All Forum Posts by: Jon Kelly

@Bradley Sriro "if you have any open claims insurance companies will not write a new policy." This is simply not true. MAYBE, it relates directly to the insurance company you have an open claim with, but other companies will be able to write a new policy. I would drop your current insurance agent and call other agents until you find the right one. 

You mentioned you have several other investment properties. When you find a new agent, give them the names of the insurance companies that write your other policies (as long as it's not the company you have the open claim against). It's often easier to get subsequent policies written if you already have experience with a company. 

@Troy Jaster Do you know why they are selling? My guess is since it's an off-market deal and you have a relationship with the seller you will forgo the inspection. It's probably worth an inspection, since the rehab is your biggest risk here. Maybe the seller would split the inspection costs.

Seems like you can make $15-25k after taxes and fees in a relatively short amount of time. Not a bad deal. 

@Adam Azam it depends on the area and class of tenant. If it's A-class, you probably want to remove. C-class or below, popcorn ceiling will not be a concern. B-class is the gray area. I would lean towards leaving the popcorn ceiling as long as it's still fresh and clean. The ROI on removing it likely isn't worth it.

@Nathan Raisbeck Any chance you can do both? Try and find a part-time job with a property management company while you're in school. A degree + 3-4 years of experience + a little extra cash will be a very nice combination when you graduate. 

@James Brown What if you give notice end of February rent will increase $250/mo or you will not renew their leases beginning April 1? April/May - rehab the vacant units. June/July rent units with increased rents. 

@James Brown unless you're trying to flip the property, your goal is probably to generate cash flow. If it's cash flowing, why jeopardize it? It always depends on the market, but high-quality tenants aren't always easy to find. 

How far under market are the rents? How much does the renovations per unit cost? 

Unless the rents are grossly under market and the units are desperately in need of rehab, I would lean towards keeping the current tenants in place. 

You could also wait until April/May and increase rents without doing rehab. If they leave, then you can rehab and increase rents for a June/July start. 

@Alessandro Pascucci your estimates provide a quick and easy "sniff test" if it's a good deal or not. This is very useful to quickly analyze properties. You'll be able to analyze 10x more properties than someone entering actual numbers. 

As others have mentioned, it's always better to use actual numbers. The BP calculators provide a breakdown of expense categories. 

Maybe you use your criteria to identify which properties you want to schedule showings for. Then, use the actual numbers prior to making offers. 

@Eddie Ward that's quite an accomplishment, congrats! What's even better is you took action and bought a property before finishing all of the podcasts. I'll bet it becomes a lot easier to apply lessons learned from the podcasts now that you are a landlord and well on your way to accomplishing your goals! 

@Richard Fish What does your lease say? Most leases contain language for breaking a lease or early termination. I'd consult with a local property manager or lawyer, but if the lease is silent on the topic, in PA the tenant may be responsible for the remainder of the rent throughout the term of the lease. If you rent the unit prior to the end of the term, the 1st tenant is only required to pay the rent that was lost 

@Sam Morgan, I completely agree with @Will Fraser and think this is a "NO." Including PMI, what is your adjusted mortgage rate, low 3%?

A quick way to answer the question about the refi is, can you use the $57k to earn more than your adjusted rate (e.g. 3%)? 

Another way to answer the question is running the analysis with +$57k and no PMI. You monthly cash flow increases, but your CoC is cut in half.

You have a great house hack that returns 10-25%, and I imagine you can use the $57k to find a similar opportunity out there. Congrats and best of luck on your next one!