All Forum Posts by: Joe Chirdon

From my personal experience, I'd recommend checking out these two local meetups. Lots of knowledgeable people attend.

https://www.meetup.com/Central-PA-Investors/

https://www.meetup.com/LIMG-Harrisburg/

I agree, get him/her the notice to quit asap. Also, If the tenant is month to month, or the lease is expiring soon, I'd add a late fee clause that is in line with your state's laws. I've had tenants that decide the want to pay mid-month every month. The late fees can really add up. I usually charge 10%, if it's more than 5 days late. 

If your not too concerned with cost, I'd check out McNees. They have corporate and tax specialists. 

https://www.mcneeslaw.com/practice/corporate-tax/

https://www.mcneeslaw.com/practice/real-estate/

If you'd rather talk to an accountant first, I'd recommend Lisa Acri. She helped me do my 2017 taxes, and I wasn't audited!!! You can google her info easily.

I bought a triplex 2 years ago with my then girlfriend now wife for $70,000. We used traditional financing and put 20% down. It needed a lot of work, but at this point it's mostly stabilized. We live in the biggest unit (1st floor) and we rent out the basement and 2nd floor units. The rents cover the mortgage and utilities and some months we even have a little cash flow!

The only real downside is that the property is in Harrisburg PA, in a rough neighborhood. But for now we're satisfied with the experience and the savings. 

If you're ever in the Central PA area, I'd recommend checking out the local meetups. Lots of knowledgeable people attend. 

https://www.meetup.com/Central-PA-Investors/

https://www.meetup.com/LIMG-Harrisburg/

Deal: 

1929 brick 3-unit (all two bed one bath units) on .38 acre property in C to C- neighborhood. I closed the deal in late February.

Purchase Price:

$70,000 (20% down and 4.6% 30 year fixed rate mortgage). It was listed at $100,000, but my agent suggested making a $70k offer, and it was accepted w/o a counter-offer to my surprise. I later found out that the sellers were motivated b/c they were getting divorced. I should have offered 65K lol...  The property appraised at 80k at closing!!!

Details: 

The property needs work, mostly cosmetic and landscaping, and I'll have to spend a few thousand on new furnaces, roofing, and other miscellaneous fixes over the next year or two. It came with two existing tenants who aren't ideal, but they have paid rent on time....so far. The previous landlord set their rents super low, i.e. 525/mo and 455/mo. The one tenant has lived in the top unit for 22 years! My GF and I moved into the third unit, which was vacant and needed the most work.  We're slowly improving it, mostly on our own. Gotta love sweat equity. The 525/mo lease ends in a few months and I think I'll bring him up to 650ish/mo. I might raise the rent on the 22 year tenant too, but not much b/c she is so reliable and quiet. 

Based on my numbers the property is costing us about 500/mo after all expenses/tax/etc....However, my numbers indicate that if I eventually move out and get all three units up to market rent (i.e. 700/mo), it should cash flow $600/mo or more...Not bad in my opinion.

Thoughts...?

Thanks Christian, I'll try to make next month's Carpoa.

Debbie, the average market rent is roughly $700-750/mo for 2 bed one bath in the area. They have been there 4 years @ $610/mo with no rate increase. Thanks for the advice!

Thanks Edgar! Glad to hear it has worked for others! I was thinking about bumping the rent after I get a working washer and dryer (for the basement to share with the tenant). The tenant has been using the local laundry place. It's funny, the basement has 5 washers and/or dryers, 2 of them are even hooked up, so I just assumed they worked...WRONG lol

Hello BP Community,

Last week I closed on my first property! It's a nice 1960s brick duplex in Harrisburg, PA's mid-town area. I will not be cash-flowing on the deal, as I will be living in one of the units, BUT I will be paying less than what I am currently paying in rent ($800). I bought the property for 68k. It's in pretty good shape (basically turn key, with one long term tenant). I'd call the neighborhood "-B".The 30yr/FHA mortgage is going to be roughly 700/mo. The tenant is paying $610/mo, which I am thinking about increasing to $650. Plus my GF is going to pay utilities! At the end of the day, hopefully I'll be saving roughly 300-400/mo over what I was paying in rent.

It's a bit overwhelming though; my list of tasks includes:

Setting up billing for water, trash, electric, gas;

Cleaning up the gutters and the yard;

A fresh coat of paint and re-staining the hard wood floors;

Sanding and painting the deck and railings;

buying a new washer/dryer and

Figuring out how to approach the tenant about a rent increase.

Anyways, I know it will be a positive learning experience and hopefully be the beginning of a successful real estate investment career! 

-Joe C