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  • Any landlords/invesment property owners around?

    The wife and I are trying to figure out what to do. I am thinking about investing in an apartment building and living in/managing it. We have saved enough to make a healthy down payment on a single family house now or should have enough in about a year and a half to get something with several units.

    I grew up pretty poor. My childhood was great and I have no complaints for going without, but I did not learn a lot about managing or investing money from my parents. I am very overwhelmed and don't even know where to start, but I do know that our window of opportunity to start the ball rolling on something bigger will tighten up once we have kids.

    Any advice or stories about how you may or may not have succeeded in accumulating property, whether be collecting single family dwellings you now rent or running multi unit buildings would be greatly appreciated.

    Thanks!!

    Eli
    A good carpenter makes few mistakes, a great carpenter can fix his own.

  • #2
    Re: Any landlords/invesment property owners around?

    If you are going to live in a multi unit, be ready to be involved in every little spat or disturbance that goes on with the tenants. I had a number of multi unit buildings but didn't live in any of them, and got calls all the time about what the "other" tenant was up to. I only have one duplex now, as well as a number of houses because of this.
    You might want to check and see if there is a property owners association in your area to join. They can be a valuable tool to see what people in your area are going through. Renters generally act like they are living in a hotel, and do not take care of things like they own them. Don't assume that if you are in a better area that the tenants automatically will be higher quality. I've seen $1,500 a month units trashed just as bad as the $450 ones. They just break more expensive stuff.
    You should check prevailing rents in the area, and plan on 70 % of this value each month to make sure you can cover all expenses. If you are not going to do the grunt work on the building, plan on having even more saved up to cover expenses.
    You also need to make sure you know the area you are planning on buying into, around here, just going a few blocks makes a huge difference in the quality of the people.
    There are a million other things to consider, and it will take time to learn, and some things you will learn though hard knocks. Good luck.

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    • #3
      Re: Any landlords/invesment property owners around?

      Multi family units will probably earn you the most income, single family homes are limited in return on investment. Many variables to consider, taxes, utilities, upkeep (lawn and property management), etc. My greatest concern is that you become well educated with all the laws having to do with renting. Tenant rights and your obligations. Background checks on potential renters can help, collecting the proper security in advance, keeping the relationship professional (you are not there to make friends, it is a business), having them sign the proper documents. Some states or towns allow for a contract which has the tenant take care of any repair under a certain amount of money, let's say $100.00 for example. This prevents them from harassing you for minor repairs. The laws can cost you a fortune or protect you from losing everything, don't focus on the potential wealth and ignore the necessary tools to get and stay there. Good luck.

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      • #4
        Re: Any landlords/invesment property owners around?

        i don't collect single family units for rental income. i flip them. buy low, make smallest improvements that improve the property's marketability and price it aggressively to get out fast. multi family units are good revenue producers. know your residential property law. start small with a small multi you live in to keep tabs on things and to get experience on the things that can happen with tenants. remember, you never get rich on one deal. it's a marathon, not a sprint. good luck.
        there's a solution to every problem.....you just have to be willing to find it.

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        • #5
          Re: Any landlords/invesment property owners around?

          Over the years I have bought, sold and managed a bunch of multi-family units. I would never live in one though as you would end up with zero personal time. Depending on the units you are looking at this is a good time to invest in apartment units as so many people are losing their homes. The down side is with the current direction we are going the Administration may decided to do something weird with the housing market. Above all be careful of areas with real strict rent control as I have seen way too many owners lose their property because of them.

          Good luck-Mark
          "Somewhere a Village is Missing Twelve Idiots!" - Casey Anthony

          I never lost a cent on the jobs I didn't get!

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          • #6
            Re: Any landlords/invesment property owners around?

            Originally posted by FINER9998 View Post
            i don't collect single family units for rental income. i flip them. buy low, make smallest improvements that improve the property's marketability and price it aggressively to get out fast. multi family units are good revenue producers. know your residential property law. start small with a small multi you live in to keep tabs on things and to get experience on the things that can happen with tenants. remember, you never get rich on one deal. it's a marathon, not a sprint. good luck.
            I like this idea better than the income property scenario. Heck, you could live in the place while you improved it. I've got a brother that's built and sold/ bought and renovated. He made bank on every deal he did.
            I'm on "The List" and I love it!!

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            • #7
              Re: Any landlords/invesment property owners around?

              Originally posted by ToUtahNow View Post
              The down side is with the current direction we are going the Administration may decided to do something weird with the housing market. Above all be careful of areas with real strict rent control as I have seen way too many owners lose their property because of them.

              Good luck-Mark
              Thanks! I am worried about inflation too. If the dollar value plummets the way some folks are predicting...It's all a scary proposition right now but inaction seems like the worst choice. I have been thinking maybe we should just get a fixer upper and live in it until the market rebounds, not so much as an investment.

              I don't mind hard work, but the headaches of being an onsite landlord seems a bit much, especially after a few people mentioned it being a pain.

              What are other things people are investing in these days?

              Eli
              A good carpenter makes few mistakes, a great carpenter can fix his own.

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