know, and start figuring things out. Get a deal under your belt, redefine things, then pursue another deal. As a person matures as an investor different paths will appear and either be passed up or followed depending on where a person wants to go and how they want/can get there. I don't see how plans mean shi..... I make plans all the time, daily, and then the natural course of events tends to dictate how closely those plans get followed - they don't last very long.

Goals on the other hand are great!

@Ashley Warnhoff

The only advice I can provide would be that whether renting or selling

1) use earth tones as they tend to be appealing to many and still neutral enough to allow people to coordinate belongings in a way that will most likely work for them to some extent.

2) Choose the same set 2-3 colors you can use on exteriors and interiors from project to project so that touch up work doesn't turn into a re-paint and so when you have paint left over at the end of one or another projects, you can save the excess and use it again later on another unit - saving $.

Hope that helps......

I would just add to make complete lists of work and associate deadlines with them and, someone, should be there - off and on at least to keep the pressure on and to quickly make decisions as to changes or options that arise in the process. Throw on a tool belt for a day if you have to to keep moral up. Rehab can be long and tedious and many parts of it just frankly "suck" and aren't very exciting. Maybe show up with lunch a time or two. Anything to spur on the men there in the trench so to speak. Hands off doesn't seem to work unless it's a highly professional crew with a distinct and true leader.

Use a contractor, not an inspector......

@Taylor Harrison

I bought one just like this a few years ago. I had some challenges starting off with some neglected repairs and diy stuff that was poor quality work. However my purchase price was nearly the same.

I don't know your market etc etc, though I believe we are similar in what we would both own if you make this purchase. Today that property is one of my best properties as far as cash flow is concerned!!! I'm still updating the units a little at a time.

IF I WERE YOU, sounds like you've done your research already, I WOULD BUY THIS PROPERTY.

Obviously you need to make sure you do all the due diligence possible and check and recheck numbers before you say yes, but you have looked at multiple properties by now in varying conditions and you know this will make money. Make an offer!!

As far as creative financing goes, I had no money when I bought mine. So.... I did a lease option. 3 years, $8,000 down (borrowed from family), high payment of $1,000 per month, balloon payment after lease was up.

So I cleaned up the yard and did a little work here and there and saw the value of the property rise quickly. It's worth 85k or better now. Making that high payment might sound odd to some people, however I knew I didn't want to come up with a large down payment after 3 years for financing - so that payment created huge equity for me fast, and when I went to the bank I already had my 20% in equity thus no down payment required! Actually equity was more like 50%.

Other bonuses you've likely got going for you are tenants in place with appliances in the units and as you stated - a tidy property.

One thing you can do should you choose to be ok with this school of thought is to only insure the property for the debt against it. This is a rental, not primary residence. I do this with mine, all of them. Your $1,500 a year will become $400 and the debt against the property is covered by your policy. No you won't get full replacement value if it burns down, but it's a rental. If it is ever destroyed (not likely) then clear the lot and build new or clear the lot and sell it to a neighbor, then move on to the next deal. 

I assume this property might be 100 years old if it's like mine. So check the big ticket items carefully and make sure they are at least functional at the moment. One area you will likely be able to reduce costs is with utilities - so check the attic insulation depth, if it's skimpy then blow in another 8 inches or so and rest assured you will cut the usage rates significantly.

If you want more details or info/pointers get my number off my profile and call or text.

Best of luck to ya Taylor!!

I hear what you're saying, however this is a tax auction and a just a tear down. That's it. It's all junk that needs to go for new construction to start. All utilities will have to be redone etc etc - just a tax sale and a tear down boys, or in other words, just another day in the life.

@Michael Woodward

I'm going to one on Monday to purchase a specific property that was listed in the paper. I know what it is and what I intend to do with it so I feel I am at no risk what so ever. I would agree, perform required diligence or be ok with the risk. Knowing your area well you should know by the address and block number what you're dealing with even if you e never seen it before. Or just don't buy that property. In my case it's a tear down and I am fully aware of that - hopefully it goes cheap cheap cheap. I expect it will.

@Tracey Armstrong

I've never done any direct mail, I started out with buy and hold. It took me 10 months of actually looking to buy before I actually was able to buy my first property. And that was on lease option, not an all cash purchase.

Go and go hard, refine as you go, don't quit......

Don't be afraid to try a different strategy if you get to that point, if mailing doesn't pan out, you can employ a totally different path in real estate. It all depends on your drive and determination!!