All Forum Posts by: Mason Hickman

@Matthew Tierney

I would make sure the tenants are aware that you'll be listing the properties for sale and then list them. Depending on the buyer, some buyers may want the tenants and others may want the property delivered vacant. It's best to get it listed and find out who you're dealing with and what the ideal situation is for the buyer. 

I've seen the cash for keys work if it is in the middle of a lease but Section 8 will probably throw another wrench in there for you. Best to get an attorney's opinion on what the implications of Section 8 will be. 

@Kevin Reid

If it is an appreciation-heavy market, go for single families. Long-term they will likely appreciate more than the duplex. Also, it will give you more exit strategies.

On another note, it's surprising that the lot for a duplex would by 2X as expensive. Is there some other distinguishing factor that causes such a difference in pricing?

@Alex Pendleton

You mention an FHA loan but then go on to talk about this as an investment. FHA loans can only be used for owner-occupied properties. It's probably worth reaching out to some of the local lenders like cape cod 5; the local guys have more wiggle room and will keep some of their loans in-house as portfolio loans. CC5 gave me a portfolio loan on a unique situation. Let me know if you need an introduction to any of these guys.

Additionally, if I am thinking of the same $85K condo as you are, I've done a bunch of research into the development and you're going to have a tough time getting financing because it is a motel conversion. 

Happy to discuss more if you want. 

@Matthew Terry

I’m sorry to hear about your grandmother. I’m active on Cape Cod as an agent and have my own Airbnb rental. There is a strong demand here on the cape for short term rentals. You can use airdna for a really rough idea of what your place may generate. If there isn’t a mortgage on the property, you will have no problem covering your expenses. I’m happy to talk more or provide any additional insight on specific areas.

Hi @Tom Colombo

Welcome to the bigger pockets community. Tons of great information on here. 

I'm also right here in Sandwich so I would be happy to get together and talk in person. To answer a few of your questions:

1. The strategy I think that would work best for someone in your position is to purchase a multi-family and do a house hack. 

2. Currently I am focused on the short term rentals but have been considering making the switch to long term for my cape rental. There are a few reasons I am doing short term: 

a. high weekly rates in the summer are pretty good with high demand 

b. the vacancy in the off periods allows me to continue to improve the property and do repairs that will increase the value 

c. Older buildings and lead paint mitigation can be extremely costly for long term rentals

d. Massachusetts Landlord tenant laws are very tenant biased

e. Personal and family use of the property during slow periods or last minute cancellations makes it enjoyable for others I care about and they're supportive of investments

I am thinking about switching to long term because of the following: 

a. there is an extreme shortage of quality rentals here on the cape which is leading to an increase in rents

b. Less headache dealing with tenant complaints and management of turnover than Airbnb/Vrbo

c. Based on the higher rents, the breakeven between monthly rents and weekly rentals is getting compressed

d. Lower monthly expenses like heat, electric, that will be passed on to the tenant

3. I don't know anyone that is doing rent by the room as a business but have met a few people that do it under the table with friends. There are certain zoning and use ordinances you'll want to check into for each of the specific towns. 

4. There used to be a meetup that I have seen evidence of in the forums but I am unaware of an active meetup for Cape Cod investors. I would be interested in getting a group together. 

5. Yes, I am a Realtor and work with investors 

6. MLS is still a viable option for deals if you act fast. I am doing mailers and cold calls/door knocking to generate off-market deals, as well.

@Erik Anderson

What year is the build and class of the property and location? That’s almost $224K per unit; what are other units trading for in the area?

You're going to struggle getting a DSCR that will work unless you put up a lot of cash. All the lenders I work with want between a 1.2-1.25x minimum. Assuming 80% LTV at 3.8% with 30 year amortization, your debt service is ~$33K.

Another thing to consider: if there are two vacant units, why are they listed so far below what you think market value is? I’d check to make sure your rental assumptions are realistic.

@Amy Miller

Swimming; you can go it alone or as a team and if you stop moving, you drown

@Robert Chain

The vacation rentals that seem to do the best are going to be one of three types. If you can get more than one in a single property, all the better!

1. On the beach/next to beach

2. In town locations that are walk-able to restaurants and bars (or wedding venues)

3. Resort style properties with pools and amenities which don't require you to leave the house

Another thing to keep in mind is that there is a huge market opportunity for long term rentals here. Because people can make so much money doing short term vacation rentals, there is a huge lack of long term properties, which continues to drive prices up for LTRs. I'm happy to help dive in deeper if you want to talk more specifics. 

@Kumar Gaurav

@Irene Nash gave some great information. 

Additionally, take a look at the coverage area of the particular Redfin agent that would be covering your home. In our particular area, it is very common for the listing agent to be present for all showings. In some areas, the Redfin agent is working a very large area and unlikely to be available to be present for all showings.

On a different point, if a buyer is searching for a home on Redfin, the Redfin listings show up at the top of the list and they are highlighted in red. 

@Mark Miles

This is the second time I've seen you write that a 3BR house can bring in $250K in the south. Please give us poor, foolish northerners a helpful hint and provide JUST ONE location that you can achieve this...