All Forum Posts by: Travis Frenchak

Maybe i am naive but its hard for me to believe a tenant would do all that damage.  

I don't use property managers so I really can't say anything on that. But, when you have to call and pay someone to fix something it gets expensive. To fix a faucet handle and a stinky drain will probably cost you a few dollars to do it yourself. When you have to call a plumber or handyman $60 isn't really out of the question. 

Like some of said, sounds like you made some uneducated decisions along the way. At least you are breaking even. Some can't say the same. 

Instead of putting a specific number on a desired CAP rate it would be better to say your desired rate is 1 point above market average.

Say your market average is 6%, your desired rate would be 7%. Once you find a property you like and run the numbers your can negotiate to your desired CAP rate.

Can I obtain a line of credit on my half of a property? The property breaks down like this:

We still owe about $55k

NOI $15k

Approx value @ 9% CAP $165k

Approx. $110k in equity copmbined or $55k each

That NOI is subtracting the mortgage payments. With mortgage payments added back in it would but us around $23k NOI which would increase the value. Would they add that back in to do the evaluation? I know we would if we were to sell it we would but I'm not sure how the bank would do it. This is probably a simple answer as I know nothing about line of credits or equity loans.

Thanks! 

Sounds like you are on the right track. Depending on your state requirements a 30 day notice without reason should suffice. However, some states require more advanced notice from a landlord as opposed to a tenant. Some states also require a reason but i don't think Wisconsin does. Good luck. 

Im with Aaron, get a couple more bids on the job. Perhaps the first crew doesn't really want to do the job so they price it high, and if they end up getting it they get a big payday. Thats a huge difference in bids. Need a couple more to compare. 

2% is non-existent where I am. 1% is even hard unless you're buying old run down properties. But yea, not much left over at <1% unless you're paying cash or putting a large amount down. 

Maybe this realtor isn't even a good one. Maybe he is a good realtor but not a good investor. If you want to make money investing I would try and find an investor as your mentor. If you want to be a real estate agent then by all means have a realtor as your mentor. 

It is also not difficult to get your real estate license even if you do not intend to be a realtor. The course itself is very informative on the business side of buying and selling real estate from a realtor stand point, not an investor. Still worth it i would say. 

Maybe I'm not reading this right but if you get it for <$115k with an ARV of $270k after paint and carpet it seems like a winner to me.

Definitely need more information to run the numbers. In regards to the 2% rule, if I used that for any property I had interest in nothing would work in my area.