All Forum Posts by: Mike D.

I'm considering buying a couple duplexes and am curious if it is customary for the tenants to do their own lawn mowing? The duplexes are 2 bed 1 bath, no garage. Rent is $550-$650 per side. Any suggestions or experiences would be great. Thanks.

Since the Roth IRA allows you to pull your principal back out without penalties I would have to say it makes a lot of sense to at least park your money there unless you're buying buildings all the time. But 401k and Regular IRA there's a 10% penalty levied if you take money out in which case you're probably better off if you can put that cash towards RE that gives you a decent COC return. I started investing in my 401k anywhere from 6-15% of my pretax income into "aggressive" funds when I started working back in 2004. Well last year I dug through the Fidelity website for my annualized return of all the pretax cash I had invested over the last 12 years and the result was a whopping 5%. I'm in no way going to retire comfortably on money growing at 5% annualized return. Since then I have dialed way back on my 401k. In my opinion the 401k is just a way for Wall Street to get their hands on more of our money.

I'd say it depends on if you are able to keep your money moving in real estate. If you're sitting on a pot of money all year until you find another good deal it probably makes sense to use the IRA.

@Matt Geerts that's a great idea. Thanks. 

I know there is a push by landlords to make the tenants pay for their own utilities. However I've found that for people at the lower end of the rent spectrum they really appreciate having one bill each month. It's hard enough for some of them to set aside a chunk of cash for rent, let alone 2 or 3 other bills for heat, water, trash.

I have apartments where tenants pay their own heat (gas furnace) and apartments that I supply the heat (hot water boiler). I've found it is much easier to raise the rent and advertise "all utilities included" on the heat included units vs the units where tenants pay their own heat. They perceive more value in the all utilities included.

@Steven B.you're probably right $100 is too high; thanks for pointing that out.

The building is separately metered. But when tenants hear that they have to pay for electric heat in the winter they run the other way. Electric heat is very expensive around here. So I'm looking for a way to cover their heating bill without getting stuck with a $500 bill because somebody left it a 100 degrees all day.

I'm considering buying a 12 unit that has electric heaters. I'd like to make it so that heat is included with the rent by paying for each tenants' electric bill myself. To keep people from abusing the free heat I'd like to put a clause in the lease that if the electric bill is over $100, the tenant gets billed for the overage and they must pay it in next months rent. 

Is that as simple is putting a clause in the lease? It would be some extra work billing the tenants for the overage but I've found that including all utilities is very popular around here. 

I could beat the 2% rule all day long if I invested in the ghetto haha. For $30k you can get a house that brings in $1500/mo. But good luck collecting and keeping the 1900s house maintained without working on it every weekend.

Im looking to make an offer on a house for my primary residence. We contacted the listing agent and she gave us a tour. I've researched recent sales online and have a good idea of what to offer. Does it make sense to go recruit my own buyers agent or could I end up with a better deal working directly with the Sellers's agent? I've bought investment properties before by working directly with the seller just because it was easier. Thoughts?

Stephen Gilmore you can look up the property on the county recorders website. Search for the mortgage documents.

I am borrowing from a local lender at 15% on my 4 plexes. The trick is finding a local lender who specializes in lending to investment properties. You will have to call around a lot to find the loan officer who can do that. You can get a feel of what banks like lending to investors by parusing the recorded mortgages. Find a chunk of 4 plexes in town and see what bank is financing them.