All Forum Posts by: Larry Brown

In Syracuse, I recommend that you get in touch with Dante Belmonte. He has been both my friend and real estate agent over the past several years and has helped me and several of my friends both buy and sell investment properties in the Syracuse area. He is very knowledgeable about the Syracuse market and would be a great person to have on your team if you are looking to buy in Syracuse and the surrounding area.

I put this in another post but will post it here as well - 

Please write your senator (and assembly person) letting them know the damage this will do to your real estate business.

Below is a letter that I have emailed to my representatives as well as to all of the co-sponsors of the bill (note - I have deleted my numbers in the letter below) -

I am a small-time landlord (total of ___ properties consisting of a total of ___ units) and the majority of the income that I live on comes from my rental properties. I am deeply concerned about Bill #S8125 that suspends/waives rent payments for those tenants who have lost their jobs because of the current COVID-19 crisis. If tenants do not pay their rent how do I pay my bills?

Over the past three years ___% of my gross rents have gone towards expenses associated with my rental properties.

My expenses associated with the rentals include:

• property taxes (__% of gross rents),
• insurance (__% of gross rents),
• repairs (__% of gross rents),
• utilities (__% of gross rents),
• mortgage( __% of gross rents)
• property mgt (__% of gross rents)
• other (__% of gross rents)

After expenses I would be left with __% of gross rents. This is what I would be living on as my major source of income.

Rather than suspending/waiving rents for those tenants impacted by the COVID-19 crisis I recommend that New York state issue rent vouchers to cover the rent payments of those impacted.

One additional note - If you own rental property in New York state this impacts you. Not just New York City, but Syracuse, Buffalo, Rochester, Albany, Schenectady, Utica, and everywhere in between.

To all landlords and real estate investors in New York State - The state senate is currently considering a bill that would waive/suspend rents for all tenants impacted by the corona virus. Senate Bill S8125A states that any tenant impacted by this virus would not have to pay rent for the next 90 days (and would never have to make up those payments).

Please write your senator (and assembly person) letting them know the damage this will do to your real estate business.

Below is a letter that I have emailed to my representatives as well as to all of the co-sponsors of the bill (note - I have deleted my numbers in the letter below) - 

I am a small-time landlord (total of ___ properties consisting of a total of ___ units) and the majority of the income that I live on comes from my rental properties. I am deeply concerned about Bill #S8125 that suspends/waives rent payments for those tenants who have lost their jobs because of the current COVID-19 crisis. If tenants do not pay their rent how do I pay my bills?

Over the past three years ___% of my gross rents have gone towards expenses associated with my rental properties.

My expenses associated with the rentals include:

• property taxes (__% of gross rents),
• insurance (__% of gross rents),
• repairs (__% of gross rents),
• utilities (__% of gross rents),
• mortgage( __% of gross rents)
• property mgt (__% of gross rents)
• other (__% of gross rents)

After expenses I would be left with __% of gross rents. This is what I would be living on as my major source of income.

Rather than suspending/waiving rents for those tenants impacted by the COVID-19 crisis I recommend that New York state issue rent vouchers to cover the rent payments of those impacted.

Here is a portion of the bill - 

Section 1. (a) Notwithstanding any other provision of law, rule or regulation to the contrary, any residential tenant or small business commercial tenant in the state that has lost income or has been forced to close their place of business as a result of government ordered restrictions in response to the outbreak of coronavirus disease 2019 (COVID-19), shall have all rent payments suspended for ninety days following the effective date of this act. Such residential tenant or small business commercial tenant shall not and shall never be required to pay any rent waived during such time period.

I have been an investor in Syracuse since 2004. I recommend you get in touch with a friend of mine, Alexis Bliss, who is a real estate agent, real estate investor, and member of BiggerPockets. You can search BiggerPockets and find her contact information.

Regarding making $500/month after expenses that may be a challenge depending on how you are defining "expenses". When I run numbers on a property I include the following for expenses: mortgage payment, taxes, insurance, utilities (at least the water bill), repairs & maintenance, cap x, property management, vacancy, and possibility lawn care/snow removal as well as other utilities (heat & electric). Based on the properties I am seeing listed at the present time I believe that a more reasonable cash flow/month figure would be around $125 +/- (if you include all of the expenses I listed).

I have owned several properties in the Syracuse area for 14+ years and I believe you are missing several things in your numbers and several numbers are on the low side - 

1. You did not include vacancy rate in your calculations (I use 5% vacancy rate).

2. You did not include property management expense. You should include it even if you are planning on initially self-managing. I recommend 10% for this expense.

3. Based on my experience, you should increase Repair expense and Cap X expense to at least $100/each per month ( I would be more comfortable with $150/each per month).

4. Who is doing lawn care/snow removal? I did not see any cost included for those items (where I provide snow plowing it costs me around $500/season, I cut my own lawns but paying someone would probably cost at least another $50/month during the lawn mowing season).

5. I believe your insurance cost is low. If you want replacement cost coverage your monthly cost will be around $100 or more (again based on my experience). If you only have insurance based on the purchase cost you are going to be severely underinsured (talk to your insurance agent on this one).

Rob - Do you have any scheduled speakers at the BP meet-ups or is it mainly an opportunity to meet people one--on-one?

I have three 2-family properties in Syracuse. My actual expenses for taxes, water, and insurance are a bit higher than the $4000/year you mentioned. My expenses are closer to $5000/year for taxes, water, insurance (I do not pay for electricity). Taxes alone are $3000 for one of my properties (assessed value of $57.5k). Are you also paying for the heat? What is the condition of the roof, furnaces, water heaters, and any other big ticket items you may have to replace in the next few years? Are you going to be paying for lawn care and or snow removal? You may be able to get more for the rent. I am getting $800+ for my 3-bedroom apartments (again, without electric included).

My roofer does guarantee his work but I don't recall the specifics of the guarantee. I guess I can't post his contact info on this link. If you can send me a message I can give you his info (assuming you can actually send me a private message, I'm not sure how that is done).

As far as the cost for the new roof, it depends on how big it is. I have replaced several roofs on my multi-family properties in the Syracuse area over the past three years and have generally been paying around $450/square (that includes complete tear-off of the old shingles). 

Is it really necessary to replace the entire roof at this time or can you repair a few leaking places and hold off on the cost of the entire roof until you can come up with the money without borrowing it? If the home inspector didn't point out anything major than either the home inspector is not doing his job (and I would never use him/her again) or you really don't need an all new roof and kitchen.

Regarding the cost of the kitchen I generally pay less than that but I also usually work side-by-side with my contractor so that reduces my labor costs. I have bought decent kitchen cabinets at the local Bargain Outlet.