All Forum Posts by: Rob Myers

Vertical cast iron stacks usually aren't an issue, but if you have a wall opened up by all means replace the horizontal drain and vent piping with PVC.  It's only a matter of time before you have a leak.

I recommend a similar approach for galvanized water supply piping in walls as well.  I wouldn't rip out good pipe in a basement, but it's easy to replace with pex or CPVC when you have a wall open.

When I bought my first foreclosure in 2010, I used conventional bank financing.  Part of the appraisal process was to have the water turned on.  The explanation I received is that the appraiser, acting on behalf of the bank, wants to make sure there isn't a catastrophic plumbing failure that the bank would be financing which could give me as the buyer a potential reason to walk away from the loan.  I had to pay to re-winterize the house which set me back a few hundred but still left me a decent deal. 

Your vacancy, repairs, capex, and PM fees all look too low.  Based on the area you mentioned, I'm guessing the house is probably 100 years old +/- and unless it's recently been completely renovated is going to cost you more than what you are thinking.  

I'm in a similar situation with a tenant that consistently pays 15-20 days late.  I elected to renew the lease, but went month to month.  In hind sight, I shouldn't have renewed the lease this fall as it's an ongoing hassle I should have moved on from.  Since I'm month to month now, I'm waiting until Spring then sending notice that I'm not renewing the lease. 

As others mentioned, estimating software is only a means to quantity the work.  Pricing comes from historical databases with input from the local market and can vary widely based on the project type, size of project, location, etc.  Keep a good network of contractors that you can reach out to with a description of the work you need accomplished that can provide reasonable ballpark quotes before firming it up with a detailed estimate.  Good luck!

I'm not understanding your company's role in the building process.  Are you hiring the general contractor or are you strictly providing funding?  Who holds the contract with the property owner?  I need to understand the contractual relationships before I can give feedback on what risk needs to be insured.

Find out when your building inspector's office hours are and stop down and explain the situation.  Tell them you want to do the right thing and have the work inspected to be legal.  You might receive the generic answer that you need to rip everything open and have it inspected, but many times you will find the inspectors will work to a more reasonable middle ground.  If you can find a reasonable way to get it permitted, you just built instant equity in the deal.

Don't count on Zillow when analyzing properties in Milwaukee.  Zestimate and city tax assessed values are two numbers on there that don't mean a thing.  I will say that Zillow does have a nice function where you can see recently sold comps in the neighborhood by browsing the map.  That's the extent of the Zillow data I use.

Good luck.

Not stupid at all!

I hired a PM for my first rental property mainly because of my very limited free time and lack of ability to respond to tenant issues in a timely manner.  As long as the numbers still make sense calculating in the cost of property management, go for it.

I had a similar version of the scam happen to me where I had a house listed for sale on the market.  Someone setup a fake Craigslist add for rental with the rental rate at about 1/2 of what market rent is.  The house was vacant and I was fortunate enough to have my neighbor contact me and let me know a lot of people were stopping by to look at the house.  I reached out to the local police department to give them a heads up, contacted the scammer by replying to the ad notifying them I was on to them and also had a sign posted in a window.