All Forum Posts by: Luan Oliveira

@Khaled Eissa the most reasonable policy is one you're comfortable with.

Make sure to have a pet addendum, listing responsibilities. Biggerpockets has it in their lease package.

Also, it may be wise to require then to have renters insurance and list their pets on it. Even Yorkies can chomp at legs some times. Additionaly, You may want to verify the breeds, and make sure your insurance has no restrictions.

Hi Olivia,

I HIGHLY recommend you call the zoning department or going in person to check to see if it's a legal 2 family. Don't rely on what the assessor's database says. The fact that it has only one set of utilities leads me to believe it may not let legally a single family per zoning, but I could be wrong. Anyways, it's always good to double check. 

As for billing tenants, you're probably better off just charging higher renta to offset the costs. 

Quote from @Edwin Aguilar:

@Luan Oliveira  We've considered East Providence, East Pawtucket and Cumberland. My wife and I aren't as familiar with Rhode Island. Would you be able to speak to the areas to avoid (in terms of crime rate)? Thanks for the insight regarding the proportional down payment and offering workable suggestions to sellers! That's good to know! 

Honestly, your best bet is to drive some of the areas and get a feel for them. Everyone's tolerance for crime is different. There definitely are some areas where you drive by and can get a sense that it's not the greatest neighborhood. Others are just working-class neighborhoods. At the end of the day, most crimes you'll see are targeted and not random, and they'll also happen in the best of areas. The areas with more crime are most likely going to be around Providence/Pawtucket. Areas like Federal Hill/West End/Mount Pleasant also have some really nice areas. Of course, there's the East Side of Providence too (not to be confused with East Providence), but that's a whole other world!

Quote from @Edwin Aguilar:

@Andrew Freed Thanks for the response! Regarding the FHA loan that's good to hear. Are some real estate agents just more "equipped" with finding a buyer that will take an FHA loan? Yeah, we've been primarily looking at duplexes and some triplexes. Unfortunately, as of right now Worcester is greater than the commute time that we're looking for. Do you have any knowledge/experience in the Attleboro, Ashland, East Boston, or Malden area?

Malden and Eastie are probably out of the question. Decent three family home in those areas will be bordering a million dollars. If you are looking at attleboro, then I would look a little further into Providence county Rhode Island. Cities like pawtucket, Providence, Lincoln, and even Woonsocket. While there is strong competition, there are still plenty of opportunities left. One thing to note, is that with FHA you can afford to offer more than list as it will only increase your down payment proportionally. So an extra $40,000 on an offer is only an extra $1,200 in terms of down payment.

The key to making an FHA offer work is to be able to work with the seller. I offered on one house that had chipping paint on the garage, but offered to repair the chipping paint out of pocket in case the FHA appraiser wanted it fixed. While that may have scared off a lot of people, it was enough to get my offer accepted. In the end, they did not make any comments regarding the chipping paint. I was also able to get the house at asking price.

Lastly, don't let the low existing rents scare you. Find out what the going market rents are for the area and base your numbers off of those. Be ready to either raise rents, or tell the tenants to leave and place your own tenants. By doing this I was able to take rents from $900 to $1,900, making the house hack work really well. Feel free to reach out if you have any more specific questions. 

Looking for advice on how to convert a property from 67% rental to 100% rental mid-year. I'd been living in the home for three years.

I've read that I should stop using the asset on X date, then add a whole new asset the next day at 100% business use. I'd then take all the depreciation I've taken up until that point, subtract it from the original cost, then use that as the new cost basis for 100% use. Then that "new" asset would be depreciated for a further 27.5 years. Does this make sense? Or is there another way I should be approaching this?

@Anthony Thompson Honest question here - Have you ever had an issue with filling a vacancy in the PVD area? All the times I've listed something for rent there have been so many inquiries that I've been able to fill it as fast as I could turn it over. Of course, I've only been investing the last few years so I've only see "good times".

Hey Jackson, 

Looks like you're about to make a great decision!

Have you looked into FHA? I recently closed on an FHA loan at 2.375. With 3.5% down, you should have plenty leftover and a solid start for a down payment on your next property. It may be worth comparing that to a RI housing loan. If you need a lender, I can recommend a solid one I've used a few times. At the end of the day, I'd recommend getting a preapproval first. After your offer has been accepted, you can then have multiple lenders give you real numbers. That'll allow you to make a better comparison.

Also, try to get a preapproval for a conventional loan (5% down). This will look more attractive to sellers.

@Brandon Pinarreta when you say youve had no luck, what issues are you running into? I can go on the MLS right now and find plenty of homes in the area that make sense for house hacking. What's your criteria?

Shoot me a message with a property you've looked at, and what your issues were. I'll give you my opinion. I've been house hacking in the are since 2018 and while prices have gone up, there's still plenty of properties that make sense.

@Anthony Thompson hit all the right points. Make sure to check with zoning on how many units the house legally has. Also, try to remove emotion from it, and rely a little less on you "really smart agent." At the end of the day there's a 10k+ commission staring him down. As a buyer, you should always do you own due diligence too.

@Viktor Zguro 1500 for 3br seems reasonable pretty much anywhere in RI right now. I'd recommend at least a fresh coat of paint and maybe some LVP floors if the current ones aren't in great shape. Just remember, nice units attract good tenants.

As you are owner occupying, I'd probably recommend taking the third floor if you don't want to deal with noise issues. Especially with the older houses around here.

As far as those credits, if you can swing it, that's amazing. The 21K back in your pocket almost sounds too good to be true.