All Forum Posts by: Fran Flanagan

Unless you're planning on a sugnificant rehab, I think I'd try to negotiate very free access to showroom new tenants at reasonable times etc. I'm sure that you have to give done notice to raise rent.

So 4 months at 15% more or maybe one month less vacancy. I'd rather have the quick turnover. Could go for both but raising rents 15% may not sound appealing to new prospects.

I think the 50% is supposed to include the taxes and insurance. It's just a ballpark, if you're getting good rent or high demand / low vacancy for example, it could easily be more like 40%... Which it sounds like you may have here.

If it was month 5, I'd think maybe something came up. Month one, my BS meter goes off. They are definitely testing limits IMHO.

I would talk with them in a friendly way. Let them know that the late fees and that you'll need to post the notice on the 5th. Ask them if they'd like to change the timing of the lease as others suggested.

Definitely talk to a CPA. Based on your situation, not collecting rents, using it as an in-law suite, you likely can take up to 500k profit without the 1031 exchange. (No legal / tax advice here, talk to a pro).

Based on the numbers, I would sell. If you take out ~ 400k from that, you'll have 100-150k for a downpayment on a nice house and a nice amount of money to either fix up the new place or invest as you choose.

From what you've said so far, tying up 400k of equity in this as a rental sounds too risky for my appetite. Also, if you consider your mortgage, taxes, insurance and expenses, perhaps you'll make 10k year in profit. With all due respect Amit, I don't think that 2.5% cash on cash is "cashflowing like a ****"

There are safer and easier places to earn the same 2.5% return... or you can get a different piece of real estate and likely do better thatn 2.5%.

I have no experience personally with section 8, but I've spoken with several other landlords who rent properties in rough areas where the section 8 rental represents a significant premium to what a free market price would be.

For example In Norristown PA, a nearby not good area, section 8 will pay $1300/month for a 3-BR, whereas free market in that area would dictate something closer to $700 perhaps.

Paying for tenants is likely on the edge of legality, but I can understand the motivation.

We did the same thing. While you may have no obligation to tell the bank, you should check with your insurance company to make sure that you carry the correct type of insurance for tenants living there.

(No legal advice)

If you came to my home and gave me a new roof, free of charge, I'm struggling to think of how I would "get even." Wash your car perhaps?

Some people just think everyone is out to screw them in some way. As any poker player can tell you, people are illogical.

I'm very curious as to what you proposed doing to the property that elicited this reaction.

I would be fine holding it a month provided that they put up at least a Month's rent now and signed the lease. Then last months rent and security due the first day of the lease when you hand over keys.

I would consider January lost but would try to get them to start Feb 1rst, considering your position though, I wouldn't go nuts over it. Maybe give them a discount for Feb if they start on the first and move utilities to their name at start of month.

This reminds me of a conversation with my buddy who had bought a bunch of extra tickets to a sporting event. Demand wasn't what he'd hoped, he said he didn't want to lose money. I asked him "Do you want to lose a little bit of money or a lot of money?"

Let him know that your offer is more likely to go down than up as time passes and rates rise (even if you're paying cash).