All Forum Posts by: Melroy D'Souza

Thanks everyone for the replies. I searched the forums and found a similar issue, but I wasn't sure if it is appropriate to dig up old threads (4 years old) and bring them alive.  @Russell Brazil, @Mindy Jensen .. let me know if it is appropriate. In that thread, the consensus was that the repairs should not be more than 2K.

Just to give a little more info, this house is on a slab. That's what worries me. I guess I will run the numbers again with a worst case scenario.

I am going to offer on a REO that does not have utilities turned on. I was just lucky in the past that the other 2 REOs I bought did not have busted pipes. This one specifically says "We did a pressure test and the pressure did not hold for both water and gas". The house is actually in decent shape except for the roof and electric panel.

So how much will it cost to remedy broken pipes? How does one go about figuring out where the water pipe is broken? Any suggestions or anyone that had a similar experience recently? Just to get an idea of the cost?

@Gary Dezoysa

I must second the opinions of the others, there are areas in Ohio that are growing. Look for the 3 largest Ohio cities. They still have a decent population to work with. 

BTW, you are never going to have everything - great cash flow, great appreciation, great future outlook all in one place :-) ... It might happen temporarily like in 2008-2010 in some of the high growth areas or more recently in some Texas cities, but then as soon as investors start buying up properties, you're not going to see cash flow any longer.

If you are an out of state investor, why limit yourself to one state? Diversify - buy a few in the mid west, buy some in the south. Within each area, select 2 or 3 states. That will reduce the sting if a "Detroitesque" situation comes along in any one city.

@Adam Martin

I think you've covered pretty much everything. Other incidental ones include advertising fees, stationary, supplies, lawyers fees, educational expenses.

Just remember that the percentages you have are not hard and fast. If you buy a 50K property and another 150K property, the CapEx and Repairs will DEFINITELY not be the same percentage. Some people like to go with a fixed amount like $250 for CapEx. Go with whatever works for you.

First thing you need to find out is how much those kind of properties rent out for. Try the zillows, trulias, rentometer, etc.

Quick dirty math - Expenses = 50% of rent (realistically it could be between 35 and 60). This will include taxes, insurance, capital expenses, vacancy, maintenance. Expect a higher percentage in expenses for lower priced properties. 

Say rent = $1000

Expenses = $500

Net cash flow = $500 - {any mortgage payments} ... mortgage payments  only include principal and interest

Hope that is a start. Good luck.

@Joel Miller

Welcome to BP. If you want to be a buy and hold investor, my advice is to stick to areas that you are familiar with for your first or first couple of properties. I don't know the Clintonville area well enough to give you any suggestions. What I would do is go to the Zillows, trullias, etc. and see what the price of properties are and how much they rent for. Note, these values are not always accurate, but they are a good start. Learn to use a few calculators, there are some on BP or create one of your own. Plug in the numbers and see what makes sense for you. Drive around the neighborhoods where the numbers work for you. If you are comfortable, then hit up some agents, network with wholesalers and just dive in. That is a good route for some one who doesn't have a lot of time. 

Alternatively, you can try other strategies like private lending, you will be the lender. Make sure you have a good collateral and investing with some one who is trustworthy, experienced, etc.

Just place the ads on Craigslist and see who bites. There are cash buyers who look to buy there, easy free way to build your list.

For 2017 my goal is to get 4 buy and holds for my portfolio. I am a recent licensed realtor and my initial goal was to just represent myself. I cannot stand "retail home buyers" who cringe about wall paint colors, etc. But I would love to work with investors that don't need a lot of hand holding, I am with a discount broker and don't sell real estate for a living, hint hint ... my fees are low :-)

@John Horner, I was thinking of a 1.5% listing fee, plus additional 3% co-op to the buyer broker if there is one. I could also go with a flat fee depending on what services are needed. 

@Patrick Yuska,

Welcome to BP. PM me and I have a few suggestions. There is a free landlords meeting this Thursday 19th at Tommy's Pizza in Dublin at 6:00 pm. Also look at COREE.

 Chris,

What has been your experience with BuildRealty, Ownerland and Transaction Realty? What are their fee structures?