All Forum Posts by: Jeff Kehl

I don't do inspections all that often because I buy a lot of foreclosures and auction properties as-is but I've certainly had plenty of surprises after purchase. Generally I'd categorize them three ways.

First is things that are hidden that neither an inspector or I could not see. Recent example where I had an inspector was the field lines for a septic system were clogged. Until a tenant got in there and really started using the plumbing we didn't know about it. $2700 later... Not realy a whole lot you can about this I don't think. Just know you'll get some surprises occasionally.

The second thing I would say is time based things where the problem wasn't occurring when I or the inspector was there. Examples of this that have happened to me is flooding during heavy rains, the neighbors have vicious annoying dogs that weren't out and a couple neighbors hanging out in their yard selling drugs. This one you can avoid by visiting the property a lot under different conditions/times if you have the time and inclination.

The third is just me being sloppy and overlooking things because I was in a hurry and didn't do enough due diligence. Avoid this with checklists and discipline.

Why not get pre-approved? It's free and the agents will take you more seriously.

I've had luck recently having the sellers be the private lender on the downpayment. They carry a 2nd note for 10-25% of purchase price. Works particularly well for older sellers who own free and clear or have a large equity position. They're generally just wanting to sell and be done with the property and they like the extra income check each month. I've been paying about the same I pay to banks 5-6% interest but use a shorter amortization generally 5 years.

The house looks good to me. I'd find a good landscape designer and spend money on quality low maintenance landscaping. Add some inexpensive annual flowers and it will pop I bet.

Did you mean $144,000 NOI? I get $187,200 gross rent so you're actual NOI should probably be more like $80k. What utilities does the landlord pay? What are the taxes? What is the $150k rehab based off of?

I just had a dishwasher leak on laminate and am having to replace the entire kitchen floor. Water penetrated it and soaked in. Bowed the floor up really bad. I prefer hardwood, ceramic tile, vinyl plank, sheet vinyl then carpet in that order.

I generally don't install hardwood new because of the cost but I look for properties that already have it.

How many guns do you own?

Do you have a copy of the latest financial statement from the HOA? See if you can find out who the president is and see if you can have a conversation with them. The thing that bugs me with HOAs is not the monthly fee but the potential for 'special assessments' for things they didn't reserve for like redoing the parking lot or drainage issues.

I've never heard of different tax implications for more than 4 units. So unless he can point you to a specific section of the tax code I would say he's clueless. Call him and ask specifically what he meant. Advanced depreciation maybe?

Hi Andy,

On the face of it, it looks like a pretty good deal to me, 1.45 rent to value. Those are becoming harder and harder to find. Couple things for you to think about because I'm not familiar with student apartments like that.

- Are you going to self-manage? If not what are management fees like? 4 students to 1 unit sounds management intensive to me.

- How do the utilities work? Definitely not sub-metered so I'd be curious how they get split between the 4 tenants.

- Is the enrollment at the university they're near growing? Keep in mind a 4 br 4 ba condo will likely always be student housing so if you can't fill it with students you might have a problem. Also, I'd wonder if units like that appreciate much.

-Any new student housing being built or in the planning stages? Call the university housing office and ask what options the students have and how many total units there are available for students.

It would probably help to lookup a few owners of other properties like that in the same building on the county web site. Call them up and ask how their rental is working out.