All Forum Posts by: Tim Winter

@Wendy Black There's nothing worse than kicking yourself for selling a property that later you wanted to keep, but sounds like you've got a plan that isn't as much of a concern? 

If you are looking to sell one of the two properties, my advice would be to get rid of the most problematic one. The condo sounds like its on its way towards being the most problematic, and also having a SFR over a condo gives you more options.

You mention wanting a "crash pad", is it your intention to rent it when you're not there? Snowbird perhaps? The best advice I'd ever gotten when I started thinking long term and what properties to keep, was why not keep properties in places you want to visit, so you can write off the whole trip? Just book the property for the times you'll be there. 

Or if you're going the snowbird route, as mentioned previously if you make that your primary home with the eventual thought that you'll sell it, after two years you can then sell it when or if the need arises tax free. 

If you like the cashflow and still see future potential for them (thus your dilemma?) cash out refi or HELOC might be the way to go. Failing that I'm sure there are private investors in your network that would do a short term loan for cash against one or both of the properties in a portfolio loan.

I don't suppose you or someone in your family has a whole term life insurance policy? Taking a loan against that would be another way to free up capital without liquidating your long term assets. I also know a lender that can lend off of individual investment accounts same as 401k if that makes sense to do for your short term need?

@Mike McFadden I would recommend to the PR that if they setup a 529 plan or "education savings plan", that you'll put money into that plan every month to fund it for the grandchild up to X for the seller financing, plus whatever amount up front that can go directly to the grandchild at Christmas for whatever the guardians want to use it for the child. So on top of the interest rate they earn from you on the sale, the 529 plan can invest to further save for the child's eventual education costs.

Or if they're not sure yet if that child will go to college or private schools, the funds can go into the trust (more expensive to setup) and then the trust can invest that money every month into annuity or whole life insurance plan that the child can "borrow" against after age 18 to use for whatever short term fund needs they come across, or upon exercising the insurance plan towards the guardians, or later in life to the child's family.  

@Kyle Barnhartit depends on your goals. You can get into one with as little as 0% down, or you can get in with as little as 10%. Are you looking to house hack or buy outright non-owner occupy?

Karen Moon with Fairway is my go to lender out here in the Phoenix area. She works with investors and always has great options. I don't think I can post her contact on this forum, but if you google her name and Phoenix, you should find her

As Austin mentions, for the $200k range, you might have better luck finding a SFH+guest house. Most duplexes start around the 100-125k/door in the Greater Phoenix area, and go down in price further out from the center you go. That would be a borderline C/D class property that would need some renovation.

If you are wanting more turn key, we are looking for investors in the outskirts of Phoenix, and also for SFH+GH, small home on large lot, or out building that can be converted to living space. Some deals you have to get a bit more creative to make that diamond in the rough.

I would start with county records and if they'll let you come in person (probably with an apt) then you can try that and ask questions. Failing that you can try calling them and see if they can solve your mystery. 

Every state/county is different, some put them online, others you have to manually request. pre-pandemic some offices it was faster and more reliable to go in and ask for a list.

If you're local, you could go out to the property on the weekend, and see if anyone is at the property and talk to the neighbors. You'll be surprised how much information you can get from the neighbors (one time, a neighbor even had a key and let me view the inside with them.) 

I think why do one or the other, why not do both? Buy a small MF and then rent it out at first to get your feet wet, and then once you get the hang of it, and if your market supports that location making a good STR. You could even try renting out your unit first to get the hang of things, while you go somewhere else or vacation (I have a neighbor that does this all the time while she travels for business.) That way you don't have to risk the extra capital on furnishing and marketing the property, as you'll have most of that done already (who doesn't have a few good photos of their home and doing a video takes just an afternoon after cleaning day! :)

The best STRs though are homes with a GH, and this is also a very easy way to keep some seperation from your renters on your first house hack. They also tend to be nicer places that you'd want to live in, or if you like the tiny home/minimalist living you can live in the smaller unit and rent out the main house or unit for more $.

Lots of options to fit your needs, just have to get a bit more creative on this first one out and you can do both.

Tom, you have to look at total return on your investment. If your business plan focuses solely on one aspect, say cashflow, then yes Ohio makes sense. But for the total return on a long term investment in the area didn't make sense with the numbers we were getting. 

For example, let's take Taledo as it's supposed to be one of the great up-coming areas. Still has negative population growth and also job growth. It's closely tied with Detroit, which is experiencing the same decline year-over-year, but hopes of that turning the corner someday. It's currently a buyer's market, which is great if you're tired of bidding wars in other areas, but looking at it from a 5-10-20yr lens, what are the indicators that it will turn around? Taledo has always been rental over ownership, so the housing market for the foreseeable future is on a downward trend. Housing affordability back in 2018 was that the average household had almost 3x the income needed to purchase, but it still stays a rental friendly area. When you look at rating the neighborhoods, the areas of growth in the downtown area of Toledo unfortunately also are the lowest areas in terms of schools, home values, employment rates, income, etc. 

So its a very risky play as far as total return on investment. You may get into the investment for cheap and experience good cashflow for a few years, but if population/job/rent growth continues to decline over time, you'll find that decreases over time as well. In addition when you exit the value of the asset will most likely have decreased as well, or even if you break even you'll be at a loss when you factor in inflation, depreciation, time value of money, etc. 

Rent growth is what you plan for, appreciation is also what you like to see. While you never bank on appreciation, it's more like a large bonus at the exit (the cherry on top of the sundae) if the value of your acquisition does go up over time. We just don't see it in numbers for the markets in Ohio that we've looked at so far, and none of them hold a candle to Phoenix's markets.

@Kyle Chadwick it really depends on your market, which you haven't really defined what that is. 

Each market is different. Even in Phoenix that is at an insance seller's market since about mid-2020, I found an ON-MARKET deal on MLS searching for diamonds in the rough. We were hoping to rehab it and make it a good lease option or seller financing deal, but we got such a ridiculous offer we took it (and the HOA was fighting us on turning it into a rental.)

So, in summation it really depends. On or off market, sure pursue them all. If you're ranking well on SEO and OnCarrot, that's great, but are you providing enough content that the traffic you're bringing converts? Are you offering rent-to-own options or information, or how to buy an affordable home in these tight high priced market times (always popular topics). 

Cater to your target market and those leads should start manifesting. And if not.. go out and find them. 

Good hunting!

It all depends on the paperwork and the probate judge in ruling if there is no will. Seems odd that he was terminally ill and didn't leave better instructions, but it is what it is.

Once the sister or someone else gets letter of testamentary, that's all you need to start moving forward. Then the PR would just have to settle up the estate afterwards, but that's all you need to wait for is someone to get power to sell the property on behalf of the decedent.

Hope that helps.