All Forum Posts by: Jason Krick

Originally posted by @John D.:

It's been 10 years, time to replace that garage door I put in in 2006, it's forecasted to have zero useful life right now!

 My house is 100 years old and has never been reframed.  It's 70 years overdue!

I literally had a counter to every point on this list, until I realized the same thing that @Dawn Anastasi did.  It explains why the math hasn't been shown from the beginning.  The OP is re-stating someone else's thoughts as his own, maybe to get Ben (can't tag him), a well-known and respected member to come to his defense.  Can someone just tag Ben for him? It might make it easier.  The OP has started multiple threads like this.

The catch is that Ben himself said that these numbers aren't to be taken literally and used for every property.  Correct me if I'm wrong, but I believe he said in a podcast that the reason for the post is to get people to take a larger view and to remember to incorporate items that many overlook.  I absolutely love Ben's points of view on many aspects.  I've learned a lot from what he has said and written.  I just think that if another member is going to re-state his view without giving him the credit, Ben should at least be aware that the conversation is being held.  

Originally posted by @Brice Hall:

@Jason Krick

Hvac, flooring, plumbing, fixtures, water heater, appliances, components, structure, kitchen cabinets/countertops, Windows, paint, landscaping 

 I asked you to break down the cost of each one, divide it by its usable life, and show me how it comes to the $90,000 you say it is.  Please itemize with cost per item and life expectancy of each.  Also, please leave these out:

HVAC--have electric baseboard heat and no AC

Water Heater--I already accounted for that

Windows-I already accounted for that

Paint-Falls under Maintenance

Landscaping-Also Maintenance

Plumbing-Maintenance

Finally, can you please expand on the following:  fixtures, components, and structure?  Too vague to assign an amount to.  What do you believe the usable life of "structure" is and how much do you set aside each month for it?

Again, please itemize each remaining Capex item with it cost, expected lifespan, and monthly amount needed.

Originally posted by @Brice Hall:

@Mary lou L.my suggestion would be to stay far away from ~$30k houses that rent for $700 a month. Why?

Taxes/insurance: ~$200/month 

Vacancy: ~$75/month

Maintenance: ~$75/month 

Management: ~$75/month 

Capex RESERVE / replacement: ~$250/month

So I have a question, but first I will go along with your premise and (as you state) "amortize" my Capex items and set aside for my Capex reserve. Now, if I can fully renovate one of these houses for $20,000 for all new Capex items, so we start from scratch. Which item has the shortest lifespan that needs to be replaced? Others may disagree, but I'm going to say the water heater. Many brands claim a 10-15 year lifespan, but I will give it an 8-9 year life. That should be my first Capex expense, in year 8ish.

So, I am putting $250/month in Capex reserves. That's $3,000 a year. That means I will have my $20,000 that I need for another full renovation in less than 7 years, which is before my very first expected Capex item needs to be replaced. Then what do I do with that $250?

I'm not as experienced as some of the brilliant minds on here, and some of the best have chimed in, but can you show me how, for a small $30,000 property, I would need to spend $90,000 in Capex over 30 years?

Roofs last 20-30 years (or more)--replace twice @ $12,000 total

Windows--pretty much the same

Water heater--replace 4 times @ $6,000 total.

That's $30,000, so far, over 30 years. Show me where the other $60k should go to. It has to go somewhere, because you budgeted $250 a month for it, and told us all that you breakdown the useful life of these items.. I'm not saying my 3 items are it for Capex, as I know there are more, but it's a start. So, what will I be spending the other $60,000 on?

@Patrick Smith

The  "government" I'm talking about is a township.  My county is broken up into a variety of boroughs and townships that oversee the local budget, zoning, planning, public works, etc.  The meeting I was referencing was a Board of Supervisors meeting that is held once a month and is open to the public.  I took the time to go, listen to what they discussed, and stood up when they asked if there were any comments from the attendees.

@Luke Tait

I guess the best way to describe it is the governing body for the local government.  There is a board of supervisors that make decisions on the township (or borough, etc) in regards to ordinances, road maintenance, police force, oversee the budget for income from property taxes.  I'm not sure how that compares to Texas.

As the title says, my question is about a Commercial loan to my single-member LLC. I provided a personal financial statement, and a personal guarantee on the loan (standard). I was just wondering if the payments on the commercial mortgage are reported to any of the credit reporting agencies?

Bill Gulley Your last statement is gold. It is rarely talked about on here. As I am just getting my feet wet, I'm learning the importance of connecting with local offices, township supervisors, etc. I went to a township supervisors meeting 3 days after I closed on my first property to introduce myself, told them about my plans, etc. They were thrilled that I took the time. After the meeting, one of them came up to me to talk and already let me know that there are a ton of "accidental landlords" in the area that would love to sell, if someone came along, and he'd help connect me, and walk me through any zoning or permit issues that might arise.

Each property/deal is unique. I just purchased my first investment property at the beginning of March. It was an REO from Goldman Sachs. It was initially listed at $89,900. After the asking dropped considerably, I purchased for $17,500 when the asking was $39,900. As-is appraisal came back at $50,000 with an ARV of $135,000

@Brian Eastman

Thank you.  I know my specific situation is not common.  I was just getting a bit worried, as it seemed like the best solution, given my situation.  Thanks for the info.

I get the overall thoughts and reasoning for this thread.  It's a great topic IMO, and should be explored in more depth.  I think the point that was made about how you must earn $14k to replace $10k in funds illustrates that stance.  Not sure who mentioned it, but it painted a good picture.

Thanks again for your opinion on my current situation.