All Forum Posts by: James Mc Ree

The link below goes to the PA Landlord Tenant Act of 1951.

https://www.thelpa.com/PA_landlord_tenant_act.pdf

I believe this is the current act, but check for amendments.

I can't help you with legal advice as I am not a lawyer and I am in PA, not familiar with CA law.  Here is some neighborly advice instead.

I would not make my first move to be calling a lawyer.  I would give my new neighbors the benefit of the doubt that they were looking out on this unkept land next to them, that has probably been that way for a long time and getting worse, and trying to make the best of it.  Maybe they thought it was open space, wild land, owner didn't care - maybe was dead, etc.

Instead, I would introduce myself to my new neighbors as the new owner of the land "next door" and talk with them about my plans for the property.  I would ask them if the neighbors had used the land for anything in the past and let them know that I would be using it now and politely ask them to respect the boundaries.  The gates wouldn't bother me as they can be great for transit both ways if we built a house, were living there and befriended our neighbors.  Kids are great for that!  The gates will be better than climbing fences.

My 2nd step would be to post "Private Property - Do not Trespass"-type signs and call the police if the neighbors do not respect the property.  The police support is "free" and they can issue an order to stop the trespass.  Your neighbors could end up in front of a judge after several of those citations.

Lastly, my non-legal PA advice: the lawyer might be useless.  Think about your goals in a lawsuit.  If it is to stop trespass, the police might be a better route as trespass is more criminal than civil.   It is hard to show civil damages just from trespass. Restitution for lost tree property damage could involve a lawyer, but might be challenging if you don't have much appreciation for your lost trees (just reading into your post).  You could do it yourself in small claims court and might spend more on the lawyer than you get in damages, though you could sue for legal costs too.

Good luck!

I agree with the above posters and like the idea.

I just did in PA what you propose.  I found my bank to be very slow: I completed the application and supporting docs over a month ago and they have yet to schedule a date for closing, even after repeated requests.  I think a traditional purchase with a mortgage and closing scheduled with an agreement of sale forces a completion date, but refinances with no due date might not be a priority.  You might want to try to negotiate the closing date up front with your application if you can.

The second challenge I ran into is the bank told me not to apply for any new credit while they conduct their underwriting or it would mess up their numbers.  That creates a problem as I couldn't get a refi closing date and wanted to buy a new property with a mortgage contingency, but couldn't apply for the mortgage until my refi closed. This won't be an issue for you if you wait for the closing.  I ended up buying the property with cash and closing a little over a week ago.

Your current property that you plan to cash out may be subject to a "seasoning" period of 6 or 12 months with your lender if you recently purchased it.  Lenders have different seasoning time requirements.  Mine (the slow bank) charged 0.125% more for less than 12 months of seasoning.  I am awaiting 4.875% fixed for 30 years, no points.

I plan to do this again with the property I just bought for cash, but would plan better next time.

Good luck!

Jim.

I had a real estate interest for the past 20+ years, but only acted on it starting in 2013.  I am a buy and hold investor with 4 properties.

My property purchases are either 25% down remainder with residential mortgage or cash buy + rehab, then refinance with 25% down and residential mortgage.  My current inventory is:

Year purchased - brief description
2013 - 3/1.5 Interior row home with unfinished basement and no c/a for $67,000.  Renting for $1,200/mo.

2013 - 3/1.5 Interior row home with unfinished basement and has c/a for $80,000 right across the street from above.  Overpaid, but it looked like it was in good condition.  It actually needed a new room and a good bit of bathroom work.  Rent is same.

2015 - 3/1.5 Interior row home with finished basement and c/a on same street for $48,000.  $30k rehab (overspent).  Same rent.

2016 - Bought on new street, same town for $72,000.  I just settled a couple days ago.  Minor rehab is underway.  Planning to rent for $1,250.

My plan is to buy 1 property per year and hold for rental.

I am also getting involved with CrowdFunding real estate as a way of diversifying out of location and single-property risk, while also possibly getting good returns for less work.

You could add something like this to your ad:

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For the protection of all interested tenants, I will always meet you at the property to show it to you and will never ask for money to see the property.  Any requests to do otherwise are from scammers.

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Something like that might keep the shadow off your property and reduce fraud concerns among your prospective tenants.  You could also include a link to Facebook, LinkedIn or your other favorite social media so prospects know what you should look like when they meet you.

Jim.

@Tom V Why do you want to invest in real estate?  Naturally, everyone wants to make money, but it appears you have a time conflict: your growing business potentially versus your real estate empire.  You should think about the extent to which you are willing to make that tradeoff and what impact on your business you are willing to accept.

I think there is tremendous value in understanding real estate rental operations with your first or first few properties.  Outsourcing all of that means you could learn nothing and become a hostage to your management company.  For example, you can replace a gas water heater for $900 or $1800 depending on who you call around my area.  It will be the same water heater, same warranty and both jobs will be done well.  Which company will the PM firm call?  Is it the same if they get a % of cost?

You have probably read that real estate investing is really all about people.  Good tenants = good experience, bad tenants = something else.  What will your PM firm do for you besides provide screening data?  Does the firm select the tenant or you?  If the firm selects, do they provide a rent or tenant guarantee?  If you select, you need to decide what to do with someone with spotty credit, past drug use and a low credit score.  Screening data is cheap.  Good screening is invaluable.

Thinking only in terms of money, I think of real estate investing as a bond investment that requires a lot more work than a bond and is sometimes unreliable (vacancy).  You hope to get a steady rent with some steady expenses to obtain an annual yield.  You might want to consider a more passive investment if that is the extent of your desired involvement.  CrowdSourcing real estate might work for you in that case as you can still pull 9% or more with debt, or more with equity investments, and you can diversify yourself out of single property and your local area risks.  You are definitely hands-off in CrowdFunding.  A downside is you have almost no connection to the property and it can be a lot less fun!  8-)

Good luck!

Jim.

Sage Premier Settlements
http://www.sagetitlegroup.com/sage-premier-settlem...

I just settled a transaction with them yesterday.  All went well.  They've done an additional 4 prior titles/settlements for me in the past 4 years and I've had no issues with them.  I can't compare them to other companies, but did have a good experience.

The office I went to is in Broomall, a little east of Philadelphia.  It is their company HQ.

Good luck!

Jim.

The unit currently has window units and forced air heat.  Window units come out.  New c/a in.  The return ducts that empty into the basement are extended to the furnace and a/c which are on the other side of the basement.

I am buying the property for $72,000.  Most similar properties in the area are selling around $85,000 with central air.  Many of those have fully upgraded kitchens which mine lacks.  Mine is more of an "upgrade in place".  I am adding some cabinets to avoid a kitchen remodeling.

Jim.

I settle on the unit Thursday.  It already has a finished basement.  My improvements were replacing the furnace, adding c/a and adding duct work to bring basement returns back to the furnace and a/c.  The returns just empty into the basement and we need them to connect to the furnace and a/c.

The old furnace still worked.  I thought now was a good time to replace it since I wanted to add c/a and a new furnace would require ductwork for the returns to comply with code anyway.

My spending drivers are improved resale value and rent competitiveness, as suggested above. The seller is motivated and price below market in a nice area. The ROI for the c/a is 2 years or less. It is harder to assess for the furnace since I don't know when it would actually fail. Murphy would have it fail at the worst possible time giving me some stress ROI too. 8-) Otherwise, I don't think a tenant cares if there is a new or old furnace if they are warm.

Jim.

I am about to replace a 1950 gravity gas heater with a modern unit, add c/a and do a little basement duct work to a unit all for $5,800.

Around here (Delaware County, PA - near Phila), a "3Br, 1Ba, unfinished basement and no c/a" is the "base unit" for the row homes I buy.  Upgrades add a powder room, finish the basement and add c/a.  The base unit typically rents for about $1,000 - $1,100 while the fully upgraded unit rents for about $1,200 if you can ignore everything else that affects value for an over-simplified comparison.  That is very hard to do.  Condition, location and maintenance needs are very important.

One tenant factor you may run into is the affordability of c/a.  Lower income tenants may not be interested in c/a as it will increase their electricity bill and rent if you charge more.