<< Back to all Blogs
Login or Create your own free blog
Home > Page: 2

Viewing the '3 units-rentals' Category

Investing questions and 'financial freedom date' thoughts

June 2nd, 2016 at 08:27 am

hi all

I was thinking of doing the 3 stock portfolio plan from Bogleheads with my money and just sticking to that with the majority of investing and then using a 'smaller amount' which is undefined yet to try other investments out or pursue other (Stock) investments. What do you guys do?

and thinking on 'financial freedom'.If no big hiccups I should have all these properties paid off by June 2018.. but realistically w this big house mortgage (currently $300k) I will not feel 'financially free'.. even if I reach my goal of $450k investing too. I need to do something about this mortgage. I also am thinking I need a year w this new property management company to feel good too. I also need to have a 'passionate goal or plan' and really do not have that (yet). My goal is to pay off all these properties and get the cash flow but then what

Working on all the above.. just posting..

Currently no plans to move from where I live now but just doing a quick check reveals several homes which are on the bike path (in other neighboring towns) with large lots, older homes with hardwood floors etc.. which I like and are less $$ than the house I live in now.. One even had a coach house which would be sortof fun and I would love to be on the bike path or nearer to downtown. The hsoue I have now ... though near the downtown of our town is NOT in the downtown and again the people are less friendly..

Got that unit approved for Section 8

May 31st, 2016 at 03:29 pm

Hi all

Turned out I got that house approved for Section 8 after having been previously pulled from the program. There were some very minor fixes (new screen door, screw on circuit breaker covers) to be done per the inspector and then the lease will be signed and she will move in. This will likely be another very long term renter which would be great.Target move in is Friday.

No takers on the vacant apartment but that lady is moving out today and it will be truly vacant tomorrow. We have an application pending and several more showings set up so it should rent soon. Hoping the existing application works out. Apparently the unit is in very good shape and should need no major or minor fix up . just a little cleaning.

We have one other guy in the 3 units whose lease ended 4/30 but he said he wanted to stay and sign a 6 month lease. We said either sign a year or move out and gave him 2 months to decide and during that 2 months he can pay $50 more. We will force the issue this month and either get him on a 9 month or longer lease or get him moved out so we can rent to someone else. I do not want to sign a 6 month lease that ends in December.

and then no other renewals until September and no large work needed.. so hoping to pile on the cash flow. I suspect that many of the 'later lease endings' will renew too.

All real estate tax 1st payments made

I have about $4k more to 'pay back' the rental emergency fund. I will let the rents pay the rest of that back and estimate that happening in 3 months so my savings will continue in earnest starting next paycheck. My savings comes from my W2 income. All rental monies stay in the LLC at this point.


Rental updates, job update and life

May 27th, 2016 at 11:33 am

Hi all

We have someone who looks good for that vacant house. Section 8 inspection Tuesday. This was the house that was REMOVED from Section 8 due to a bad history from the owner. I got Section 8 reinstated on another house w this issue.. hoping to get the same here.. No rent increase.. in fact $20 less but filled same month, we can ask for a rent increase in a year and generally s8 are much longer term tenants. vacancy is REALLY expensive so trying to avoid that at all costs.. turn over is really expensive too . .I just spent almost $2k getting this house fixed up. do not want it turning over in a year.

Person for 3 unit fell through and chose a place nearer to her work. We are still showing it and still aiming to fill for the first. Fingers crossed

My boss says she IS going to renew me . My contract is up July 7. Not sure for 6 months or longer. I asked for a year and talked to her boss who says he has budget.. and in fact I am already in this budget through year end and he will be put me in for next year. project I am on is likely to extent into mid next year

After July I will have maxed the 401k.. so my paycheck will go way up. What ever that 'difference' is will go directly into savings/investments

HIGH repair month last month and missing 1 month rent.. but still getting NETS of almost $6000. I had almost $3000 of repair maintenance costs last month.. upsetting but not avoidable.. house fix up..fence.. water heater.. sewer rodding.. were among some of the larger items.

I am considering ending a relationship and just sortof moving on. always upsetting/scary/stressful to end a relationship but does not appear to be 'long term' and sortof feeling I am wasting my time and feeling 'stalled'.. just a lot of stuff..

About it for now. despite some bumps here and there still thrilled with new management company and my plan.

For the end of this year I will still save as much as I can.. invest.. develop systems/ processes for the rentals and continue to work on creative ideas to get this house (where I live) paid down significantly..

what a feeling it will be next year this time when I will be essentially 1 year from having all properties paid in full and likely receiving over $8000 cash flow.

Apartment in 3 units rented

May 12th, 2016 at 02:00 pm

Good news..

Apartment in 3 units was rented for June 1. Got a $50 increase. So should be no lag time or just a few days lag time between move out and move in. This is the second time they rented the a unit before the unit vacated

All work done at the house that we are renting (well steam cleaning happening today and final work so will be done by end of day) I feel concerned I went with too dark a color. I will look at it all cleaned up Saturday and with lightbulbs. Showings start tomorrow. Fingers crossed.

Tenant in 2 flat. We will sign to a new lease.. 9 months. no rent increase (manager feels she can not afford it).. all rent due by the 15th if paid late gets a $75 late fee.


Rental updates, job updates, misc

May 10th, 2016 at 09:34 am

Hi all

I got the 2 flat.. 14% CAP rate. upper unit is up for renewal and wants to stay. She currently has until the 15th to pay her rent and gets no late fee until the 30th. I do not like that at all. We are going to give hew a new lease and set it for rent due date the 1st, late after the 5th and if she can not accommodate that the latest we will go is the 8th for rent due with no late fee. I need to be able to depend on the cash flow. Currently she has not paid rent and I feel angry with it but we will fix it with her or find someone else. REAL good time to get new tenants. I will raise the rent slightly on her too.. so far rent increases for the year have totalled $110 and we are listing that house at $90 more rent than what it was and the 3 unit at $50 more rent so hoping to get good increase there.

Other than that all rents in.. and homes are going very well.

They are showing the 3 unit that is up 6/1 now and getting lots of showings at a $50 increase in rent
and will show the house that was recently vacated starting Thursday (have a list of people who want to see it). House is being repainted and minor fix up and cleaning. Turning over this house with top/bottom paint and cleaning, minor fix and carpet clean is expected to cost $2000+. I am so glad this firm is getting better long term tenants and so glad I am LEARNING about costs and how to cut them. Feeling the best I have ever with the homes and plan.

Speaking of the plan. I need to increase my rental emergency fund with all the homes to $25k. I will work on that gradually but that is my new goal. I need that to avoid cutting in to much my cash flow per month when I start to rely on it if I do major fix up works

Still looking at $7-8000 net based on CURRENT RENTS (now).. Wow. did not think I would come so far so fast

Still no plan to pay down house (my own) or reduce housing costs.. monthly mortgage is $2700 but I pay $450 extra.. that is a big chunk if I only rely on the rental income.. I want my housing cost lower.

My contract at work is up July 7.. project I am running is expanding and has at least til November to go. I iwll ask for a 6 month or more renewal. Actually my plan is to talk to sales and get a read on what else they are trying to sell to this customer and get an extension for a year or past Christmas.

Paying back my rental emergency fund has crimped my savings for last month and this month but will resume regular savings next month.

About all for right now. Have a good day folks

got news on the Section 8 rent increase

April 28th, 2016 at 02:50 pm

Hi all

Got news on the section 8 rent increase on that house I was going to sell. I got $50 a month increase but they say to apply again next year. I was hoping for a $100. I would get more if I had a new tenant but my current tenant .. her kids all moved out so she is on a 'smaller voucher' .. she has a 2 bedroom voucher vs a 3 bedroom so section 8 is limited. The house is a large 3 bedroom.

Still a good increase..especially for no work and got $50 more. We will try next year and hopefully she stays but if not I can repaint, do fix up and expect to rent it for probably $1200 or more.. current rent WITH INCREASE is $1075.

Rent increases so far this year are $110/month

2 flat and rental updates

April 27th, 2016 at 09:10 am

Hi guys

2 flat closes Friday. 14% cap rate..

Got 2 renewals at the 3 units and 2 people moving 5/31

Got 1 sudden move May 1 (or this weekend) at a house . I will look to turn that around asap. We get keys this weekend

My goal was to raise rents (across all units ) by $600 this year. So far we are at $60 and got room to raise for the NEW tenants at the 3 units (start them at $50 more hopefully) and then at the house that is vacating ...hoping to start people at $100 more if I got section 8 or maybe $50 more if I do not. and still waiting to see if I get a rent raised on that Section 8 house I decided to keep. Hoping a lot more people STAY this year so we are using our judgement when we raised rents on existing tenants (we had alot of turnover in homes last year)

Still on track with all the fix up work Should have that paid off by June 15 and back to $15k emergency fund. Hoomes with new siding and roof and landscaping and driveways look great. Doing the fix up work took a dent out of my monthly savings for April and will impact May as well.

Those fix up items were my last big items this year.. now costs will be limited to general maintenance and rental turnovers

Exciting to see how I turn out this year with my total nets..

Updates , new 2 flat, taxes, rentals

April 17th, 2016 at 02:13 pm

HI all

looks like I will close on that 2 flat at the end of this week (hoping so). had to get a new attorney (seller side) the attorney got sick and file was dropped.. we just ordered title Friday.. anyway hoping

The work on the homes looks great.. 3 driveways (where there were none), roof and siding and major seeding where yard got ripped up due to prior foundation work

I have money or credit for all of it

tax refund came in at $9200 and I am setting up with an attorney next week to figure out ways to save on taxes next year

I owe my rental emergency fund $13990. Entire $9200 will go towards that and then I have approx $4500 in repairs on a card that need to be paid off (linked to the large repairs). I will pay that off next month which leaves me with about $5k left to replenish the emergency fund with. That should take one more month

The only other large items I want for the homes are siding the 3 units (not a need and not scheduled but they have really old siding). Quote is approx $13k

One of my tenant suddenly got custody of their kids (the dad) ex wife ill or something so he is moving out immediately to a large home. the property manager is taking his security and letting him know he is on the hook for rent until we find someone else. Hopefully that will be soon. I predict carpet clean, paint and clean with not a lot of fix up. Manager thinks he can get $65/month higher rent. the guy is predicting he will be out next week or mid the week after. We will see. Home will be advertised as soon as this guy gives formal notice (expected Monday). and I have already notifed my 'crew' of paint/fix up guys

Got 2 move outs end of May (at the 3 units)

I am really keeping track of vacancy and 'time to fill' and 'cost to fill' this year as I near the time when these homes will be paid off

I paid $985 to an attorney to do a wage garnishment suit against that one tenant from last year. he works for the gas company (so good candidate for this) and I am trying it out. I have never pursued wage garnishment, bank levy before. $985 is my total cost and they add that and more on to the tenant balance. It would be great if that worked out and was a viable option for me. If it does not I have learned a valuable lesson.

So far NETS from homes have been the following (net of everything-EXCEPT the large $22k repairs which are funded from a different fund). I think I will expand my repair fund to $20k and keep it at that. Another goal for this year. I get section 8 on the first and the rest averages around the 18th

FIguring out vacancy and time to fill and time to fix up will be key to be determining or feeling good that this imcome (or whatever lower amount of this I decide) can be counted on monthly. I allocate $15,200 in the rentals yearly budget for repairs AND vacancy (vacancy covers the costs associated with lack of rent, fix up to turn a unit over, and property manager extra fee to fill). I will see how that figure lines up with actuals this year

Approx monthly nets so far this year (IF homes were paid off.. which will happen 6/2018.. currently all overage goes towards paying the homes off)..

Jan- 5750
Feb- 5300
March- 6725
April- 7300

My budget calls for an average of $6500 a month.

Updates on rentals

April 7th, 2016 at 06:06 am

Hi all

All rents in. I am SO THRILLED with this new company. They enforce late fees. rents come in sooner. I am hoping for less vacancy and faster filling of units (I will decide if that improved by year end but I think it will)

Tax results today. My accountant says betweeen $5-10k and was going to work on them again.. Appointment is at 10am.. So fingers crossed for the 10k figure. I took out $14k from my $15k emergency fund for rentals to pay for the siding, roofs, driveways, seeding work. Good investment I think. not done yet. the rain/snow has delayed things. That is ok with me as it gives me more time to pay. My tax refund will go towards that and then predicting 2-3 months to rebuild my fund up

Suburban rust fix should be done TODAY. excited to see it. again I was referred to a long time client of my accountant so I am sure it will be done right or fixed if not. no one wants to make their accountant look bad.

I looked at my #s again and not sure what I wrote before but I fixed an error in my spreadsheet and hre is what it is

IF the homes/units were paid off I would have made the following

2014 $20k
2015 $34k

Last year I actually got LESS RENT than 2014 I think due to vacancy poor management . just nightmares. The only reason my net was more was because of less repair costs

2014 was my big fix up-repair-improve year

and this year I am targetting $60k This year before the subtraction of the $22k improvements (which will show this month) I was at $18k net for Jan-Feb-March. this subtraction will take it down to negative and then I have April thru end of year to make that back up and reach $60k. I get rents deposited on the 15th of each month

I really want to get it up to $70-80k a year..

Next year will try for higher.. key factors are vacancy , repairs, time to fill vacant units

Thrilled with new managment company. bringing me to new heights and making me see and think my 5 year goal can be a reality

Literally I am starting to wonder. hey should I do a career change, take some classes.. feels like the world is opening up.. investigating hobbies.. all of that

Hope to hear on that Section 8 rent increase this week or early next. This is on that home I was going to sell then got some advice from here and others and decided just to keep it. it is fixed up, rented, new manager says it will not be hard to rent. so why not keep it.. and if I can get a rent increase of $100 or more with the current tenant .. even better!

I know I am not at June 2018 yet (5 year goal end date) and there are still upcoming challenges but it feels like I am OVER THE HUMP and no longer climbing the mountain but managing my way downward.

More rental updtes

March 23rd, 2016 at 06:44 pm

Hi all

Continuing to feel great with my property manager. Already calling and clarifying the 2 people whose leases are up 4/31.. looks good at least 1 will stay (yay fingers crossed). I am really thinking I will have much less turnover this year and lower costs

Visited the homes we are doing the siding, roof, driveways on and met the tenants . very nice people and were excited for the improvements..

Just feeling good

So goal this year is $60k net and then next year will look to improve on whereever I end up

I am having to pay some $20k in improvements (or wanting to) so for me to hit $60k net I have to actually make $80k net. so we shall see. That is an average of $6666 a month NET.. seems a PRETTY AGGRESSIVE GOAL right now but we will see..better to shoot for the stars and hit the moon

Key is keep those repair costs down and units filled

Thrilled with it looking like things are turning around

ALSO now that I control all large repairs and get CALLED on every minor repair over $100.. I have better control and am forming sortof a team of different trades people I trust and have reasonable rates.

Loving it

Got to get this primary house paid down or something by 6/2018

I took in a 15 year loan but that makes the payments high which I will not want if I scale back. My mortgage if I do not pay extra is $2750 a month.

Dad still doing 'well' and seems stabilized. VERY glad I moved him to Silverado..

the 2 flat is a GO!! trying to close end of the month. seller contract.. almost 14.5% cap rate.. my goal will be to pay off by 9/2018

Rental nets from years past-true numbers

March 21st, 2016 at 08:43 am

HI all

Just reading through my rental net sheets from years past. My goal is to smooth out the homes this year and next and realistically complete any lingering 'large repair/upgrade items' this year and then go to maintenance mode

The homes had a lot deferred maintenance items when they were bought. some large (roofs whatever). I got them at super reduced price but realizing I maybe could have gotten them lower (with wht I know now or have learned) .. maybe not. in either case.. I GOT the homes which is a big step in and of itself

Realize that currently all net goes to the mortgages(I am paying these off on a SUPER accelerated rate). 6 homes already paid off, 3 units will be paid off 3/2018

So, my NET if I did not have a mortgage was

2014- $20945 (w repairs/vacancy charges of $50884)
2015- $34288 (w repair/ vacancy charges of $37674)

I am going to set a goal to hit $60k NET (before mortgage for this year). Looking at spreadsheets my major factors that I can control are VACANCY and REPAIRS. I wil track those closely and can more easily do so with the new manager

I am forecasting approx $20k of large repair costs outside of normal wear and tear. which includes roof, siding, driveways. I am starting that this week. I have no other large repairs forecasted and day to day repairs are runnning WAY LESS than last year. I still want to reduce my large repair costs year to year and am coming to the end of the list. realistially this siding/roof I do not HAVE to do but thimk it makes sense long term

A learning year and probably a wild ride but got to get this smoothed out so I can depend on it more. It has been a wild 2.5 years so far.


Net rents update-highest month so far.

March 17th, 2016 at 07:02 am

HI all

net rents update

Highest month so far

First 2 months this year (with 2 vacancies) was running at $5100 average (NET) before paying mortgage

This month (all units full) I am at $7387 NEt (before mortgage)

I will continue to track this but hoping for a continued upward trend from last year and with better management I should have it

My management fee is lower w this new company 7% down to 5% of rents and repairs costs are MUCH LOWER (and less frequent) and I have increased collection of rents and late fees .. so so far so good. I am hoping the BIG turn around will be in finding better tenants who stay longer. This management company has placed 3 people so far for me (and all seem good but time will tell). One was a replacement tenant (turning over a unit with 6 days downtime!!) and 2 were just to fill vacancies.. one from an eviction. one with a new property.

Last year I had extreme vacancy and legal costs and lower rents because of it.

23 months to go to pay off these 2 3 units.. so I will use what I have learned and work w this management company to continue this upward trend so reach my goals

I think I will reach my net rents goal but still stuck somewhat with owing this $300k on my primary house I do not like owing that much and am wanting to find ways to get that paid down or owe less. BY 6/2018 at current trend. I will still owe like $260k which will make me feel uneasy to leave my higher dollar job or relax. I want that paid down considering (to less than 100k) and maybe then refinnance to a lower payment?

A lot can happen in 2 years though so onword!

Where do all these net rents go right now? My mortgage payment is $5094 for the 3 units and the rest I either pull out to add to savings or will start using to take care of these large improvements I want to do this year.. so I am not pulling from the homes yet


Got my 401k match and possible new 2 flat

March 14th, 2016 at 03:28 pm

HI all
I got my 401k match from last year. approx $3650.. nice!

I am trying to get my entire 401k in this year by July in case my contract ends (but do not think it will). it also forces me to live on much less which is good and I will continue at once I am complete w the 401k deductions (approx July)

I am looking at a 2 flat, contract sale
occupied , price $72,500, total rent $1750 ($900 and $850)
With all expenses (water bill, tax, maintenance escrow, insurance and mgmt) the cap rate is over 14%. Seller will sell with $25k down and finance the rest over 4 years,. payments $1018

I did an inspection (cost $450) and seller is fixing a big list of items I asked for . I should say this is a seller referred by the property manager and she is wanting to sell all her properties and move to a different area. First floor unit just prepped for new tenant too.

So i will re-inspect property Friday (my list of items) and see if it makes sense then.

Inspections are SO WORTH it. even if listing is 'as is'. I wish I had done then on the '6 homes' but live and learn. Smile


Rental update, all units filled

March 9th, 2016 at 07:30 am

Rental update

All units filled (been a long time saying that) but finally there and all rents IN and so much smoothing out. I am tracking net now each month and so exciting to see the changes year to year. Now hopefully things will just smooth out and I will jhave normal renewals and move outs not this drama and having to evict people etc.. and lost rent..hoping this year is my best year ever actually and I think it will be. Section 8 lady moved in yesterday and hoping she stays long (and works out). I will do those driveways and siding likely in April. .. got quotes and contractors lined up

Work is still going well.. my contract is up 7/7/16 but the project is going to way exceed that timeline so unless there are any slip ups I should be renewed

I should get my 3% match to my 401k (from last year) next month.. interested to see what it is

About it. Dad is still doing well in memory care.. cost approx $7150 a month. he is doing well but the decline is quick. he is now hardly able to get up from a chair on his own and talks less and less.. but a VERY good place.. less drama and homey. very nice.

About it for right now

getting warmer which is great

Good news updates, rentals (govt payoff bombshell at least to me)

March 7th, 2016 at 09:07 am

Hi all

Good news updates. I got the house approved (need to a few minor fixes) from Section 8 but guess what. The inspector called the manager personally on his cell and told him he only let the house back in the program because of HIM and then the manager told me that he regularly hosts a golf outing for section 8, contributes to this guys sister's campaign etc and considers it the cost of doing business.. Wow. did not know that but another reason I am happy I switched to this guy
So lease signing should be this week and them move in this weekend

Rent is going up $20 a month

New manager is also submitting my victorian for a rent increase. lady is on a smaller voucher than the size of the house so rent is real low ($1025)

when I tried for a rent increase myself and through the old manager I was turned down last year. hopefully this will work. if so it will further justify my keeping that house and switching the property manager

Did all my tax stuff and sent to the accountant. Hoping to have a rough estimate of refund this week

He is doing the not for profit and Dad's taxes too this year

My not for profit grossed $76k last year . our largest year yet

Looking at costs from last year and doing taxes really helped me see the difference year to year and easy ways to keep track of things. taxes will be easy next year w this new property managers reports

HOMES really smoothing out and will be a big income source for me

Doing siding of a house and 3 car garage this year along with a roof and 3 new driveways. These items will be my big money spend this year but I think will make the homes look nicer, rent easier and all are long term fixes.

All is good

My plan (5 year plan) is working out!!!


Updates, rental and 401k

February 29th, 2016 at 08:26 am

HI all

Quick updates

ALMOST done w gathering all info from taxes. Hoping to get LOTs back but not sure this year as I have the '6 homes payoff' and more income and other stuff. Hopefully my accountant can give me a rough idea in a few days

I decided NOT to sell the Victorian house. at least not right now. It is rented, does well and I have done so much large fix up (new roof, soffits, gutters etc) that I do not think it makes sense right now PLUS I found a way to ask Section 8 for a rent increase even with the tenant in there

We have a potential tenant for that one vacant house.. we will hope to firm that up early this week. Fingers crossed that works out. She want to move in right away. 1 lady, 7 year old kid, very good references

My net rents are SUBSTANTIALLY higher w this new management company. hope that continues.. be interesting to compare last year to this year

exactly 2 years left on the 3 units.. payoff 3/2018

My 401k is matched 3% a year but deposited all at once. so interested to see what that deposit is for last year (I carry the expected match to the left). I should have that match in the next 2 weeks



Rental update and general life stuff

February 15th, 2016 at 07:34 am

Hi all

ALL rents in this month, have an application on that one vacant house (hope it turns out) and lots of showings set up. 2 of the 3 units coming up for renewals in 75 days (the point the system throws alerts) so either will turn them over or renew. I can expect to get $50 more if turned over but as I look at my list of larger things I want to do I want to spend less on general turnover. In either case, my turn over cost are MUCH less than last year.

I feel so much better controlling and reviewing the 'fix up work' between tenants. I get to know the homes more and feel in general less stressed.

I have a list of items I want to do this year (improvement type things) to the homes .. but really all improvements should last a number of years so once I get this final round done should be just repair/cosmetic

I do my big excel sheet today (on the rental costs from last year). it was supposed to be systemized and easy and it will be this year but from last year I have the old property manager who gave me no reports for the past however long and then just one long excel sheet at the end

Anyway. still on target to pay off these 3 units march, 2018. if I buy this 2 flat I will set that up to pay off by then too

Feeling better in general about my health/future ( I got sortof thrown for a loop with Dad getting sick so fast) but looking forward to doing other new things, jobs, volunteering and incorporating that into life now

Still have no concrete plan to get this main house mortgage down. I want it to be under $100k by 6/2018.. that is my only goal with no clear path

I DID hear loan rules changed and may be able to switch to a 15 year if that is the case and keep the same ppayment but just 1/2 the term which wil help quite a bit

We shall see

VERY GLAD I switched property managers. one of my better MORE IMPACTFUL decisions in a long time.

Investments are WAY DOWN but just putting in more each month. and have the 401k at 25% . that is the amount I need to do to get to $18k by July1 (current contract end date). It will be fun to see the big change in investment value when things go the other way but for right now with things going down it is sortof scary.

Got some interest in that house. We have a call today. So will see on that. I will share later.

I Do still want to upgrade neighborhoods but do not want to give the house away either but sometimes it is better to cut your losses.

rental updates and musing

January 20th, 2016 at 09:01 am

Hi all

I got renewed but for only 5 months!Crazy. I have a new boss though and they said that is all they thought they could do. I did check and the position is budgetted for the the year. My old boss is trying to get me a 1 year extension which they had told me they would do in the first place. Fingers crossed.

Anyway.. have not done tax info yet but i AM looking at this year NET rental income I get and big change w the new property management company. less costs.. less hassle etc.. and I have one unit not paying (eviction date 2/2 if not out by then). Hoping the upward and stabilizing trend continues

Anyway I am thinking though and the biggest (not worked on yet) barrier to financial freedom for me is my house. I owe $300k . can not get a lower loan (though my rate is ok) but I can not get ANY loan reallly or any good loan for apparently 6 more years (unless rules change which they may) which means if I sell/move I would have to go FHA or something else.

I am NOT thinking of selling but need to get that balance down! I pay $450 over a month but still not really making any huge leaps in paying it down.

House is still nice. still in a good area.. still hoping neighbors move though (on my one side) and I may extend my fence.. I am kicking myself for NOT doing it last year .. instead I used part of their 'rear garage' as wall sortof so I did not have to fence that length..

Stil trying to get to almost $500k savings (only at $200k now) by 6/2018. it will be a stretch unless the market bounces back up and I continue my super high savings rate.

where do you guys suggest I investigage long term care insurance?

new 2016 goals

December 30th, 2015 at 08:18 am

Hi all

New 2016 goals below and on the left. I have NO pending large repairs across the rentals. what a change. the first two years were ongoing repairs and fix ups.. no such pressure now.. of course still maintenance and I do WANT to do some long term things but they are not required..

Still setting personal goals.. looking forward to another busy wild and crazy with ups and downs year.

Need to reduce my stress, the amount of stuff I have going on and do more for ME

GOALS FOR End of Year 2016
1. Maintain emergency funds at correct levels
2. $310k total savings and investments
3. Increase rents across all units by a total of $600 month by year end
5. Fix up/raise rent or sell 411 house
6. Buy 2 more homes
7. Fully fund Roth/HSA accounts
8. Fully fund 401k account

I will try to fund the HSA and Roth by February then all the rest goes towards taxable savings.. I will try some of the methods folks are using on here to track #s etc. I do VERY little tracking of personal. adn want to do more.

If the 3 units were paid off and I was not accelerating payments on them so much (I pay over $5k for the mortgage right now) I am at about $7k net cash flow/month with a 5% vacancy rate and other escrows included (tax, repair, insurance etc).. I am still smoothing things out so NOT at that right now.. but these 2 months w the new property manager have been the best in terms of stress and money in a looonng time.. I will check my vacancy rate these past 2 years .. and then again this year and onward. I have the feeling I will have less vacancy adn faster tenant placement w these guys..

really excited to compare this years #s to last years and have some more baselines. I did have a handy dandy excel sheet for that (which I still do) but lack of management reports and accountings from the old manager for 6 months makes it more challenging..

Got 2 default judgements and striving to reach year end savings goals

December 17th, 2015 at 09:23 am

Hi all

We got default judgments on both tenants. which means we get immediate possession

1. first tenant has already paid over $1300 to get caught up and formed a plan to pay the rest by 1/8. We still retain the right to remove her at any time up until paid in full. Mgmt company is adding legal fees to her bills too. MUCH lower legal fees w this company
2. 2nd tenant says she is moving by the end of the month. We will wait to engage the sheriff until then

struggling to put as much into savings to reach some goals by year end..

Goal (not on left yet)

200k 12/2015
300k by 12/2016
400k 12/2017
475 6/2018

Great meeting with Property Manager

December 10th, 2015 at 07:25 pm

HI all

had a great meeting w my property manager

Felt more confident, reassured, got more access to their system and my data. They showed me how to access 'notes', 'event history'.. everything.I can log in and see if rent is paid and if not I can see the notes of what they are doing about it. Still having to toss 2 people.. upsetting .... court date ALREADY set up though for the 15th on 1 and still setting court date on the other. I want good LONG term tenants and good properties

house across from my Victorian is SMALLER and listing for more than I wanted to sell mine for. wow. Hope mine sells well next year.

ALso having some new thinking about section 8.. these people really have a system for handling section 8 and it might be worthwhile. they know how to handle the tenants and I can tell the tenants already respect them

I have MUCH LESS stress from the homes

I stil think I am 2-3 months out from smoothing the homes out (getting these folks out, new folks in) they sent out new leases yesterday so the tenants are on their leases.

Repairs so far (have not been many) have been reasonably priced and well done.

We have a small backlog of minor repairs to do from the prior manager but feeling very good and like things are being HANDLED

also makes me think I can buy more.I am still short of my $8000 net a month goal (even if the 3 units were paid off) there is an investor who wants to sell this house that is in real great shape for $62k.. and it would rent for $1250.. looking at it

Work is ok. feelign on track but feeling sortof bored too. want a new challenge

I am working out and doing more things but still troubled by this personal relationship.


I am REALLY feeling like I CAN DO THIS.. and meet my goal of $400k by 2018, $8k net cash flow and be on my way to relaxing more and freedom.. Wow..

Accelerating payments on the 3 units makes things tighter but I wanted to force myself to do it

Rental updates, feeling like my 2018 goal is in reach

December 8th, 2015 at 07:48 am

HI all

Been swamped and struggling with what to do with a personal relationship... have not figured it out yet.

Anyway. back to finances

new property manager still going well. some bumps in terms of communication but overall much better. We have a face to face meeting today to check progress after month 1 and I will talk about communication etc expectations. I feel confident we can smooth it out.

Meanwhile they are MUCH tougher with rent and faster to serve 5 day notices and get people on track which I like.

STILL smoothing out which is upsetting but necessary and hopefully this will be the last time.. We are doing 5 day notices on 2 tenants.. both the old property manager put in.. both fairly new. one is that tenant he put in after 4 months of searching or 'not searching'.. whatever. Anyway I feel good these people will put BETTER tenants in faster.. Hopefully that is the case and I really feel it is.. very happy w new 3 unit tenant

The Victorian I was going/am going to sell next year/this year.. I just got a good comparable on it. the house across the street just listed (not sold) for MORE than I was going to list mine at and mine is larger etc.. so hopefully I can get the price I want for mine but really I do not have a lot in the property so just want to move on.

Section 8 inspection over there went well. much smoother.. lower cost.. LOWER stress.. we have another one this month on this other house

We are also going to have to turnover 1 unit in the (2) 3 units. and will look to do so for the $50 upcharge we did last time.

They moved in someone within 3 DAYS (of old tenant move out) to fill that first 3 unit vacancy!!.. so almost no downtime. minimal cost to fix up. just great

Hoping that repeats itself.

I have now determined I can NOT refinance out of this loan for some time (my main house loan). so committed to sticking around at least for a few years.. house is a nice ranch.. large lot. updated.. great area. I have my big fence up so private.. sortof like a 'compound' and house has all I need..

I AM paying $450 more a month on that mortgage.. .. started this month

Goal is to get under $130k by 6/18

I also talked to the 3 unit seller (I have a seller held mortgage) and re amortized the loan to pay it off by March/April 2018. With the payment being due on the 15th and the automated system w the new property manager only sending checks the 14th and 28th. this requires me to keep $4k in the account as overage. I am doing that this month. After that. I should be able to pull cash from the account each month and still save on the side. Overall savings goal is $5800 a month towards my investments funds or to fund ROTH IRA and HSA. I will also contribute to the 401k

I AM getting renewed at work which is HUGE (but paperwork is not in yet so not counting chickens until hatched/signed)

So counting my blessings.. still struggling getting these homes/units under control but feel I am coming out on top and feel good I am with a company (property manager) that is professional, cares about the upkeep, is finding good tenants and cares.. ie wants to do well and HAS SYSTEMS in place to do so.. I can tell tenants already respect them more.

I feel my goal of $8k a month NET passive cash flow is in reach. I am still challenged by the $400k by 6/18 but definately in reach too and still need ideas to get the mortgage (main house) under $130k by 6/18

I feel am going to reach my goals.. maybe I can even go full time sooner. I am liking my job. I work at home. and do well. full time will pay $105-110k and comes w 3-4 weeks vacation. why not? or take something else. I want to travel, do stuff.. live while I am young.

I am excited to do 'year end math' and see how I did in all areas.. I know I was way over with vacancy and repairs for the homes but tracking (and new management and learning) is the first step to improvement. I have approximately $400 to go up in rents still that did not happen this year.. (below market rents not just renewals) so if these people move out and at least 2 of them are next year.. I can raise those. this will also mean rehabbing the last 2 homes (if I do not sell one first) . It feels good to have the homes up to a baseline (the ones I did do) and just in general things more under control. By the way. I am now looking for LONG TERM tenants and to keep good tenants. this year poorly handled turnover, legal costs etc, rehab due to new tnenants was my largest expense! Here is hoping that takes a dramatic turn for next year w the new management.


Real estate tax dispute update

October 21st, 2015 at 09:05 am

HI all

got some preliminary tax dispute results. I disputed taxes across all my rentals. 6 homes and 2 3-units. i currently pay approx $18,500 a year in taxes. I have no experience in this but was hoping for a $3600 decrease. Got an email from the attorney (she only gave me the NEW assessed value) but appears based on the new assessed value I got a savings of approx $1250 across all (she sent a letter with full details and the translation from assessed value to amount saved). Anyway she gets 1/3 of the first year savings so if my calculations are right (had to get current assessed value and tax rate of the city website) then I owe her approx $400.

My personal residence is up next month (court) so hoping for a big decrease on that.I currently pay almost $10k

I think it was worth it. but looking forward to actual numnbers she calculated in case mine were incorrect.

This tax decrease on the rentals raises my profits approximately $100 a month for this year and on.


6 homes and refinance updates

October 14th, 2015 at 09:34 am

HI all

Few updates

Found someone else to do the refinance with. the file is w the underwriter. fingers crossed. I can get either the same rate 3.25 with OUT many closing costs cover or a slightly lower rate. I SO MUCH want to be out of the refinance.. having to get a new loan every year business!!

Settling w my old property manager. his paperwork and reporting is not very good. even he was not able to justify numbers..he came to our meeting with a stack of papers and we both used calculators for 2 hours.. but we are working it out. VERY high expense numbers again this month ..but that should smooth down

November 1 starts the new property manager. Hoping and thinking that works out but scary leaving and having a change in that area..

about it for now

DID look at homes in high B areas and still lots of REO or foreclosures (some in good shape) so I CAN swap out my homes in C areas for high B areas with less differntial than I had hoped. and may be better long term..

My birthday is TOMORROW!! 45..

Rental updates, Dad, not for profit

October 1st, 2015 at 03:19 pm

HI all

rental updates. All units filled. (thankfully)

Existing project manager has taken price gouging it appears to a new level after my giving notice. I had to speak to an attorney and really just out of control. I finally got him to stop (I think) just removing whetever he wants from the rents. We are supposed to meet this week on over $2000 (OVER TWO THOUSAND DOLARRS) of unauthorized, unapproved, repairs that I had no knowledge of. Attorney says to just settle, not worth it to sue and hard to prevent him taking the money on such short notice without disrupting rents. Crazy.

Anyway. swapping homes on hold. too much going on. person who runs my not for profit has been in the hospital this week and may need an angioplasty! and be out for a a few weeks. REAL bad news. not set up to run this in her absence very well

Dad doing well but steady decline. now it is hard to hold his fork so he eats sandwiches, he thinks he works still and gets $9000 a month. We normally go along w him and do not contradict just 'redirect'. however this time (as he asked me to go over his finances) it was awkward and sortof accusatory as the $9000/month was not in his accounts. Stressful. Facility says to keep conversations short on finances, do not bring it up, if he asks reassure funds are safe etc etc.. and redirect. They said accusations, suspicions are common. Uncomfortable.

Anyway. I am grateful I am able to contribute $2k a month to the 3 unit fund (payoff w $69k in June 2018 and I already have $4k saved) and save even more after that. Still paying back various funds for the 6 homes but feeling better

REALLY praying the new property manager is better and he should be. main issue is renting these harder to rent ones (which we just did and this new manager is definately going to be better at I think) and stopping unnecessary or made up or just 'unknown' costly repairs all the time. New PM notifies me w costs of ALL repairs up front and takes photos as his NORM. He also logs all tenant calls

New tenants both look good . both have family and friends in the area and both want to stay a long time

Hopefully that is the case.

Existing manager still has not renewed those leases. What is he doing.

Just his quality of service has gone way down

I only have 2 section 8 homes now.. vs 6 originally. this should cut some of my repair costs too as I was having to have yearly inspections on all before

Exciting news on real estate tax dispute and other news

September 24th, 2015 at 02:51 pm

HI all

First hearings for my rentals start Oct 22. I have seen the comps and we have some good comps that really might slash my tax bills on these considerably PLUS.. where I live.. Naperville. the dispute period opens next month but in just perusing the assessor website myself I found a house 2 homes down with 700 MORE square feet w an assessed value more than $50k LESS than mine. Hoping to get major tax decreases through this appeals process. Dropping $50k off my assessed value has a $3500 impact.. and that is still 700 square feet more room than I have.

in other news..last unit filled w the rentals AND got 1 renewal at the 3 unit, pending 1 more and pending the new renewal lease on that one house

the existing property manager and I are under tense relations as more and more stuff, inattention, errors come out. double billing, missing credits for rent payments, charging me $2500 last month for 'repairs' I was not aware of and am disputing.. and he is struggling to substantiate and now trying to settle w me for a lower amount. may have to get an attorney involved... also these renewals should occur BEFORE the lease term ends. just on and on . anyway.. one more month w him and then hopefully improves and really one of the key areas was repairs (not knowing about them, price gouging, inability to trust the repair was actually done not just made up etc etc). New property manager gets my approval BEFORE starting work and gets an estimate up front and takes PICTURES! and I can talk to the repair people if I want

again I looked through my notes. this did NOT occur w this properrty manager upfront. just got progressively worse..

Both tenants we moved in want to stay a long time and have friends/ family in area by the way.. hard to get cheaper fixeed up homes then the ones I have so may hang on to these.

So have a lot of people wanting to stay in these 'hard to rent homes' and have only 1 house that may makes sense to sell right now and investigating doing so. apparently per realtor and new property manager though, there are people starting to buy up to live in this area so area may be going up.

Totals are in. I raised rents $306/per month this year but vacancy (evicting 2 from the 3 units, and 2 slow to rent homes ) has me way over my vacancy budget and all these unexplained repairs and what feels like price gouging has me over my repair budget. The rehab I managed myself was over $2k less to do MOMRE work than through the property manager and I hired actual tradespeople not folks off the street

updates, opened an HSA and new strategy w rentals

September 21st, 2015 at 06:44 am

Hi all

I opened an HSA with Health Savings Administrators or healthsavings.com. Flat rate of $45 a year. There was one other one that might have been less cost dependent on how you invest, how much you had in there etc. this was $45 flat and had good Vanguard funds so felt like the easier choice.

Plan is to use this sortof like a 401k and NOT withdraw from it (unless some dire medical emergency) until retirement. This is one I set up individually not through where I work so money put is in AFTER tax but should; be tax deductible. Limit is $3350 this year. Will try to fund this , the 401k and the Roth every year. Trying! I put $50 in it to start the account.

Trying to be financially free in 5 years is exhausting stressful work!.. less than 3 years left.

that rental house is filled. the other house is almost filled. still confirming things (manager is slow)..

New strategy w rentals. I am going to get some outside opinions , use the web and get selling price estimates across the 6 homes so I have a good market value and look to 'swap' some out that and increase the quality of the neighborhood and therefor maybe lower my costs, not be so stressed with management etc etc.. . Step 1.. get market values this week ( I will get the 3 units value even though I can not sell that right now and really do not want too. rents easily, good area, great cash flow but realistically long term mayeb I would want small homes vs apts.. we will see... be interesting to see what folks think it will bring). 2. decide which to sell.. 3. I was going to take a stab at selling at least one via investor contacts and Craigs list (yes, really) have had friends sell them like that. why not me? 3. get a pulse of the market and homes and prices to see what I can buy w the cash 4. run my thoughts by some advisors for thoughts about selling at all, sell now or later. 5. get the new managers thoughts on ease of renting these homes. really we have only had issues with one home..

I may lose some cash flow upfront if I do this.. but steady returns and simpler may be preferred and cash flow will come as it is easier to raise rents on a more highly desirable area.

I can not be 'financially free' when I am stressed w the rentals anyway..

I did go for lower quality areas to 'get in' and do not regret it .. easier to get in.. much more cash flow...now I have somethign to swap... but is that where I want to stay??.. I am not thinking so. I have options now to 'swap' out of them and I think I may take that opportunity.

Anyway. just thoughts right now. got to get some facts, do some research and think on it. no more fast decisions over here!


updates and HSA question

September 15th, 2015 at 04:00 pm

hi there.

Updates. I think we have that 'harder to rent' house filled with a tenant I like. Manager is setting up a lease appointment. She has family in the area and wants to stay long. Fingers crossed.

House we rehabbed. we have someone lined up for that as well but she wants to move in on the 1st. We will do final checks and then sign the lease w her.

New manager starts 11/2. Excited.

Renewals notices are out for that one house..and one apartment. should have news this week

I am thinking of doing an HSA as another tax savings retirement vehicle. Any thoughts of where to put that. Healthsavings.com looks very good and has a $45 flat fee each year. $3350 per year limit

Still trying to max out the 401k. got $3200 left to fund.

Thoughts welcomed.


ON the 2nd round w the refinance underwriter.. got another 'condition letter' w items I have to fulfill. Will work on that tomorrow and hopefully close it next week.

I will NOT fully pay myself back this month. I had hoped too but looking like I may end up short.

Project Manager update

September 11th, 2015 at 02:08 pm

HI all

thanks for the feedback on the property manager issue. here is where we ended up

1. Current PM will terminate 11/2/15. Rents for November will go to new PM. I need to send the new PM an updated contract to sign. he did sign the one calling for him to take over as of 10/1
2. Current PM will keep the vacant homes until that time. The one I am rehabbing is done and BEAUTIFUL. he has showings tomorrow and one person we took an app from who wants to move in who has family in the area and is likely long term, Other vacant house, he has showings tomorrow and had a good one yesterday. Fingers crossed. we went over what he is doing and the only thing I can add is to put it on the list at Section 8 whch he should have done already.

Meanwhile we have 1 house and 1 unit coming up for renewal. Both look good but he did not send renewals out yet (hello??) but claims to have talked to the house and they want to stay another year. He has not called the unit yet but send out the notice today. He will have updates next week.

All rents in except vacant homes

Paying off the 6 homes makes a MAJOR difference in the cash flow across the homes and my own budget. I had a mortgage of approx $5500..

I am still however catching up after paying my part of paying off the 6 homes so super tight this month making my savings goals.

Work hours are slightly down w the holiday and took a day off here and there. I should average 48-50 again as of next week

I have had contact with the office of the new property manager and they are very professional etc.. organzied really excited. AND they are 2% less.. over $2k a year difference and will work w my contractor.

For this 'hard to rent ' home. the new property manager did not feel it should take 3 months and talked to some folks who felt the same way 'unsure why it is taking so long'... Regardless, IF this house IS this hard to rent, I will look into selling it and others on that street and buying easier to rent homes/units with the money.

Calm and continual cash flow is my goal

I will hear on my tax dispute in November across the rentals. Hoping for a $625 decrease each month in taxes but have no experience or facts to base that estimate off of

Still trying to reach $8000 stable monthly cash flow by 6/18

Did second submittal for refinance on main house. should hear next week. (had to submit a bunch more docs)


Property Manager issue-seeking thoughts

September 9th, 2015 at 06:47 am

Hi all

My property manager contract calls for a 60 day cancellation notice. I talked to the current PM yesterday and he was saying he will hold me to that and in general not very nice. He also has the house he has had vacant for 3 months. He says 'no one is going to rent is faster'. The seller (65+ year old owner rented it before on his own). We are hitting the slow renter season and I do not want that particular hosue waiting 60 days to turn over when I know this other guy can rent it faster.. and/or to a better client

The current PM says he has 5 showings set this week. betweeen Thursday and Saturday. I told him we will talk later in the week so I could figure something out and get ideas from folks. I feel like changing the locks or doing something 'forcible' but then he has all the other homes.

Any suggestions?

he makes nothing on the house right now and is likely just being an *****.I can not afford to have bad property management causing me months of rent. but can not afford to have him mess up the rest of the homes too.

<< Newer EntriesOlder Entries >>