All Forum Posts by: Kevin S.

@Colton Looper probably the most common way to deal with that issue is either 1) put in the purchase agreement that one of the units must be delivered vacant, then it becomes the seller's issue to get one of the current renters out (a lot of sellers will push back on this though), or 2) do something along the line of cash-for-keys where you basically buy them out of their current lease. The owner-occupied portion of FHA is definitely a big limiting factor when looking for mulit-family properties in my opinion.

@Daniel Soyars There's a facebook page, tulsa metro area homes for rent where a lot of properties get posted and I'm pretty sure I've seen a couple in your price range on there recently (I post on there when I have an open rental). Good luck!

@Clint G. I'm sure this varies depending on location, but where I'm at there are plenty of quality tenants to be found without using the MLS. When I list a property I've used a sign in the yard, facebook, zillow/trulia, realtor.com, and Cozy. I got the most quality hits from the sign in the yard actually, got a ton of responses on facebook but mostly from people who didn't read the actual ad and were uninterested once they re-heard the details.

I didn't get much traffic from zillow, realtor or Cozy. And in case you didn't know, Zillow recently just started charging to put listings on their site.

Good luck!

@Brandon Wagner no problem, though I would say the order doesn't matter nearly as much as having clear, defined, and lawful rental criteria and sticking to them.

@Brandon Wagner since applicants have to pay a fee when you screen them through Cozy, I use a paper application first. That way I can weed out applicants who don't pass my general criteria before asking them to pay for background check/credit check.

@Zeeshan Mallick equity is the difference between what you owe (mortgage) and the value of the property at any given time. However the value of the property is only truly determined when you get an appraisal, such as when you buy the property or sell it. So, if you are buying a property to hold long-term because you want the monthly income then the house price dropping shouldn't be a huge concern (long-term housing prices have pretty much always gone up, historically). However, if you're wanting to buy a property and then sell it for a profit just a short time later, then this is a large concern. The problem is, no one can predict the housing market (people have been calling a recession for years) so trying to bank on appreciation as an investment strategy is fairly risky unless you're in certain areas (California for instance). 

@Ryan Rice Welcome to BP. A couple things jump out at me when reading through your breakdown. 1) You budget for CapX which is typically big things (roof, etc.) but aren't budgeting anything for R&M (repair and maintenance) so you might want to budget a % for that in addition to your CapX. 2) I'd up your vacancy to 8% if it were me, since that would give you approximately 1 month's rent saved up after a year (1/12 = 8.333%) 3) you mentioned that some of the units smell of animals (urine, etc.) and fixing that plus paint plus any other things to get them in shape is probably going to exceed your $2k budget for repairs, that might be the plus about owner financing, you could decrease your up-front downpayment and use some of that money to fix the units up instead. Good luck!

@Mark Feaver you said "...into how I will go about it when acquiring my first property" above so I'm assuming that you haven't found/purchased a property yet, you are just looking into the issue for the future. Typically if you're purchasing a duplex as a "house-hack" then you're purchasing it with an owner-occupied mortgage. That means you have a set amount of time (I think it's somewhere between 30-60 days) to occupy the property. Remember, you have to honor whatever lease the tenants are under when you purchase the property. Therefore, you have to find a property that either has tenants that are month-to-month (that you can give notice to, how much notice depends on your local laws), who's lease is ending within the occupancy period (that you don't renew), or you purchase them out of their lease (think cash for keys). 

Instead of dealing with all of this, in my opinion the easiest route to go is to stipulate in any offer you make on a multi-family that it be delivered with one unit vacant at the time you close. That way you don't have to deal with trying to figure out who stays/who goes/etc. 

@Aaron Poe I'd reach out to @Deren Huang and get on his multifamily email list

@Robert Duffer Age of the home can deter some buyers, but it all depends on how well the property has been kept up. From an owner's perspective it can also impact how much you need to be setting aside for Repairs/Maintenance and Capital Expenditures. For example, if your property was built in 1970 and hasn't had a new roof since 1985, well you're probably going to need a new one fairly soon and that bumps up your CapX costs and decreases your cashflow. When you go to sell it, how many large capital expenditures are needed to get the property up to a "good" condition is probably going to impact your sell price, if you've stayed on top of R&M and CapX then you may be able to get more, if you've let stuff go and not fixed or replaced things you may have to sell for less.