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Zero VGS posted:You know what's great... buying a condo for 68k, getting a Home Equity Line of Credit for 75% of the value, using that to buy a second condo in the building in cash, then moving into the second condo, calling a second bank and getting a second HELOC on that.
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May 2, 2014 20:13
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FISHMANPET posted:Don't even joke about that. If I won the lottery or just came into some money, I'd buy the apartment building I live in (80 or so units) and turn 3 or 4 units into a rad penthouse. Someday, someone will convert LPM to condos, and then we can fight each other for the top floors. Or that lot by Calhoun, except it's by Calhoun so no one will ever be able to get something built there.
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May 2, 2014 21:44
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I'm sure Magellan will do the conversion themselves. I live in the ghetto, and I could pick up my building for cool $6 million (current tax assessed market value), so I don't even know. Like I have anything close to $6 million sitting around.
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May 2, 2014 21:58
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No Wave posted:Wow. Where is this? Some dump twenty minutes from Boston, it isn't anything special but everyone around here is "bad credit / no credit", lots of section 8 and immigrants. Hence the rents are disproportionately high, supply and demand I guess. Some fuckface named Steve Winn is trying to build a casino here which is supposed to turn our economy around, but it'll probably just create more traffic and crime than we already have to make the rich richer.
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May 3, 2014 02:10
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It's that time of year again, end of lease time! My current tenants have been in since last summer and I offered them a $50 discount (from $1500 to $1450) if I didn't paint it and gave them immediate occupancy. They were stiff negotiators but it was what I was receiving before and made it so I didn't have any gap in rent since the previous tenants left before their month was up. Comes up to renewal time so I make my friendly phone call 45 days ahead of time (generally do it sooner, but life overtook events) to see what their plans were. I let them know that I would be willing to keep the rent the same if they signed another year and otherwise we'd do month-to-month for a bit. A few days later she comes back with a request of lowering the rent another $100/month to sign for another year, or else they'll do month-to-month until whenever. This is following a comment she made about how difficult it is to find a place to rent in the area and how quickly they go. Her rationale is that I will have to spend money (mortgage/etc) to find new tenants so she's saving me money by doing so. I love the logic that saving my vacancy costs should be her profit. I reply back with three options: 1. Renew lease for $1,450/month (same rent) 2. Sign two year lease for $1,400/month 3. Go month-to-month for $1,450/month for a maximum of 3 months My rationale for the 3rd is that I don't want to rent out in the middle of the winter or 30 days before they feel like flying the f out of there. I'm kind of regretting allowing the three month as it puts me in Sept/Oct when school is back in session and a lot of prospective tenants have children. She responds back with a counter-offer of $1,400/month for a year, or else they'll go month-to-month until they find something. She starts commenting on some leak that is moldy that her kid can't sleep in (it's mostly condensation from the tub above the room, it's leaked before but nothing that's a big deal) and that the place needs paint and has nails all in the walls. She would be doing me a favor by taking a $600 discount so that I could avoid vacancy. At this point, I'm prepared to pull my offer to do month-to-month and just ask them to leave at the end of the lease. I would be able to paint and re-carpet the whole home and likely charge $100-200 more a month in rent for the property. I don't feel that I could pull that option in good faith at the moment because I had agreed to be flexible at the end of the lease previously and they've simply ASKED for a discount, but haven't been nasty about it. However, if she continues to push the case I am going to do so. I'm itching to do the work in the house, actually. I thought you would all enjoy this little tale and update as there hasn't been much posting here recently. I also wanted to ask if anyone had any suggestions and insights about the cheapest way to do carpet/flooring. I have really old carpet and nasty linoleum in the home. It's about 1,550 square feet (of which maybe 10x15 is lino, 95% of remainder carpet, with the rest tile I won't touch) and I just want something fresh down and isn't a nasty color. What's the industry standard trick for this? I don't have time to install it myself. Thanks!
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May 23, 2014 19:21
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quote:At this point, I'm prepared to pull my offer to do month-to-month and just ask them to leave at the end of the lease. I would be able to paint and re-carpet the whole home and likely charge $100-200 more a month in rent for the property. I don't feel that I could pull that option in good faith at the moment because I had agreed to be flexible at the end of the lease previously and they've simply ASKED for a discount, but haven't been nasty about it. However, if she continues to push the case I am going to do so. I'm itching to do the work in the house, actually. You have every right to pull your offer. In fact, you don't even have to. As soon as she makes a counter offer, that implies that she has declined what you offered. Unless you REALLY need the money and can't risk vacancy, I would just tell them that you're sorry you couldn't come to an agreement, and let them know that you will begin marketing the apartment immediately. They're taking advantage of you. When I was showing my house a couple of months ago, this couple wanted to move in at reduced rent in exchange for "fixing up the place". I responded that the house was in good repair, and if they had any specific concerns, I was happy to address them. They moved on, thank god. quote:I thought you would all enjoy this little tale and update as there hasn't been much posting here recently. I also wanted to ask if anyone had any suggestions and insights about the cheapest way to do carpet/flooring. I have really old carpet and nasty linoleum in the home. It's about 1,550 square feet (of which maybe 10x15 is lino, 95% of remainder carpet, with the rest tile I won't touch) and I just want something fresh down and isn't a nasty color. What's the industry standard trick for this? I don't have time to install it myself. Good question, I'm interested in this as well. I went the Home Depot route and felt it was a poor value (though they did a decent job).
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May 24, 2014 00:00
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Blackjack2000 posted:You have every right to pull your offer. In fact, you don't even have to. As soon as she makes a counter offer, that implies that she has declined what you offered. Unless you REALLY need the money and can't risk vacancy, I would just tell them that you're sorry you couldn't come to an agreement, and let them know that you will begin marketing the apartment immediately. Thanks for the feedback. After she said she would do the month to month I said that there would be a three month maximum. She really didn't affirm or deny anything so I'm not sure where that is from a legal perspective especially since it's all verbal (well over text message). I think I may have painted myself into a three month corner unless she counters again. C'est la vie. I went to home depot today and it didn't seem to bad of a deal but will shop around. About $1700 to replace 1165 square feet of carpet including ten stairs on their cheapest neutral brand. The 21x10 kitchen can be done for $350 of the allure brand of floating plank that looks stupid easy to install. Considering extending that to the living room on that floor and then carpet the rest.
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May 24, 2014 00:50
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TraderStav posted:Thanks for the feedback. After she said she would do the month to month I said that there would be a three month maximum. She really didn't affirm or deny anything so I'm not sure where that is from a legal perspective especially since it's all verbal (well over text message). I think I may have painted myself into a three month corner unless she counters again. C'est la vie. I don't think you're in a bad position. You can fill a vacancy in the fall, it's a little bit more of a pain, but it's certainly doable. Not every prospective renter has school age kids, and even some that do will need to find another place for one reason or another.
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May 24, 2014 03:49
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Blackjack2000 posted:I don't think you're in a bad position. You can fill a vacancy in the fall, it's a little bit more of a pain, but it's certainly doable. Not every prospective renter has school age kids, and even some that do will need to find another place for one reason or another. Word is it is very hard to find a place right now, my neighbor is a realtor and tells me that they send over an intent to occupy before seeing the place. I live a solid sixty miles from my rental so it may not hold up to how crazy my primary homes market is going but gauging the listings nearby it's slim pickings for those moving. I have ten bucks the tenants come back in a month or two and ask to sign that one year. At that point, should I raise it on them?
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May 24, 2014 04:00
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TraderStav posted:Word is it is very hard to find a place right now, my neighbor is a realtor and tells me that they send over an intent to occupy before seeing the place. I live a solid sixty miles from my rental so it may not hold up to how crazy my primary homes market is going but gauging the listings nearby it's slim pickings for those moving. If they're model tenants between now and then I'd offer 1 year at $1450. But it wouldn't surprise me if better/tougher landlords giving better advice than me would suggest $1500 or even more.
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May 24, 2014 05:22
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People, do not use Home Depot as a contractor. Find yourself a good independent flooring guy.
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May 24, 2014 08:04
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DNova posted:People, do not use Home Depot as a contractor. Find yourself a good independent flooring guy. Thanks, I will check the local guys. When the lease ends on June 30, do I need to do anything from a paperwork standpoint to roll into a month-to-month? Anything that I SHOULD do to protect myself? edit: May have answered my own question, create an addendum. I did the following: quote:This is addendum to the Lease Agreement signed on June 29, 2013, by Owner and Tenant. This document modifies the Lease Agreement as described below. with signatures at the bottom. TraderStav fucked around with this message at 18:51 on May 27, 2014 |
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May 27, 2014 18:21
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DNova posted:People, do not use Home Depot as a contractor. Find yourself a good independent flooring guy. I kind of really want to use Home Depot though... I have thousands in store credit and recently found out I can apparently use the store credit to pay for any contractor I get through them.
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May 28, 2014 19:02
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Zero VGS posted:I kind of really want to use Home Depot though... I have thousands in store credit and recently found out I can apparently use the store credit to pay for any contractor I get through them. It's your money; I'm not in charge of it. Just realize you're paying a referral percentage AND their financing rates, so you're giving Home Depot a nice stack of cash for nothing.
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May 28, 2014 19:34
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In the interest of keeping this thread alive, I figured I'd share an update on my rental property business. I just had my offer on a sweet 3br 1.5ba row home right in the heart of a downtown office business district accepted for 40% less than the original listing price. Listed for 130, seller is in a nursing home and running out of money, dropped to 98 for a quick sale and accepted my offer of 80! With a little (sub 3k worth) of floor refinishing, paint and polish I'm fairly certain I can get 1200 a month in rent as a residence. It's also zoned for dual use and I'm hoping to find someone who would use the downstairs as an office and upstairs as a residence for maybe 1,300.
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Jul 15, 2014 03:41
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That's pretty good, 1.4% on rent of purchase + rehab. Nice one. How did you purchase, cash outright or financing?
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Jul 15, 2014 04:40
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Bloody Queef posted:Listed for 130, seller is in a nursing home and running out of money, dropped to 98 for a quick sale and accepted my offer of 80! I mean, great deal, but you basically just robbed a desperate old lady.
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Jul 15, 2014 19:45
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baquerd posted:I mean, great deal, but you basically just robbed a desperate old lady. I didn't know his situation when I offered 80 on it, just found out after. And he had an attorney advising and representing. I won't lose any sleep over it. Bloody Queef fucked around with this message at 22:08 on Jul 15, 2014 |
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Jul 15, 2014 22:05
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pac man frogs posted:That's pretty good, 1.4% on rent of purchase + rehab. Nice one. How did you purchase, cash outright or financing? Missed this at first sorry. I'm going financing because I'm trying to pick up 1 or 2 more properties by year end so it'll be nice to have the cash for that. With mortgage rates so low, leveraging is a good strategy for me. Fake edit: double post. Had phone posting issues.
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Jul 15, 2014 22:08
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Was asked to join in the thread by the OP. Background on why we want to be rental property owners. Currently own a duplex with a guesthouse in the garden. Guesthouse started as a garage, which previous owners renovated into a home office with a dinky toilet and sink, which I then renovated into a tiled larger bathroom with shower, real vanity, and kitchenette (all but an oven). We were renting this on Airbnb, but a combo of getting tired of cleaning it so often, and seeing what Airbnb has done to the local market, we decided to rent it out long term for a reasonable price. We bought our house for 250,000 USD with 36% down in cash (converting from ISK since very few people will understand our tiny currency). It was recently assessed at 305,000, not a bad increase in 4 years. Renovating the guesthouse was about 4,000 USD. We made around 30,000 USD from Airbnb over 3 years. We now rent the guesthouse for 600 dollars a month, utilities included. Our original mortgage payment was 1,130 USD a month, but lacking good investment vehicles in Iceland, and because we have currency controls preventing us from buying US or EU financial investements, we aggressively paid down our mortgage, which was around 6.75% interest (best that could be had at the time). Now our monthly payments are less than 440 USD, so our guesthouse rent not only covers our mortgage payment, but then some. We have just over 50,000 USD left to pay on this house, so we needed to figure out what to invest our money in next. We talked to many friends, the investment banks here, and decided on buying a smaller rental property. Rental property plan. We wanted to find a property worth around 175,000 USD, with 2 bedrooms. Most around this price point have only one, and here in the area we want to invest in, number of bedrooms matters more than square meterage for what one can ask in rent. We found a nice looking place, owner asking 167, we offered 161, they have til Monday to accept or decline. We will be taking over their loan, and paying the remainder using a low interest loan on our first place taken from our pension fund. Our plan is to pay the minimum on the pension fund loan, and pay down aggressively on the taken over loan which is 6.3% interest. There are currently renters who wish to stay, who are paying 1,175 USD a month, which is right around the average for the area and size. We would like them to stay, rather than having to find new, unproven tenants. Next? Will update when we get an answer on the offer. We are also going to have an independent inspector come in (we can cancel the offer, penalty free, if they find something) but this is the order stuff is done here. And we will ask for payment records and background info on the current renters.
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Jul 25, 2014 14:29
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poopinmymouth posted:We will be taking over their loan Is this common in Iceland? This was huge in the US in the 80s when mortgage rates shot up and banks really cracked down on this by putting due on sale clauses in their paperwork. They got burned by having non vetted buyers not making them mortgage payments.
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Jul 28, 2014 03:05
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I don't know all of the details of owning property in Iceland or even all of the details of your deal, but with the numbers you posted ($161,000, 6.3%, $1175, and assuming 30 years amortization), you will be barely breaking even, even before considering any taxes, fees, insurance, or any maintenance/repairs or vacancies. You know your market better than I do, so maybe speculating on increasing property values is a safe bet, but I've never liked the idea personally.
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Jul 28, 2014 09:42
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Bloody Queef posted:Is this common in Iceland? This was huge in the US in the 80s when mortgage rates shot up and banks really cracked down on this by putting due on sale clauses in their paperwork. They got burned by having non vetted buyers not making them mortgage payments. Yes it is very common here. We still have to be vetted to take over. DNova posted:I don't know all of the details of owning property in Iceland or even all of the details of your deal, but with the numbers you posted ($161,000, 6.3%, $1175, and assuming 30 years amortization), you will be barely breaking even, even before considering any taxes, fees, insurance, or any maintenance/repairs or vacancies. At the beginning, we will just be breaking even. However just like on our primary house, we intend to make extreme payments (budgeting around 5k USD a month as well are rolling in their rental payments) which will quickly bring down the mortgage below the rental income level. We are using this as a long term saving vehicle, because we lack access to other things an american might sink these extra payments into. update She made a counter offer higher than we are willing to go, so we made a counter counter offer halfway between our original, and her counter. It expires tomorrow, but feeling like she will take it. (realtor hinted she had gotten lots of offers, but all lower than our initial one) poopinmymouth fucked around with this message at 12:36 on Jul 28, 2014 |
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Jul 28, 2014 12:00
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poopinmymouth posted:Yes it is very common here. We still have to be vetted to take over. Well, good luck. Do you have property tax there? What are your tax implications of non-labor income in Iceland? Do you mind posting some photos of the place you made an offer on? It seems your mortgages are structured differently than in the US. Our payments stay exactly the same from the start to the end, assuming you don't refinance (which is expensive). But for you, your monthly payment decreases as your balance decreases? So how exactly does the amortization look?
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Jul 28, 2014 12:44
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DNova posted:Well, good luck. Do you have property tax there? What are your tax implications of non-labor income in Iceland? Do you mind posting some photos of the place you made an offer on? Most loans here can be paid off early. They rebalance the monthly payments so that it will still take you the remainder of the loan to pay it off. So for example our 1,300 dollar monthly payments on our original mortgage are now more like 400 dollars because of the extra payments we made. We do have property tax, and we have built it into our calculations, but that's more the nitty gritty which my husband knows more about. Rental income is taxed around 17% I think? I am not 100% sure. I will post some photos after it is more legally ours. Not 100% comfortable doing that now.
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Jul 28, 2014 13:22
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I've started to look at owning rental property, and in IMO you should be looking for a property that is making you money right off the bat. Betting on making large payments to bring your mortgage down and thus your payment seems risky. I don't know your market, but in general a rental property should be making money day 1, encase of vacancy, repair, etc.
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Jul 28, 2014 16:36
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Dial M for MURDER posted:I've started to look at owning rental property, and in IMO you should be looking for a property that is making you money right off the bat. Betting on making large payments to bring your mortgage down and thus your payment seems risky. I don't know your market, but in general a rental property should be making money day 1, encase of vacancy, repair, etc. It's really not the only concern in some markets. That said, I wouldn't touch a deal with numbers like poopinmymouth is looking at. But again, I don't know his market and maybe aggressive appreciation is a safe bet. sleepy gary fucked around with this message at 17:14 on Jul 28, 2014 |
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Jul 28, 2014 17:10
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Dial M for MURDER posted:I've started to look at owning rental property, and in IMO you should be looking for a property that is making you money right off the bat. Betting on making large payments to bring your mortgage down and thus your payment seems risky. I don't know your market, but in general a rental property should be making money day 1, encase of vacancy, repair, etc. That's not really possible in the Icelandic market to buy a place (especially a smaller place) and be making money right off the bat. It's also not betting, as we have historically never made a minimum payment in 4 years. Our average is around 3,000 USD a month, and we have both gotten recent raises. (plus of course the rental income itself from this new property) DNova posted:It's really not the only concern in some markets. That said, I wouldn't touch a deal with numbers like poopinmymouth is looking at. But again, I don't know her market and maybe aggressive appreciation is a safe bet. I'm male.
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Jul 28, 2014 17:11
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poopinmymouth posted:I'm male. Whoops, fixed. Sorry for making assumptions.
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Jul 28, 2014 17:14
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Update time. The apartment was originally listed for 173,200 USD. We put in a bid for 162k She counters asking for 170k (Which is fine, 8k is a big difference) We counter counter with 165,5k (these numbers are much rounder in ISK) AND told the realtor, her father-in-law that this was the max we could get approved for. So what does she do? Counter counter COUNTER offer for 168k, a 2,500 USD difference. I know it's just business but drat this makes me dislike this woman. The only good thing is she is located abroad so I will never have to see her, and after this transaction she is out of the picture forever. Her offer letter, if we sign it before the 24 hours runs out, becomes legally binding for her to sell at that price and us to buy (barring the inspector finding anything). I am leaning toward no, just because she is being so petty, but it's still a reasonable deal, and we have some upcoming life changes that will make our credit worse in the eyes of the bank, so now is a pretty good time to do it.
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Jul 31, 2014 17:04
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poopinmymouth posted:Update time. I would counter again at 165.5k.
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Jul 31, 2014 17:30
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SiGmA_X posted:You're from a non-US nation, and you think a 4 part negotiation is weird?? I guess that is a sign of the times. It use to be very common. I do it basically always when buying used things, and I'm in the US. 4 parts is fine, it's the tiny amount that I object to. If even a single month passes between our offer and her next, that basically eats up the majority of the difference, even if she can get the same amount from the next person.
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Jul 31, 2014 17:50
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This counter counter counter offering happened when I bought my house, and (in my area at least) I think it's because the houses are starting to sell for what people who bought in the bubble owe, after commissions and closing. They fought tooth and nail over a difference of $2500. The balance sheet at closing showed the sellers got back $700 in equity all said and done. They bought the house in 2006.
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Jul 31, 2014 18:15
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So I haven't posted in here, but I thought since the thread is slowing down and I enjoy it. I will share my landlord by accident story. I graduated college in 2004 with no debt. I got a moderately paying job in Los Angeles, and was still living with college buddies in a cheap house. After 6 months of spending way too much in discretionary spending I decided to look for a job in my home town (Bakersfield ca) and put money down on a new development there. Things worked out well, new job, secured a lot in a very nice master planned community in the first phase of development. Secured a loan for $200,000 in addition to my 40,000 down payment (2nd loan from family). First loan was a 5 year ARM at 5.5%. This was a hugely risky thing to do as a young kid a year out of college, but I figured that the roommates and the forded saving of a mortgage and 2nd would be like a forced savings plan. My job moved me in 07, and I have rented since then. I was not able to sell since 2008 and the market crashed. I have been extremely lucky in several areas. I have had only 1 month of vacancy since it became a rental in 2007. My ARM has decreased every year and I just got the notice yesterday that I have a 2.75% interest rate for the upcoming year. I have had to do repairs/painting/cleaning for around $1,000 a year. I have family in the area that keeps a good eye on the house. I would not recommend anyone doing what I did. I am aggressively paying off the mortgage and am now down to only $130,000. I just secured a new renter on a 2 year term and am $300 a month cash flow positive which is enough to cover repairs. I would have sold the house last year when prices finally rebounded, but with the low interest rate I decided to continue renting. Being a long distance landlord is not a good thing, but I have been very fortunate. Without family in the area and the rental being in a highly desired gates community, it could have been a disaster and I could have lost a significant amount of money. I would be very happy to answer questions, but I honestly think I am more of something to avoid doing even though everything worked out well.
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Jul 31, 2014 19:38
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SpclKen posted:So I haven't posted in here, but I thought since the thread is slowing down and I enjoy it. I will share my landlord by accident story. Do you have a property manager? $300 in positive cash flow a month seems very low on a house valued around (I'm assuming based on your other stuff) at least 300k
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Aug 1, 2014 04:59
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It IS very low and I do not have a property manager. I basically became a landlord by default and really was just trying to cover the mortgage and gain equity while the home values were down. With the recession I was underwater, but always had a renter paying the mortgage. The house values have been very volatile in CA. I purchased the house in 2004 for $240k. In 2007 before the crash my house was valued at $340k. In 2009 it plummeted to only $170k. The house is now valued at around $220k and I think I could get $240k for it in my neighborhood. Mortgage/taxes/insurance is $1,250 a month, $130 a month HOA fees, $60 a month lawn maintenance. I get $1,700 in rent. The good news is that my mortgage payment now decreases $600 in the principle every month. So while I am around $300 (actually more like $250) cash flow positive, it's about $850 monthly to the balance sheet building equity. Last year I threw a large amount at the principle, and that coupled with the new interest rate should decrease my mortgage around $200 a month to $1050, but that will not start until October. That could raise my cash flow to around $450 a month, which would give a much better cushion for any potential repairs/vacancies.
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Aug 1, 2014 15:07
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In May I put in an offer on a 2 unit house I planned to rent. The owner of the house had lived in the city and moved away to New York city; she was tired of maintaining the unit and the two tenants were leaving in May and June. I went to do the closing walk through an hour before closing and found someone had gone through while the house had been empty for about 1 month and cut out all of the copper pipe in the basement.
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Aug 1, 2014 16:21
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Gotta get that three bucks a pound man, drug habits don't pay for themselves.
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Aug 1, 2014 17:56
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llamaperl2 posted:In May I put in an offer on a 2 unit house I planned to rent. The owner of the house had lived in the city and moved away to New York city; she was tired of maintaining the unit and the two tenants were leaving in May and June. What did you do? I would have probably made an offer that accounted for 150-200% of the cost to redo the plumbing (with copper). Might have worked out really nicely.
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Aug 1, 2014 18:10
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Originally, I was supposed to close in July and go on vacation starting Aug 5th, which would have given me time to line up a tenant, do some quick fixes, clean it, etc. Except, closing was pushed back by the bank and I was supposed to close today. If I wasn't going on vacation, I would have offered to fix it for a fee, but now I'm just letting the lawyers deal with it and close when I get back from vacation.
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Aug 1, 2014 18:24
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