All Forum Posts by: Randall Prosise

I found myself near ground zero here in Beijing when this whole thing broke out, so I made the most of my self quarantine. From the day before Chinese New Year, when C19 was gathering steam here, until now, I have managed to facilitate getting my newly purchased home in Arizona furnished and up and running as a managed STR, bought and will close soon on another LTR House in Arizona, and bought and closed on a cash purchase of another turn-key STR in Tennessee.
The only reason I am upset is because due to the US Embassy being on lockdown, I couldn't notarize for the TN loan, so I had to drain my cash fund that I would have used to sock into the stock market about now. I am contemplating using some HELOC cash to fund some stock that would be a short term play. I believe this virus will continue to make a dent in this economy, but once the carnage is over, it will return fast and yielding profit for those who weren't afraid to take advantage of it and for the companies that withstood the downturn. The irony of the whole thing is that it is now safer here in China than most other countries. I think the stock market is a good play right about now, and if you can find a good RE deal due to some panicky people, then you should take full advantage of that as well. It won't last long, and it will be easier for you than it was for me, trust me :)

This is an unfortunate situation, but I think it will end swiftly such as SARS did 17 years ago once the weather starts warming up.  Influenza kills far more people every year.  Thats just my take on it, and I guess I will check this post next year to see if I knew what I was talking about or not.   

In the meantime, I will continue to use this hibernation period to work on my 2019 taxes and play with my newborn son :)

Good luck, and wash your hands often!

I appreciate  your input @Pamela Sandberg and @Wes Blackwell.  I am looking into both!  

Thank you

Randall

Hello Everyone

I have recently purchased 2 SF homes in Scottsdale, AZ, and they each have a pool.  I have never owned a SF home with a pool.  I am wondering about liability as far as the pool is concerned, as I am in the process of renting each of these houses to families.  

One is a family of 3, with a 9 y.o..  They informed my agent that their child knows how to swim very well, and they were not concerned at all about it.  

The other family has a 2 y.o. and an infant.  I am waiting to hear back from my agent's inquiry into  their feeling about having very small children in a house with a pool.  

I do not want to install a fence around either pool, but am fine if the tenant wants to buy and use a portable fence.  I also removed a diving board from one of the pools, as the insurance company I wanted to use would not even write a policy with a diving board installed.

In the meantime, I would like to know your thoughts on this, as far as how you may have handled a situation like this, or maybe an insurance expert that can give me advice on what coverage I need to have to protect myself?  Can I add language into the contract to relieve myself of any liability in the worst case of a (gulp) fatal accident?

Thank you!

Randall

I would think the question you need to ask yourself is how you would use the proceeds. Your equity is decent, but not like you have doubled your money (yet). Would you 1031 exchange for a bigger investment, and re-set the equity building clock? Also, where would you re-invest? I have built a decent amount of equity in several downtown Seattle condos I own (50-125% equity in each one), and will be selling them, using a 1031 exchange, to buy in a lower priced market I have identified to get more bang for my buck. I can basically trade my three 1 bedroom units and my one 2 bedroom unit for a 24-unit apartment building in another upcoming market. I would rather turn that equity I have built into cash flow as I get closer to retirement from my salaried job. I also am nervous about the Seattle market and what the government is doing there, not to mention the pending crash everyone seem to be thinking will happen within the next 2-3 years. Bellingham is definitely a desirable location with seemingly less of the possible crash factor Seattle has, so you may be in a good place to continue to build up your equity for a while. You know your property and how desirable it is for potential renters, and also if you could lower the rent if you had to with a rental market downturn. Trading for another like property may not be such a great deal. These are big factors in my opinion. But coming full circle, how would that money be re-invested, and is that a better deal for you. I think you have a good problem to solve at this point, and I hope my input helps. Randy

Thanks everyone for your input.  It all makes more sense.  Randy

I am purchasing MF for the first time, after only buying SF condos.  I am shopping insurance for the two 4-plex units that are basically together as one 8 unit complex.  The building is in Arizona, and consists of concrete slab/cinder block construction with a comp shingle roof.  It is all one level (no stairs), does not have a pool, and no other possible hazardous fixtures to speak of.  There is one laundry room with a few machines,  The landscape is pretty basic with gravel and 4 really tall palm trees on the frontage road.  The parking is not covered and next to the complex.  The purchase price was $490k for each 4-plex.

I am wondering what the minimum insurance policy should be?  

Right now, for one 4-plex, I have been quoted: 

Dwelling Coverage: $345,000 (no personal property coverage)

Liability: $300,000

Deductible: $1000

Annual premium: $1038

Is this enough coverage?  If not, what should it be?  Is anything missing here?

Thank you for all your insight, and I welcome any quotes from insurance agents.

Randy

Thanks everyone for your valuable insight!  Well noted, and I will further my due diligence on this one (and others I encounter).  

I mean, does that just mean that security is in place and all good, or I need to set up cameras?

I see a good financial decision getting 8%+ cap, but it does have bars on the windows and a steel cage for a screen door.  OK  or what??

Yuo, we are the crazy millionaires who invest in real estate 😜