Would You Live There?
Hi all: My husband and I have been having a debate. We have a SFH we are rehabing and may rent or sell if price is right. I have gone to look at other properties and found a few I liked. I took him to see them.
They needed work, cosmetic, one needed roof work and gutters all around. He thought the one duplex looked like the foundation was in poor condition. One of duplexes had renters who were slobs and did not inform the current owner that the toilet was leaking so the ceiling is falling down in the dining room.
The prices of these duplexes were good, one was 40,000 the other 50,000. Rents for each one would be $400 per side so the numbers were good.
I am having trouble convincing him that sometimes you can buy something that you would not care to live in yourself but is not a slum either. Especially if cash flow is good.
Am i wrong about this? I see potential in these places and all he sees are problems. Any advice?
Kim
I own many properties and have sold many properties. I would live in all of the houses that I have owned if they were in a different location. I was told by my REA a long time ago "i cannot place my values on other people" These neighborhoods have been around longer than I've been alive. People are constantly moving in and out of them. I have learned that slumlords' properties get treated like slums. But give a family a nice home to live in and they treat it like it is their own. I may get many stupid calls for little things to my service but that shows the tenants care about where they live.
Lori
[addsig]
Hey,
If you would not live in the house (not the neighborhood) then it is a slum. All my houses are clean and well maintained and that is the indicator of it is a slum or not.
Boy I wish I could pick up duplexes at 40-50k
I think as entrepenaurs most of us would live out of our car if we had to, I sure would.
GL
"I would not live there?" Or "I just love it?"
Two of the most dreaded statements an investor can make!
"I would not live there?"
This phrase will cause an investor to walk away from a great deal -Think about this for a moment! "Who cares that you would not live there".
You should be asking yourself who would live there?
What can I do to the property to make someone want to live there?
How much profit will I make from the deal?
"I just love it?"
As an investor this statement will almost guarantee failure when you buy real estate for investment purposes!
Just cause you love it does not indicate the market will love it.
Maybe I am taking the question too literal, but I sure wouldn't use if I would live there or not as a standard. My properties are all well maintained good solid properties, I'm not ashamed or embarrassed to have my name assosiated with any of them, but I wouldn't live in any of them either. For me the question is more like, "would I have lived there when I was in my early 20s?"
Thanks for replies.
I see potential in these properties. I know I have the knack to make them look good, a little paint goes a long way.
It is my husband who I have to convince of this. He thinks he has to do all of the work himself and I know it is cheaper to do it that way but we are not roofers or electrcians. He is learning, but not confident enough.
We live in an area where the opportunities are great I think, many homes in the 25K to 40K range and duplexes from 40K-50K and up. We are crazy not to take advantage of this now. The properties are not perfect but what is in life?!
Thanks, I just needed to vent a little.
Kim
kasm,
If I was you I would start looking for handymen in your area. If you can make contacts for people to handle the property maintance work than hopefully that will convince your husband that he will not have to do all the work. Another approach I would do is to offer your husband something with the money your are going to make. For example, I offered my wife $50 a month to use on what ever she likes.
Believe me when I tell you this, I would kill for prices like that. Don't pass up the opportunity. Yes landlording can be a pain once in awhile, like when I hurricane hits, but it is totally worth it.
You are going to constantly get remarks from people that say it can't be done. I've become outstanding at rebutting people. I can't tell you how many conversations with people that began with them telling me lanlording is to hard and by the end of the conversation they want to be my partner. Information is power. I read constantly and I reccommend you do also.
Don't wait. Everyday you wait you lose money.
Kyle Burke