All Forum Posts by: Kyle Penland

Emotionally attached. See if you can find out why and use that in your favor... For example was she raised in that home? What does she like best about it? Worst? Then use it to your advantage in talking with her. With emotions that high she isn't selling anytime soon sounds like for anything less than what she feels it's worth. Let a few more people low ball her, get on her good side with brownies cookies, maybe even a gift card to a restaurant for lunch or something... and you'll win out on the end with great reviews from her and the property. I'm doing the same thing locally with a duplex that was owned by the sellers father and it hasn't been occupied in years. However she is married to it. I offered to take her to lunch and we could discuss further but hasn't taken me up on my offer yet.

I think your repairs are too low. You should be at 10% for that and even though you plan to manage yourself you still need to figure 10% management because it's taking your time.

If you are paying them by the hour instead of by the job I could see this. I pay my folks by the job and we both have an understanding how long it should take coming from them not me and I'm able to hold them accountable by their measures from the get go. If you feel the need to babysit your contractor maybe you need to find a new one? Just my thoughts...

I sold my last house fsbo. I also called every top realtor and offered a 3% commission if they sold my property. It's a small town by the way. I still ended up selling it myself without a buyers realtor. It was easy. We got a contract from the closing attorney and that was about it from my end other than letting the appraiser in and also getting a termite inspection. Simple process.

It just eats in to your profit and the major negative is they can vote to do major repairs and you fit the bill and nothing you can do about it. For example my first flip where I fought the HOA AND LOST was awful. My mortgage was 550.00 ( I was in college and had no money) and then HOA voted to paint the buildings, and do work on the pool. It changed my HOA from 295.00 monthly to 595. For three months. If that happens to you in this deal, you will be cash flow negative. Just a bad experience that I had and it influenced me forever.

Maintenance, vacancy, and pm at 30% (10% each) 900.00. 750 mortgage, 1050 tax HOA and insurance... Leaving you a 300 dollar profit. Personally I will not look at a property with an HOA. All depends on your goals and what'll you want out of it.

There was a post on this with interview questions not too long ago.

I would add the storage to their rent and pay the storage yourself. You won't know if they dump it in a storage unit and then that unit gets auctioned off for them not paying. I also would not store it in my own garage or allow them to store it in their garage. Too many things that can go wrong with that.

It all depends on your goals...Do you want to be a landlord or flip properties.  My advice is that your rent doesn't look high enough.  1% rule but that is a guess since I don't know all the external variables that will go into that.  Get a quote on Tax, Insurance, run the numbers again yourself and then throw it out to the group with definitive numbers for the buy and hold strategy...If buy and hold doesn't make sense, then sell.

I have a buddy who did this...They bought the most run down they could find, put a couple grand in them, and "rent to own" and usually got  pretty stable tenants out of them.  Made their initial investment back usually in a year.  They can work well if you are handy and manage it yourself.