All Forum Posts by: Henry Le

thank you for the great advice everyone! 

So my wife and I are looking to purchase a triplex. When we went to view the property, one of the units has a strong marijuana smoke smell. This has us worried about the cost of cleaning this smell up. It is likely has baked into the walls and HVAC ducts. We are wondering how much will it cost to fix this? will we need to scrub the walls and replace the HVAC ducts which sounds expensive? I am sure someone on here has dealt with this issue before. 

The property is currently all rented out and we are certain that the current tenants in that unit are smoking weed. The current property owner's property management company seems to be ignoring this issue. If we do move forward with this,  i am planning to either increase rent on this unit to help offset cost of cleaning up the weed smoke damage when their current contract expires in October. Or i can just not renew their lease and get them out of the unit by October. How do you approach this kind of issue? i am worry about dealing with existing tenants that will give me a hard time while i honor their current contract. 

Is this a red flag to pass on this deal? So it is three units of 2b/1b. Each unit is around 1200sqft. Built in 1980's. The seller is asking 334k. It seems like a decent deal for 110k per unit. There's room to increase value. Good location as there are new developments near by.

The property is currently net zero cashflow but has potential to increase cash flow up to $500 a month after some cosmetic updating. My plan is force appreciate each unit as the current tenants leave one unit at a time and slowly increase rent. 

I would appreciate any pieces of wisdom!

@Jeff Chisum I looked into this but the loan office I talked to quoted me 7.75% with 1 point plus a monthly PMI . That's hard to make the number pencil especially a newbie like me.

Thank you so much guys for the great insights!! Lots of think about!

So I am looking at other strategies to increase my cash flow and scale faster. STR seems to be a possible answer for me. I know that LTR buy and hold strategy is more secure and proven method to build wealth but I feel it’s too slow for my goal.

STR is looking pretty attractive, especially with the likelihood of return of 100% bonus depreciation this year. With one property, I can generate more cash flow. It will take more work and risk. I understand that it is quite a different beast than LTR. I figure hosting and managing one STR might be similar or equivalent to managing multiple LTR’s and their tenants. Maybe I am totally off and in over my head. I might find myself hating hosting. I am not sure if I want to commit to being in the hospitality business rather than housing business.

I have learned a lot and have a functional system in place with my two LTR’s. I can just continue this process, rinse and repeat with my next investment but maybe if I pivot and add a STR to the portfolio next, I might be a lot closer to financial freedom. 

So far I am looking at northeast Oklahoma specifically lakefront property at the Grand Lake. I love that area and seems to have good tourism. It’s 4hrs from my home in OKC. It’s border to Kansas, Arkansas and Missouri cities.  I see on Zillow properties listing for around 300-450K. 450K is turn key furnished. I haven’t done a thorough research and I’m so inexperience in this STR business, but it appears that the average nightly rates on Airbnb goes for around 200-300 per night at 30-50% occupancy.  I used the free airdna tool for these numbers. My mortgage is probably going to be around $2800 a month. Utilities probably will be additional $400 a month.  Do these rough number look like they might work?

Any books and resources recommendations? Is the paid versions of AirDna worth it?

I am looking for any advice and a sounding board to bounce off my thoughts.

@Stuart Udis thanks for the feedback! Do you mind tell me more why you think my investments so far is not safe and low risk? It's probably not the best way to invest and doesn't get the NOI. Now you have me 2nd guessing lol.

It has been difficult finding deals to cash flow LTR's especially if you are not creative. Currently, I only invest in my backyard in Oklahoma City buying on the market for easy and low risk investments. So far, I am two single-family properties in since last year. They cash flow truly just $200 Per month each. I'm looking for my third but having trouble with finding one that will can flow like the other two. I manage my own properties and I need to find one near my primary residence for ease of repair and maintenance. 

So I have an idea to help increase rent to cash flow a bit more. What if I add appliances such as refrigerator, washer and dryer to attract renters and increase rent by $100 per month? A refrigerator costs about $1000 and a set of washer dryer cost about $1000 as well. After two years, I would recoup the money spent on the appliances. What do you guys think? Is it worth trying to do this for a small increase cash flow? 

Thank you all for the warm welcoming comments and advice! I definitely feel more confident with my plan after reading your encouraging words. I wasn't sure if i am making a huge mistake or forgot to consider certain important detail such as a getting an LLC. I feel like people before me who started out are probably doing the same thing. I said to myself you gotta take some risk to gain some. I saw an opportunity, was tired of waiting for the perfect time and just have decided to go for it. I actually have learned so much of the process ever since I made the offer and got in escrow. That's when things got real and the pressure is on!

Hi BP community! I'm so glad to have found this online community and resource to help me get started on my real estate rental investment. I am a complete novice but wiling to learn because of my interest in this asset class. 

I am currently in contract with a relatively new single family home that looks like might produce some cash flow or at least break even the first year according to the property calculator. It's a 2020 built 3 beds 2 baths. I figure if I start out with a low maintenance property, I can lower the learning curve and decrease the stress of managing a business and rental property myself to allow me time to figure things out as I go along. 

I am getting a fixed rate mortgage at 6.5% with a point. I am planning to form an LLC but due to the mortgage being not a commercial loan, i am not allow to put the house under the LLC. So my plan is to form the LLC later and just take the risk of operating without an LLC and just have landlord insurance and umbrella insurance to start out. Maybe this is a bad idea but this is the only option I have available or see within my limited knowledge so far. I will take any advice the BP community may offer!