All Forum Posts by: Tyler F.

I actually don't need the financing. I could pay all cash for a 15k-25k purchase. I was planning to finance in order to save cash for repairs and/or other deals, but I could pay cash if need be. Then my only monthly expense would be taxes and insurance of about $150 per month, with $750 rental income coming in. +$600/month would add up quickly for any needed repairs and then to recoup my initial investment.

Viewed the property this morning and found out the following new facts:

1. The tenant is Section 8. She pays something like $250-$300/month out of the $750 and the balance is paid by the Section 8 program. She also pays her own utilities. Anyone out there recommend for or against Section 8 in general?

2. There are definite repairs needed in the near future. As someone mentioned with the long term tenant, it is obvious that no repairs or maintenance have been done in a while. The furnace looks extremely old and is covered in asbestos. Seller says it has not been a problem and it continues to function fine, and Section 8 inspections have never required anything more. But I believe it will need to be removed/replaced soon.

3. While the original foundation looks to be in good shape, there was a small addition added to the back of the house at some point without a proper foundation. Seller says Section 8 inspections have not required any repair on this issue either, but my untrained eye says that some concrete block should be added to reinforce the small addition. It appears to be supported only by pressure treated framing against bare earth. It is small and only one sitting room is supported by it.

4. I asked the tenant what other repairs she would like to see, and she mentioned some minor things like a few windows that don't work properly and a cap that she would like put on the chimney because sometimes birds get in there. These are the types of normal repairs I would expect.

So, is this still a no-brainer? What if I could get it for $15k instead of $25k? Can anyone give rough estimates on removing/replacing an old asbestos furnace and reinforcing a small addition with concrete block foundation. I plan to have a local inspector do a full inspection and determine how much I would have to put into the place, and then potentially work backwards from the asking price.

Seller explained that he and a partner are renovating another property and it is costing more money than they expected, which is the reason for this sale.

Thanks for the feedback. I have only seen the property from the outside so far. I have a full viewing set up for tomorrow. From the outside it looks decent. Of course, not as good as some of the surrounding properties and hence their higher prices, but no red flags are visible from the exterior. Seller claims the reason for selling low is only to cash out equity which is quickly needed for another project out of state. It is FSBO, not listed on the MLS and I found it on Craigslist. I was preapproved by a local bank for 100k ballpark, but I did not consider the fact that a 20k loan may actually be too low for the bank's interest, so thanks for bringing that tk my attention. Maybe if some repairs are needed, I could finance the costs in order to make the loan value higher? Not sure what alternative I would have other than paying all cash or finding private financing.

First time investor here, looking to use the buy/hold/rent long-term strategy. Would love to hear feedback from some pros on my potential first deal.

Property is a single family, 2 BR, 2 BA, 1200 sf, built in 1900. I would eventually like to invest in multi-units, but want to start slow, and am considering this as a small, hopefully safe, first step. Asking price is $30k. Seller is an out of state investor who owns free and clear. Current long term tenant (10+ years) would like to stay put. Current rent is $750/month. I am considering an offer of $25k, which would meet both of the two basic tests I have learned about here on BP - the 2% rule and the 50% rule. The property sold for $78k in 2001 and is directly across the street from a similar home currently on the market for $106k. Neighboring properties are also assessed over $100k.

Assuming my potential $25k offer was accepted, I would put $5k down (20%) and finance $20k at 5% interest. My total monthly PITI payment would be about $300, and keeping the current tenant in place at the same rent would bring in $750/month. Seller says no major repairs are needed. Assuming a property inspection could confirm, please tell me why or how this is NOT a no-brainer for my first deal! Thanks!