To Build Or Buy A 2-4 Plex?
I will be moving back to the Fargo area next spring, to attend NDSU, after serving in the Navy. I know that I want to purchase a 2-4-plex, and would like to live in one unit while renting out the unoccupied. I have up to 170k to work with. Any suggestions or opinions on this idea would be greatly appreciated. As I only own one single family rental property currently, I’m new at this game. Is new construction a good idea, or should I stick with purchasing an existing property?
Thanks alot guys. I appreciate your advice.
Hi John: 170K will buy you an older but well kept 4 plex in F-M, Dilworth or West Fago. I think it is a great plan for a single guy...you should be able to find a deal where the property makes all the payments and you live for free.
I have a few holdings in the FM market. The appreciation rate is slow, but they are far better cash-flowing units than in the twin cities.
New construction is tuff in Fargo for two reasons: 1. large developers for both single and multi units buy land and materials in quantitites (and less cost) than what us small guys can. 2. Special assessments are huge...sometimes as much as the price of the lot.
Money Orders are better than checks when it comes to recieving your funds, however, paper trails are harder to verify.
If you are doing a RTO or have some kind of option then a money order is not as good as a check because with a check you show a paper trail which lenders may require when the option is exercised
If you are going to require money orders then you might want to stress to the tenants that they need to keep their money order receipts just in case they get lost in the mail. I saw a lease once of a smart property manager that allowed the tenants to send the rent in certified mail (or one of those methods where it could be tracked) via the USPS and subtract the amount from the rent. I have already run into a "lost" money order in the mail situation.
I wish all my tenants used a computer....
Some of the older ones still like to drop by our office with an envelop containing checks, cash or money orders.
Monkfish,
How do you set up such a system? Do you remove all the money each month, since your tenants now have the account number?
I have never heard of them, but their pricing is not bad if it is a robust program like you say. I did not look into the features in great detail.
It is a little cheaper than the software company that I work for.
Sometimes you get what you pay for. You could get much cheaper programs: QuickBooks, Dr. LandLord, Quicken, Peachtree, but they will not give you good property management features in my opinion.
If you purchase it let me know how it works out for you.
Jason
[ Edited by jlmnop10 on Date 11/04/2005 ]
It seems expandable to the point where if i ever need to bring in employees i can setup network seats and get them all accessing a central database. It also has a general ledger add-on. It looks nice, when i get closer to buying my first piece of property i intend on getting this one unless someone else has some better opinions..
I had run a demo version of landlord max and it seemed pretty good but lacked general ledger features and networking capabilities.
One thing I would check before you purchase it is support. I did not see a price for this on their website, but i did not look into it for a great amount of time either. Sometimes companies will sell the software for cheap and then get you with the training and support costs.
Let me know what you find out.
Google Mike Butler...he is a local yocal that does a lot of lease-to-own and has created his own rental software...BEWARE he has a cheesy ad but many people have purchased it.