All Forum Posts by: Ika Sargeant

Yikes; additional cost in maintenance. 

You will have a pool of renters who not want a house with a the pool either because of young kids or maintenance cost to them. Pools in our area can be expensive. If you are starting out I think you might want to sit out this one unless of course you are seeing a lot of value in this location. 180K for a SFH in Alexandria would be enticing.

It might have sold at an auction at some point but what you are seeing is really property that gets marketed, does not sell, gets pulled off the market and then its put back on the market a few months later. This is pretty common to see on MLS.

You are welcome Samantha. Yes learning by doing works for me. Good luck.

When you purchase a home as a primary residence you have stated your intention to occupy the property as a primary residence for at least 12 months. Yes do check with your lender and the check what the rules are in the state where the property is located. I always tell my buyers to take this requirement very seriously.  Most think its harmless to skip after a few months and rent the home; this is considered fraud.

I would suggest while you are putting things together with your partners start learning to analyze properties and learn the basics.

Pick a house/duplex you might be interested in and learn about what price you could offer and why, getting financing and costs associated with buying and lending. If you are buying to hold; learn the rentals in that market, learn about costs that are going to come with owning, determine if you will be making money or losing money, learn about the basic ratios used in real estate such as return on investment, cash on cash and why they are used. So go ahead and soak up all the information shared here but try applying it even if is just practice. 

The cost of flood insurance is often too high, and I imagine you will have a harder time making money.

If you buy it, you also have a harder time in the future unloading it because future buyers are going to bring this same issue.

Flood issue is a deal breaker for me.

This warrants a further investigation. I would also ask the homeowner if this is an ongoing issue because he is talking about taking care of one leak and now another one has appeared. Absolutely find out what is causing this repetitive leaks, is it a foundation issue? Is the water seeping in from the standing water near the property, or poor drainage. Get a good contractor to look at this and give an estimate of what the cost to repair will be. I would even check insurance claims made on this property, ask for a CLUE report. 

I agree with Chris Coleman that determine what is worth  for you in terms of the cash flow from this house. You just mentioned your mortgage but no other expenses such as HOAs, taxes, insurance, maintenance and more. If you end up with CF of $100 a month after all expenses are accounted for; is that worth for you?? May be your money could produce better results somewhere.

The second thing to consider is to review your local real estate market and project what the value will be next year through 5-10yrs. You should also project the rental income and your costs too. For simplicity I would use the  5 year average growth rate for your area. An area with a high appreciation or great demand for rentals will mean your numbers improve every year. I always ask myself why should I keep a house in this area for blank number of years and then I start with the economics of the area as well as the real estate trends.

Did you have a buyer representation agreement with the realtor? If you did then, its a underhanded how she went about it.

Trying to make that same decision; use a HELOC or go with hard money lenders. I find the rates for hard money lenders

are too high. In my opinion the costs are rather high and may put your deal at risk. If you have a couple of challenges during the rehab or if you are flipping, then you can get into real trouble.