All Forum Posts by: Steve Balinski

I have an interesting scenario. I believe I'm about to get an insurance claim approved due to "storm damage" for a roof/siding, gutters, and shed for the duplex i currently live in (no actual major issues, just justified repairs based on what the roofing/siding company reported). Here is my dilemma.

To my knowledge if a claim is approved and a check is cut, it's my decision if I want to get the repairs done, OR cash the check (please advise if that is not the norm). IF I get the work done, the windows are 20-30yrs old, from what I know that'd be the best time to get the windows replaced as well, BUT thats another 15K out of Pocket.

Do I take the check and replace both kitchens which would allow me to raise rent as well?

In a nutshell:

Option 1, get the roof, siding, gutters and shed replaced + 15K out of pocket to replace all windows

Option 2, take the check and replace both the kitchens which allows me to raise rent.

Also, which option do you think adds more value to the property?

0 Votes

Quote from @Jonathan Warner:

Quote from @Corby Goade:

I've got a few tips- like any other business, this is a relationship based thing. Get to real estate meetups and network with people out there doing deals. Here are a few high level thoughts for you as a beginner:

-Don't lend in second position

-Don't do deals with new investors

-Don't experiment with new strategies, even with experiences investors- ie, don't jump in to a first development project with someone just because they've flipped 20 houses.

-Start at a title company- they will help you structure liens and deeds so that your interest is protected properly. They can help make sure your contracts reflect your equitable interest in the deal.

-Vet contractors and builders that your clients want to work with. The trades can make or break a good deal.

There are a billion more, but that's a start.

Good luck!

This is great, thank you. So basically, get an attorney to put my contracts together as the first step, reviewing them with a title agency as the second step, putting the other team members together as the third step, and starting the search for borrowers as the fourth? Or do you mean for me to approach the borrowers first?

Not speaking from experience, but I'd think relationship building takes some time, so finding someone to lend to should be step 1 IMO, then you can start meeting with attorneys and title companies to get the paperwork done.

0 Votes

Quote from @James Hamling:

@Steve Balinski as your presenting things with no context of details such as asset class, tenant class, cap-x, appreciation etc., I have answers ready that match:

1009 7th Avenue S, Saint Cloud, MN 56301

5bd, 2ba, 1680 sqft, Listing/Purchase Price $159,900 - Rent Range $1,830 mnth - Prop tax $1,852yr.

1016 12th Avenue SE, Saint Cloud, MN
4bd, 2ba, 1,466sqft, Listing/purchase Price $226k - Rent Range $1,800mnth - Prop Tax $2,012yr

19 Mckinley Place N, Saint Cloud, MN

4bd, 3ba, 1,686 sqft - Listing/Purchase Price $169,900 - Rent Range $1,870 mnth - Prop Tax $3,100yr

1007 6th Street N, Saint Cloud, MN
4bd, 2ba, 1954sqft - Listing/Purchase Price $175k - Rent Range $1,910mnth - Prop Tax $1,874yr

Need I go on ?......

If a person is going to use tunnel-vision metrics of just looking at price sub $250k, rent's and prop tax and take 0 context otherwise.....

Dude, how many PER-DAY do you wanna buy? Serious. 1 a day, no problem. 2 a-day, I got you!

I can fire-hose these things......

Daaaaang, those numbers don't exist near me, not even close. Curious how you found those, do you know that area or happen to stumble upon it? Cheapest 3/2 near me even in a low class neighborhood is 250K in good shape, or 200K with work to do (nearly a wash after upgrades are done). $1800/month rent around me in C class neighborhoods (and most of WI) is a 250K home. Can stretch to $2000-2200 if its a fresh remodel, but the #'s still don't work.

Looking at B or C class properties, no section 8. No Cap rate being SF. Doesn't have to be an appreciating neighborhood as cashflow is my goal right now. Purpose is to get out of my W2 job

0 Votes

Milwaukee, Wisconsin

Quote from @Kasi V.:

What about vacancy rates and leasing fees ? ...they can significantly impact your numbers. It's a good idea to use a standard spreadsheet or one of the online calculators. You can find one on BiggerPockets, calculator.net, rollytally.com or baselane ROI calculator.

All accounted for in my calculations

1 Vote

Milwaukee, Wisconsin

Quote from @Theresa Harris:

Have you tried looking at longer term mortgages (eg 30 year)?

yea its calculated at a 30yr

0 Votes

Milwaukee, Wisconsin

Quote from @John Clark:

Quote from @Steve Balinski:

Hello everyone, I need some motivation. I've been an investor for about 8 years. Done a couple flips and currently own a 4-unit and a 2-unit.

I haven't looked at properties in a long time due to interest rates killing any potential deal in my area (SE WI). Instead of looking for a multi-unit, I started calculating Single Family properties to see what it'd take to make my #'s work.

230,000 starting price (3bd 1.5bth, very low price for this area).

$1900 rent

$4k Taxes

$1500 insurance

$3k all maintenance

20% down

4% interest rate (just to see if even this would hit my #'s.

RESULT = $220 cash flow :-( :-(

How are you all finding single family properties that work? My target is $500 cashflow, I'm not even close.

I'd even consider 2-4unit, but I know my numbers are even further away.
:-(

What’s your appreciation potential? Appreciation comes at a cost. That cost is cash flow.

as others have said, you missed vacancy. The property doesn’t cash flow.

I didn't mention every cost, but I did include them in my calculations.

0 Votes

Milwaukee, Wisconsin

Quote from @Marcus Auerbach:

Quote from @James Hamling:

5bd, 2ba, 1680 sqft, Listing/Purchase Price $159,900 - Rent Range $1,830 mnth - Prop tax $1,852yr.

1016 12th Avenue SE, Saint Cloud, MN
4bd, 2ba, 1,466sqft, Listing/purchase Price $226k - Rent Range $1,800mnth - Prop Tax $2,012yr

19 Mckinley Place N, Saint Cloud, MN

4bd, 3ba, 1,686 sqft - Listing/Purchase Price $169,900 - Rent Range $1,870 mnth - Prop Tax $3,100yr

1007 6th Street N, Saint Cloud, MN
4bd, 2ba, 1954sqft - Listing/Purchase Price $175k - Rent Range $1,910mnth - Prop Tax $1,874yr

Need I go on ?......

If a person is going to use tunnel-vision metrics of just looking at price sub $250k, rent's and prop tax and take 0 context otherwise.....

Dude, how many PER-DAY do you wanna buy? Serious. 1 a day, no problem. 2 a-day, I got you!

I can fire-hose these things......

James, are these student rentals?

0 Votes

Milwaukee, Wisconsin

Quote from @Paul Novak:

Your numbers look eerily similar to mine. I have made this work by putting more money into my deals. I have the exact same cashflow goals as you. I have rentals in Sheboygan, WI about an hour north of Milwaukee. We purchased a property just this week it was $255K but the interest rate was 8.125% which was crazy. I ended up putting down 30% and paying $907 in fees to get the rate down to 6.875%. This property is a single family home 4 bedroom 2 bath property. We are going to rent it out for $1,950. Our property taxes are $2,400 and our insurance is $965. We will be at that $500 mark for cash flow. I have just been putting more down to hit my goal.

Even with your numbers I added $2,200 per year for maintenance all around I get basically 0 per month cash flow with a 10% management fee and 5% vacancy rate included

0 Votes

Milwaukee, Wisconsin

Quote from @Michael K Gallagher:

If you are looking for a commercial or professional solution then I'm sure someone here will weight in, but I've had an oldschool like gen 1 ring camera system and security at my rental since 2018 and the back camera with the spot lights has just started to break down. Well its really the LED lights have just faded, but for the price I was surprised by the robustness. The ring app is also nice if you want to share camera access with tenants as a perk.

I'll likely get a new camera and just slap it up there here shortly as I doubt I'll be able to order and replace just the lights, but for the couple hundred bucks I spent on it, seems to have gotten my use.

With Ring cameras, are those hard-wired and recording 24/7? How do you connect them if they are hard wired?

0 Votes

Different type of question here. I don't make enough income with my W2 job to contribute to my company's 401k Match. I was wondering if I start taking money out of each paycheck to contribute if I can "refund myself" with my property income?

EX: Each paycheck I contribute $200 to 401k Match, and then refund my personal savings with my rental income.

Thoughts?

0 Votes

All Forum Posts by: Steve Balinski

Steve Balinski has started 28 posts and replied 76 times.

Post: 30K Insurance claim, take the money or get the repairs??

Post: Private lending. Where do I start?

Post: I'm losing motivation, can't find anything that works.

Post: I'm losing motivation, can't find anything that works.

Post: I'm losing motivation, can't find anything that works.

Post: I'm losing motivation, can't find anything that works.

Post: I'm losing motivation, can't find anything that works.

Post: I'm losing motivation, can't find anything that works.

Post: Which security cameras to buy?

Post: Can I use my property income to fund my W2 401K match?