All Forum Posts by: Wilson Churchill

I always charge at least $50 per month more for pets. I have seen some charge $25 per month additional rent per pet. I would just assume that if you have carpet that it will be ruined and charge accordingly.

 I'm not a millionaire, but hope to accumulate that number of units eventually.

Tenant quality in low income areas is lower, obviously. But there are tenants that have decent jobs. Section 8 is best for low income areas, but I won't hesitate to rent to tenants with enough income. I look for at least three times the rent in monthly income. The only other thing I look at is evictions. And I talk to the tenants to see if I like them or not, or if they say anything that raises red flags.

Thefts can be an issue, depending on what area the house is in. I don't buy houses that are in a bad area, defined as missing copper or furnace, etc. Knocking on doors and talking to people is the best way to get to know a neighborhood. I also talk to my existing tenants about areas to get their opinion. Repairs are inescapable. A new roof can eat a few months rent or more, depending on who does the work. But a roof shouldn't be changed often.

 $100 to $200 per month isn't insignificant, depending on how many units are owned. Some people get more than that. If one house can generate $5000 per year in cash flow, then only 100 houses are needed to earn half of 1M per year.. Cash flow will lead to a high net worth, provided it is reinvested into purchasing additional units and not spent otherwise.

 The listing agent believes it would sell for $30.000 on land contract. To be fair, this is an unusual deal. I would only sell it if I could immediately buy two additional homes with the proceeds.

RE because discounted purchase and leverage.

 Here is the last one I bought:

http://www.zillow.com/homedetails/163-Legrande-Ave...

I believe that it could sell for 2.4 times the gross rents. It is currently rented for 694 per month, as determined by the housing commission. It was a short sale. The previous owner lived in the home. It needed only minor work, including siding repair, painting, concrete porch repair, hard wired smoke detectors, drywall near the chimney that was leaking, roofing tar, and one floor needed to be lightly sanded and stained. I also added a brick perimeter around the flower bed in front. My total investment is around $16,000.

 That was last year, as I said. The cheapest one I see listed now is $34,900. And it's the only one that cheap. Again, it was the cheapest one in the city. Why should I pay full price for a house if I don't have to? A buddy of mine bought his first house for $20,000 in Madison Heights this year, but it was a private sale from a landlord, and it needs work. He is a licensed contractor and master plumber, so he will do everything.

$20,000 is actually cheap for Pontiac as well. I don't like to pay full price for anything I buy.

 A few years ago there were several here in Madison Heights. I purchased one last year, but it was the cheapest house in the city and I practically had to bribe the listing agent to get it. But my total investment in that one is closer to $30,000. My $20,000 (and less) deals have been in Pontiac. Most investors I talk to shy away from Pontiac for obvious reasons. I used to live there, so I am familiar with the various neighborhoods and hoods. There seem to be some cheap homes in Roseville, Warren, and other suburbs of Detroit.

 I am not familiar with "NBHD". My strategy is to purchase the cheapest homes on the market. I might look at 10+ homes and then cherry pick the ones that need work and are selling at a discount, but are also in decent areas and don't require work that is too expensive. Short sales seem to be the best deals. I have also had luck making low-ball offers on homes.

 Fair enough. I can understand not wanting to manage property out of state. I really have no intention of trying this, outside of larger apartment buildings. But there are plenty of investments in my area to keep me busy.

$7,000 for a turnover? I would like to get the details on that. When I do repairs, I try to do some of the work myself and hire others for $10 per hour to help me. The more I can learn about construction, the less I have to rely on expensive contractors. Since I know how to install a tile floor, for example, I can show people how to do it and pay them much less than if I were paying someone that specializes in tile floors.

Recently, I had a tenant that moved out after getting 6 dogs and 3 cats without my permission. Needless to say, the flooring was ruined. I washed the walls and floors with bleach, after removing the carpet. I installed tile and paid people to help. The entire cost was less than $1000. I collected $4,900 from that tenant over a six month period, so I am not to disappointed. The security deposit covered most of the cost, and I had the unit rented the next month, producing no vacancy.