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Location: Formerly Pleasanton Ca, now in Marietta Ga
10,348 posts, read 8,567,170 times
Reputation: 16693
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Quote:
Originally Posted by Taggerung
Thanks for sharing your experience. Would you recommend a beginner occupant-landlord purchase a fourplex? Or should I stick with a two unit home? How do you feel about renting to section 8 tenants? What should I look for when screening tenants?
Too much to cover. 2 or 4 plex both get owner occupied financing. Learn how to calculate your numbers and recognize different neighborhoods. Pick what works best for you. A buddy got a four plex owner occupied and after 2 years did it again . Those were his first two properties. He networked with other investors, learned a lot. In 5 years he retired in his 30s and travels the world and works with charities.
Before someone chimes in on how much work it is, he set up his own team of managers in the Philippines at $4 hour and they run everything for him. Often he can’t be reached easily so they are self sufficient.
Section 8 is largely dependent on your skill set and how sec 8 is run in your area. Remember you are living next to them. For a beginner I would avoid it ar first.
There are services you can use to run credit checks, criminal check, past evictions etc. don’t fall for sob stories. Have an income requirement and stick to it. It’s a business, be polite but professional. Trust but verify.
I highly recommend you google to see if there are real estate groups that meet up. Also google “house hacking”
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,348 posts, read 8,567,170 times
Reputation: 16693
Quote:
Originally Posted by mathjak107
what we all think will always be based on personal experiences no matter what we invest in ....
i had great success buying commercial lease rights ,,,, meh results with conventional rentals ,,, great outcomes with special situation stuff like buying co-ops with stabilized tenants ... on the other hand i would not ever buy another tax lien sale again , ever .....
Oh come on. I just heard a guy on the radio today telling me how I can make lots of money with tax liens if I go to his workshop
being a free ride on someone elses money....what a novel idea.
So How does one go about that....hmmmm....
1: Buy the property outright. cash down.
2: each year claim depreciation
2.5: Make sure there is a hefty deposit fee so you can get the interest from it.
3: have the tenant be any or all the following: Hard of hearing ( so you can make as much noise as you want) : Willing to do all your lawn care as part of the lease agreement. Have them pay all your shared utilities. Make them bring their own appliances...
4: Increase their rent so you can go off to a destination vacation.
5: Dont let them have pets or any visitors what so ever. Remember you want them isolated so you can manipulate them.
Now with all that dribble out of the way....
Ignore the folks who share the Nightmare tenant stories....they are the landlords who probably had the very ideas written above for how they wanted the transaction to go.
Tenants are NOT free rides....think of them as investors...part of your long term goal. Treat them right and they'll respect the property.
you can do well with real estate but some properties will require more hands on and attention making it less of a passive investment and more like owning a business .
being a free ride on someone elses money....what a novel idea.
So How does one go about that....hmmmm....
1: Buy the property outright. cash down.
2: each year claim depreciation
2.5: Make sure there is a hefty deposit fee so you can get the interest from it.
3: have the tenant be any or all the following: Hard of hearing ( so you can make as much noise as you want) : Willing to do all your lawn care as part of the lease agreement. Have them pay all your shared utilities. Make them bring their own appliances...
4: Increase their rent so you can go off to a destination vacation.
5: Dont let them have pets or any visitors what so ever. Remember you want them isolated so you can manipulate them.
Now with all that dribble out of the way....
Ignore the folks who share the Nightmare tenant stories....they are the landlords who probably had the very ideas written above for how they wanted the transaction to go. Tenants are NOT free rides....think of them as investors...part of your long term goal. Treat them right and they'll respect the property.
in our case they were like investors ... we had to buy out their leases for 100k so we could sell the co-op apartments since they were original stabilized tenants .
Everyone has had some great advice........as far as being a landlord if you can stomach it then going the duplex route is the best case scenario to be in if you are the live in landlord.
You are there first hand to witness everything which helps tremendously with showing, fixing issues firsthand and many other advantages. That realtor or friend that helps keep an eye on your place can't drive by everyday if you are a distant landlord.
Again search these threads and Google is your best friend. It is definitely not for everyone but it has its rewards. Don't just look for the dollar signs also. Sometimes it is better to be patient and find that perfect fit. When you find that perfect renter, nurture the relationship and don't price them out each year with increases. A tenant that does not tear a place up is worth their weight in gold in my opinion.
Remember your lease should be constantly evolving. Technology and innovation are becoming creative tools for some of these tenants............scenario: a very close friend has a two bedroom rented to a really nice guy in our beachside community. They just happened to find out with a little detective work that he was subletting a room on Air B and B. He had been doing this for over a year. Luckily they put a stop to it as the city has very strict policy's on short term rentals and they could of been fined heavily.
I have been a LL, never want to do that again. Section 8 sounds good, guaranteed rent -- UNTIL they get kicked off Sec. 8 and then you are stuck with tenants who can't afford the rent. Good luck with that.
I am now renting in a 3-plex that is about to be sold. On paper, it looks like the rent will cover the mortgage payment - yippee!! Except - huge oil heat bill (old house, very little insulation) -- insurance is way more than it would be for a SFH -- property taxes -- whole house needs scraping and painting -- roof will need to be replaced at some point -- ancient windows -- not to mention all the cosmetic work that needs to be done in the owner's apt. (nothing has been done in 20 years or so). I feel kinda bad for the young couple that is buying it.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,348 posts, read 8,567,170 times
Reputation: 16693
Quote:
Originally Posted by mathjak107
in our case they were like investors ... we had to buy out their leases for 100k so we could sell the co-op apartments since they were original stabilized tenants .
Tell us again how much money you netted out of the whole deal? Not just what sounds like a negative amount you lost on real estate.
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