All Forum Posts by: Ray Harrell

It depends. If your mortgage is 3% and you can find an investment vehicle paying higher, then would make more sense to put it into that vehicle (an IRA?). Is your goal more income property? Might make more sense to save up for a down payment toward another property.

If your mortgage is one of the old 10% or more, then by all means pay down that mortgage principal!!!!

What is a "guest" addendum? You don't have to addend every rental situation. She has her own place with her own lease, so she doesn't need to be on the lease. I'm surprised she submitted to a background check. Personally, I think you are overstepping if she is not staying 30 days consecutively. People are allowed to have guests.

Section 8 is different in Chicago. One or two section 8 units in a block or neighborhood, you probably won't notice anything. But have an entire community of mostly section 8, watch your property values PLUMMET!!! In Chicago, if the tenants damage the property (break windows, remove screens, punch holes in walls, destroy faucets, don't clean), then the CHA will abate the rent until all the conditions are fixed. My experience with section 8 is that it was a never ending battle to keep the property compliant long enough to get any rent. The tenants don't care about your property, because section 8 will just relocate them to another property and they become someone else's headache.

I would only do section 8 again in an A or B class neighborhood with mostly market rentals and homeowners. But A and B areas the market price is far beyond what section 8 will pay (their market value is a city-wide average), so that's how you keep "undesirables" out of those areas.

In addition to laws, you want to make sure your market and unit can bear a rent increase. What are the other rents in the area? What are they offering for the price? Agreed with Thomas. Learn your State AND LOCAL (more important), building codes and tenant/landlord ordinances. Your local ordinances should accommodate any state requirements as well.

Unfortunately, you can't just add a kitchen and call it an apartment. Will the downstairs people have direct access to the upstairs unit? Do the ceiling heights meet code for a residential dwelling unit? Is there a separate water/electric/gas meter? A "large window" may not count as a legal egress. These are all things to think about, and your city/town building code has details. Keep in mind that if you do any modifications, you may be required to meet CURRENT building code, whereas the current setup may be OK under previous building code.

An oscar won't flush down the toilet.

They hold tenants responsible for appliances so they don't have to pay for repairs. Check to see if the lease indicates appliances are included. If so (even if it's a checkbox), the landlord is responsible, regardless of a verbal agreement, or an addendum. If there is conflicting information in the lease, the court will usually favor the person who DIDN'T write the lease, because the lease writer should have been diligent to ensure there is no conflicting information.

Will your debt/income ratio allow you to purchase another property?

For some odd reason owners occupying don't want to be in a high rental concentrated area. Higher income renters don't want to be in a rental area. 

Are they single family units or multis? Roanoake VA's rental market will look quite different from Chicago's rental market.