All Forum Posts by: Steven Barr
Steven Barr has started 87 posts and replied 162 times.
Post: Birmingham, Alabama Over saturated Section 8?
- Atlanta, GA
- Posts 163
- Votes 57
Birmingham is a very tough market. You can’t go by “area” or even “pockets”. It’s street by street. One street makes a world of difference between minor and major crime.
For section 8 specifically, lots of West coast investors came in over the last few years and bought a ton of homes which has given Sec 8 tenants a ton of supply to choose from. Very common to see them stay in a house for 1 year there, trash it, and move to next one
Not to say you can’t make it work, but much harder than just going on Zillow or to a wholesaler, buying a 70k property, and cashflowing
Post: Is anybody cashflowing right now???
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Fernando Figueroa:
Quote from @Steven Barr:
With home prices still very high and interest rates now high too, is anyone actually cashflowing on newly acquired property? Even the 1% rule doesn’t seem to work anymore
Example: assuming 20% down
Purchase price: 250k
Rent: 2500/mo
Expenses: 1375/mo (45% expenses)
Debt service: 1350/mo (200k at 7% fixed 30 am)
Cashflow: -$225
Do the numbers the other way around, and adjust the purchase price accordingly. Then you will cashflow.
@Fernando Figueroa what do you mean by “do the numbers the other way around”?
Post: Is anybody cashflowing right now???
- Atlanta, GA
- Posts 163
- Votes 57
With home prices still very high and interest rates now high too, is anyone actually cashflowing on newly acquired property? Even the 1% rule doesn’t seem to work anymore
Example: assuming 20% down
Purchase price: 250k
Rent: 2500/mo
Expenses: 1375/mo (45% expenses)
Debt service: 1350/mo (200k at 7% fixed 30 am)
Cashflow: -$225
Post: Are you allowed to use the security deposit to "turn" property?
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Nathan Gesner:
Quote from @Steven Barr:
@Dena Puliatti here's an actual quote: "...may be applied to the payment of accrued rent and the amount of damages that the landlord has suffered by reason of the tenant's noncompliance with Section 35-9A-301."
The first link explains how to handle the deposit. The second link lists requirements of the tenant. If section 301 requires them to keep the rental clean, then section 201 says they can be charged for failing to do so.
But I'm not an attorney.
Alabama deposit law: https://law.justia.com/codes/alabama/2019/title-35/chapter-9a/article-2/section-35-9a-201/#:~:text=(a)%20A%20landlord%20may%20not,obligations%20under%20a%20rental%20agreement.
This shows what you can charge for and it does include cleaning: https://law.justia.com/codes/a...
@Nathan Gesner super helpful thank you!!
Post: Are most Craigslist deals a scam?
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Dan White:
Quote from @Steven Barr:
Quote from @Dan White:
Quote from @Steven Barr:
Has anyone ever bought a property off Craigslist to flip?
We are looking right now, and there are some great deals. However, no one is answering their phone, and we have noticed that we are calling the same 5 numbers for about 20 different properties
Most of the phone numbers do not belong to anyone. But we did find one of the numbers was attached to an actual person. We then looked at property tax records, and the owners name did not match up with the owner of the phone number listed. Also the details of the bed count and sq ft were incorrect
Seems to be all scams, but I have never done this before, and hoping someone on here knows how to navigate Craigslist more successfully than I do!
Thanks
Everyone I have looked into has been an outrageous FSBO or a wholesaler. No luck so far and I stopped looking at them.
@Dan White do you not like buying flips from wholesalers?
We never have bought from one. It is a sensitive subject around here as BP is filled with all folks REI. We just find deals direct and skip them. A lot of guys in my area use them but we find the process cleaner and more profitable to deal direct with the homeowner.
@Dan White certainly more profitable to go direct to homeowner. Our problem is lead flow.
How are you finding your homeowners to buy from directly?
Post: Are you allowed to use the security deposit to "turn" property?
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Dena Puliatti:
@Steven Barr You can only use the security deposit for damages and debris removal. The cleaning of the unit should not be charged out of the security deposit. We charge 35% of the rent up front as a cleaning fee and use the remaining 65% of the rent as a security deposit.
@Dena Puliatti that’s an interesting concept. So to make sure I understand…
Rent is $1,000/mo
You charge the tenant $350 to clean to unit before they are placed there
You take $650 and put it in a trust account as a security deposit
You give them $650 back at the end of the lease provided no damages
Is that correct?
Post: Are you allowed to use the security deposit to "turn" property?
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Nathan Gesner:
You can generally use the deposit for cleaning, repairs, and unpaid balances on rent, utilities, etc.
You need to educate yourself on what is "ordinary" wear-and-tear and what is considered abuse and neglect. Generally speaking, there will always be some wear-and-tear on a rental, just like there is on your personal home. Putting a few small nail holes in a wall is ordinary; putting four lag bolts into a wall or 100 staples into the window trim is not ordinary.
I have no idea where your investment is, so I can't give you State-specific assistance.
@Nathan Gesner I am in Alabama
Post: Are you allowed to use the security deposit to "turn" property?
- Atlanta, GA
- Posts 163
- Votes 57
Hi BP!
Once a tenant leaves and you have to get your property "fix-up" ready for a new tenant, what are you allowed to use the previous tenant's security deposit for?
Are you legally allowed to use it to fix "wear & tear" items (spot painting, fixing damaged flooring, cleaning, etc..)? Or is it only to be used on major items (holes in the wall, etc..)?
Thanks!
Post: Are most Craigslist deals a scam?
- Atlanta, GA
- Posts 163
- Votes 57
Quote from @Dan White:
Quote from @Steven Barr:
Has anyone ever bought a property off Craigslist to flip?
We are looking right now, and there are some great deals. However, no one is answering their phone, and we have noticed that we are calling the same 5 numbers for about 20 different properties
Most of the phone numbers do not belong to anyone. But we did find one of the numbers was attached to an actual person. We then looked at property tax records, and the owners name did not match up with the owner of the phone number listed. Also the details of the bed count and sq ft were incorrect
Seems to be all scams, but I have never done this before, and hoping someone on here knows how to navigate Craigslist more successfully than I do!
Thanks
Everyone I have looked into has been an outrageous FSBO or a wholesaler. No luck so far and I stopped looking at them.
@Dan White do you not like buying flips from wholesalers?
Post: Are most Craigslist deals a scam?
- Atlanta, GA
- Posts 163
- Votes 57
Has anyone ever bought a property off Craigslist to flip?
We are looking right now, and there are some great deals. However, no one is answering their phone, and we have noticed that we are calling the same 5 numbers for about 20 different properties
Most of the phone numbers do not belong to anyone. But we did find one of the numbers was attached to an actual person. We then looked at property tax records, and the owners name did not match up with the owner of the phone number listed. Also the details of the bed count and sq ft were incorrect
Seems to be all scams, but I have never done this before, and hoping someone on here knows how to navigate Craigslist more successfully than I do!
Thanks