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

March 7th, 2016 at 05:07 pm

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!!!

Rachael

Updates, rental and 401k

February 29th, 2016 at 04:26 pm

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

Onward!

Rachael

Rental update and general life stuff

February 15th, 2016 at 03:34 pm

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 05:01 pm

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 04:18 pm

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 05:23 pm

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 11th, 2015 at 03:25 am

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.

Onward

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 03:48 pm

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.

Onward!!

Real estate tax dispute update

October 21st, 2015 at 04:05 pm

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.

Rachael

6 homes and refinance updates

October 14th, 2015 at 04:34 pm

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 10:19 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 09:51 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 01:44 pm

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!

Onward.

updates and HSA question

September 15th, 2015 at 11:00 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.

Onward.

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 09:08 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)

onward

Property Manager issue-seeking thoughts

September 9th, 2015 at 01:47 pm

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.

Diarying.. property manager switch and LOTS of stuff

September 8th, 2015 at 02:36 pm

HI all

Diarying. been feeling a little 'unfocused lately'.

In a relationship and wondering if we are compatible or going anywhere.He does not express himself as wel as I would like w words.

ANYWAY..

1. 6 homes bought! took more money than I had thought and had to rehab that one house. already paid back my emergency fund.. got to put $3500 back in the personal emergency fund
2. now that I OWN these I feel a little more serious and long term. Anyway. I gave notice to my old property manager .. he still has that 1 house sitting and 1 house I had to manage the rehab (which was not so bad as i learned and got it done how I wanted and for 2k less )but he did not assist with meeting people, reviewing the work etc. . Anyway I gave him 30 days notice. He says the contract calls for 60 days. I called him this morning and his VM was full (not an unusual occurrence).I am going to ask he release the homes in 30 days and that 1 vacant home immediately. I will update.
3. Put my first $1750 into the 3 units payoff fund. Looking to pay those off 6/2018 and need $69k

Basically switching property managers as the one I have (though better than the one I switched from who ran the 3 units)
1. he is overwhelmed and is a 1 man show, he has 2-3 times voiced concerns he may 'quit this' if things do not improve. VM Full often and several times got complaints from tenants he did not call them back. Not organized. reports late or not submitted at all. Still waiting for July, August reports and laundry $ from 2 months ago. Does not renew leases on time.. Having to remind him of things all the time
2. Does not have a good relationship w section 8
3. Slow to rent . Slow to rehab. It should be noted this was NOT how it was when I started w this guy. Maybe he is more overwhelmed??
4. I do not trust his repair people and he will specifically not let me speak w them.

In contrast the new guy has an online software system that allows me access to see rents as they come in, run reports, has leases etfc uploaded and has all communications w tenants noted, has an office with staff and have 9-10 people on staff. They personally take emergency calls 24-7. All calls are logged. I met the repair people and I am free to talk to themm on repairs if I want AND they talk to me upfront about all repairs with a PRICE for my approval. Plus I can use my own contractors which they will manage. Monies go out automaticaly on certain dates, late notices go out on certain dates, they have a very good relationship w section 8,. they enforce the leases and have a guarantee . if they have to evict they will refund my 'placement fee' and they are 2% less per month..

Also with the current property manager, repairs costs were high and it appeared he was 'fixiing something' every month. I recall it being 'curious' that when I did hte switch the last time the need for repairs stopped and how mmuch can need fixing in a house. these are small 1000 square feet homes? It made me feel repairs were 'made up' and added to the bill .

Again this was not how it started w that guy.

So concerns w the first guy were
1. ability to rent
2. communication
3. repairs
4. reports

It appears I wil have improvement in all of those. I need these homes STABLE.

Started an eating and working out plan . want to lose 20# in these next 8-10 weeks. gained weight getting my primary residence back from the bank and then again recently.

and looking to find ways to be more relaxed, less stressed and have more thing I enjoy

Really if I can hang on this job (or a similar job) an get these properties under control I just need to follow my monthly goals and I will reach my June 2018 main goals.

Primary home refinance still in progress. LOTS more docs this year.

And got reassigned at work to the largest account they have.. with a project that will go past 1/16/16 so feeling like if I lead this project is pretty much guarantees my renewal for another year or at least 6 months. I will ask for that in November

real estate updates, goal change, CLOSED ON THE 6 HOMES!!

August 24th, 2015 at 04:47 pm

HI all

Worked 141 hours these past 2 weeks. Crazy.. good money but not what I want long term. I may get a Nordic Track ifit treadmill w some of the money. that or they have one of those training bikes w ifit with incline and decline.. both are approx $1500

I feel I am getting out of shape!

Anyway.. CLOSED on 6 homes. had to borrow from my emergency fund approx $2000.. will pay that off next month

I TOTALLY own these 6 homes now. no mortgage

IF homes run well I should be able to pull $3500 from the homes and will not have put in $1000 a month anymore towards covering the monhtly payment. so total NET increase to me per month $4500 ($1000 saving and $3500 new income).. basically ALL will be saved and invested to reach my 6/2018 goal

2 homes vacant. One we have an excellent long term tenant for and are fixing up. this is the home the 15 year tenant moved out of.

One has been vacant for almost 3 months.. 4 weeks I got rent for.. and the rest is a total loss.

Met with other property manager.. looks real good.. will post for input here and have asked some other folks

Thinking of for sure switching over the vacant house to him immediately w the rest to follow..

Made a mistake switching last time so want to be real sure but how can I lose? this guy is letting this house sit and has not sense of urgency.. other stuff too. will update later.

Current property manager does not appear to have time to show the house timely, and marketing is not getting what we need. I asked several folks what they thought of the vacant house. and they looked at it and were surprised our starting rent was so low and that it had not rented... even providing comps they owned near by with renters.

I contracted w a real estate attorney to appeal the real estate tax assessments across all my homes (my personal one too) .. cost 33% contingency of the 1 year reduction amount.

I currently pay $20k across 6 homes and 3 units and $10k for my own home. I am hoping for a $3k or more decrease. Never did this so do not know. What I think is good is that we just recorded SUPER low sales prices across the 6 homes w the title transfer..

Anyway. IF 3 units were also paid off I would make $6200 NET a month (this includes escrows for tax, maintenance, vacancy etc) . so I am $1800 off my goal of $8000 NET by 6/2018. Will continue to work on that.

I am CHANGING my June 2018 goal from 'having my own home and having it paid off' to 'having my own home and only owing $100k on it'. I do not feel I want to use my money to payoff the home totally right now.. $100k or less owed is fine..

Still waiting to hear on primary home refinance.

Onward. and looking forward to when hours lower (45-50 is fine but 70+) is 'soul sapping' so I can concentrate on Me, health , happiness and MORe to life than finance and work!

Also saw Dad yesterday. though he is happier at Silverado and cared for better. he is weaker and really not sure how much time we have. I am spending as much time as I can w him. This weekend I showed him the yard and he could not make it around the house (walking) on his own.

6 homes updates-tough month!!

August 8th, 2015 at 12:07 am

HI all

6 homes updates.. feeling stressed and trying to just get through it all.. Whatever God gives you to lift he gives you the grace to carry'

I STILL Do not feel I have the 6 homes under control

1. 1 house has been vacant for 8 weeks (but only missing rent for 4 weeks of that so far). Took 3-4 weeks to fix it up (too long. will remedy that next time), then spent 2 weeks at too high of rent and now 2 weeks at the realistic rent. .getting showings and good feedback but not rented yet. Upsetting and stressful. had long talk w property manager on it today
2. the section 8 house, forgetting if I mentioned it we were thinking we wwere going to pull it out of section 8 and then instead did all sorts of roof, water drainage work on it and left it in section 8 because the lady has lived there for so long and wanted to stay... well she UP AND LEFT. I found out from Section 8? not her. not the manager! He is going over there tonight to look at it but with her being in there for 13 years likely needs a full paint job and updating. ARGGH!! Manager says he talked to section 8 Tuesday to get it reinspected and no one said she moved out and she did not either. He talked to her Monday. Crazy

I have been having MORE AND MORE insane crazy totally unprofessional costly things happening w the section 8 folks .. Property manager says folks are getting out of section 8 and did not think it was bad to lose this house out of section 8 as rent was low (13 years in there) and the annual inspections and nonsense like this. craziness

Bottom line though is I am going into the month with TWO VACANCIES (1) already at 8 weeks and (1) likely to go at least 4 weeks as we have to do a rehab on it..

I am not prepared to spend more $ to rehab another home and am going to need to beat some bushes to find the money. or something. I am feeling severely money crunched. SEVERELY. with the landscaping (paid for) and the fence (money sitting waiting for completion)..I have been scratching around for money and cutting all costs already. hard to find or cut momre.

I speak with another local Property Manager Tuesday
and will speak to a local investor this weekend to for ideas to rent these faster... cut costs..

Positive things

1. all the rest of the rent is in
2. the house that we did rehab looks good and rehab is paid for in full
3. I am working 65+ hours a week at work so getting extra money
4. still hoping to hear positive news on the gift to partially payoff the 6 homes
5. this too shall pass (hopefully onto better tiimes!)
6. fixing up this house will mark the 4th house rehabbed.. only 2 more to go after this and one of those looks pretty good
7. even though it is hard to fund these rehabs., if done right these are long term investments into the homes.

Onward.

Being proactive (a little late but still good)

May 28th, 2015 at 08:43 pm

HI all

I never had the 6 homes I have properly inspected before purchase and long timers on my blog know that that was a mistake. I do not like the uncertainty and not being in the know so I am going to get them inspected now. I got a few referrals so calling and getting someone good to walk through then inside and out and point out any major issues. Not sure of cost yet but I feel it will be worth it.

These are long term cash flow properties so need them SOLID.

Property manager and I are thinking of pulling another home out of section 8.

I may be coming into a $10k bonus so if so will devote that into making these homes 'solid'... some may be fine already.

Still saving as much as I can and having less stress w the homes but having an inspector guy to review the homes will be helpful

also attend the landlord meetings next week

Just musings on my 5 year plan-thoughts welcomed

May 23rd, 2015 at 02:21 pm

HI all

Just musing here.

Dad has made me realize or struck home that life is REALLY short. Seeing him confused is VERY SCARY and makes me want to make the best use of my time and to watch my health what I eat, drink etc.

I do not want to waste time with things I do not want anymore or 'settle'. So re thinking some things in my life.

Anyway

rental updates.

The drama w the homes and 3 units is leaving me which is nice. No dramatic updates. Moved in those 2 folks. Got 4 renewals on the 3 units.. 2 more for the Fall at the much higher rent and we are not concerned. NO MAJOR work needed immediately. I could re-side the place but no need too. I just did a major tree trimming.

City inspection is quoted and funded.

Laundry money is UP

6 homes
1. short term lady moving out next Thursday. We start showing Monday and have 6 possibles lined up to see it. Hoping it rents soon.
2. Property manager is now a preferred vendor with that local insurance company with people in need of short term housing due to fires etc. He just filled one of his other homes at a $500 premium. Mine was not available yet but bodes well for the future that we may be able to do that again
3. other long term lady SHOULD be moving out end of this month. hopefully she is but my guess is maybe not. that house needs the rehab (not quoted)
4. everyone else is fine. I have section 8 inspections on the 4 homes every year and they are not fun. Inspectors appear to want to find something every time. I may look to remove other homes from the program. Others are doing so and Section 8 housing is hard to find. I am tracking how much they cost each year
5. repairs in general are down across the homes .. like break/fix repairs which means the proactive approach has worked
6. got to do some landscape work on 1 home but really feeling fairly in control

I am now forecasting that even with all the repairs I will end the year with $15k in that account and am holding onto $8k to fund forecasted repairs outside of the $15k

Job is fine..working 50-55 hours. LOTS of money but tiring

I need and now have a goal to find HOBBIES, interests, friends outside of real estate and my not for profit

I am in general unsatisfied w my life and want to be happy. No reason to wait to do that until the homes are paid off. I am seeing someone and am in general not satisfied w that too or just stressed or both. I will make some decisions on that in the next few months.

I am trying to get my arms around Dad's finances. He has much more than I had thought and all (ALL) of it is in cash accounts. I want to speak to someone to hep me consolidate and put that into safe interest bearing accounts.He will have about $1MM total cash after the house. any thoughts for advisers or what to do w the money? Plan was to keep a year worth of costs out of the market and invest the rest??

Also house should sell and close in these next 3-4 weeks..

he is not doing super awesome. VERY confused. Very bad. Last week he got into his car and got lost for 4 hours and was found by a good samaritan and driven back. We took away the car and he has an eval next week to see what stage of dementia/alzhemiers he is in. He is NOt happy at the assisted living place and I am not sure how to act. Is he not happy because he thinks he is on an airforce base being forced to re-enlist or am I holding him against his will in a place he does not want to be at? Do I act for his safety or his happiness and he is so confused not sure what to do

He says 'he hates himself, hates his life, wonders if I hate him and he wants to kill himself'

very bad.

2nd renewal

May 15th, 2015 at 09:53 pm

Hi there

We got the 2nd renewal at the 3 units. so so far 4 units turned over to $600 (out of 6).. 2 left to go . There leases are up September and November.. 3 units are STABILIZING.. yay

and got folks waiting to see the house that is vacating by that short term insurance lady. We charged the insurance company $1435 but market is more like $1200 so getting a rent decrease there on a 1 year lease.

Lookimg for investment thoughts and have rental updates

May 15th, 2015 at 08:35 pm

Hi all

Still putting a good amount of money in savings..$20k so far for the year not including the 401k

Expecting $14000 of fix up costs this year on the homes/3 units. Got $8000 towards that with only $6k left to find/earn/make up. This math will keep me at $15k emergency fund by end of year which is my goal

I was thinking of taking out the $15k rental fund from my networth calculation. what do you guys think?I really will not use it for anything but real estate . and need it that high for the first few years to fix these up. weather changes..maybe just in general ALWAYS keeping $15k

Two houses move outs at the end of the month. Already showing one... and have fix up work on the other so will have to fix up/rehab first and then show (more downtime)

So far. got 3 units turned over or re-leased at the 3 units (6 total units).. All at $600 ..all look good. I also raised the security to $900. NO current vacancies. Waiting for this one guy to get out or re--sign his lease at $600 for June 1 and then got 2 more who renew in a few months. So after these homes and this guy and this fix up work. things should quiet down.

Overall happy w the rental property manager change but want to fine tune it. These homes are long term. need to hone my process and relationships to lower stress and tighten things up.

Dad gave me his guns. selling for $2000 approx (on consignment) that will go towards the rental fix up.

INVESTMENTS. how do you guys allocate? I have been reading up on this and thinking about doing an investment policy statement with my long term goals and strategy. . currently thinking.

10 % bond
15 % international
75% aggressive stock fund

All at Vanguard.

What are your thoughts. Thanks

Still plan to refinance the house in August to a 15 year loan with closer to a 3% rate. currently at 5.35. This will not change my payment significantly. possibly raise it probably $300 a month.


Feeling frazzled but diarying the journey

May 1st, 2015 at 03:06 pm

HI all

Just diarying the journey today and should do that more often.

Updates..
1. work still fine, working 50 hours a week, making more than I ever did, raised 401k to 19% from me (and get a 3% match credited at the end of the year)-SPEECH CAME BACK!! yay.
2. doing a roof and turning over a house this month (roof is $3500. house is getting quoted)..
3. 2 tenants moving out end of May... one is long term and house requires updating. one house we should be able to clean and turn over quickly
4. 3 unit "turning over bad tenants/raising rents effort" is progressing but definitely more stressful than I had thought but still on track., We DID go down in rents from our projected $630 across all units to $600 across all units. Still hoping to have the bulk of this smoothed out at the end of May
5. projecting $17,600 worth of long term improvements this year between my house and the homes and 3 units. I will have to take $7600 out of the rental emergency fund to fund that and them replace that by end of year
6. still trying to save every month. $12k saved since the start of the year NOT including 401k
7. $28k increase in investments since start of year (with appreciation and new cash put in).. goal was $35k. Raising goal to $50k for the year
8. Dad is moving in to assisted lviing tomorrow .. 5 minutes from the house. big life change for him and me.. adding stress
9. lost wallet and 6 homes check last week (caused lots of stress.. ) almost had to replace the 6 homes check ($5100)but got it worked out.
10. still planning to refinance the house to a 15 year loan in August. I am currently on a 30 year loan paying almost 5.3.. rate should drop to 3.15 or something


2 years 9 months til 6 homes paid off but hoping for an easier year next year as we raise rents and take care of finalizing the bulk of the long term improvements this year.

Have not had ANY time to work on coming up with an extra $119k to pay off the homes at the end of this year but have 2 friends doing fix and flips. t hey are newbies but are estimating making $40-60k each.. being newbies maybe it will be much less but still interesting

We will see how it goes but I have friends who are NOT newbies, more experts, who do them and DO make that amount. I need access to cash (not my own) and TIME to THINK and RELAX (has been in super short supply lately)

Onward..Smile

A good acountant is worth their weight in gold! Tax refund and homes updates

April 22nd, 2015 at 06:41 pm

HI all

Been out for a while.. LOTS going on w Dad.. a little down. my speech (stutter) has taken a major turn for the worse.. and working on other stuff.

Anyway.. a good accountant is worth their weight in gold.

Worked with accountant (took some time) as this year was A LOT (lost the 2 flat, and refinanced my house twice after buying it in a hard money deal) and got a great refund coming.

Anyway.. refund $13,568. Crazy!

$4500 goes to the Roth IRA
$1000 wil go to regular investments (taxable)
Much (if not all) of the rest will fund this years 6 homes/3 units improvements.

We are working on tenants for both the 3 units places and will firm up tomorrow likely.. the 2nd person we were tossing moved on her own. Both have tentative move in dates of May 1 once signed.

Hopefully no vacancies there in a while! (but still have 2 more rents to raise)

Expecting the S8 lady to move out end of May .. along w the short term lease lady. so will have to fill 2 homes this year. Section 8 people generally stay a long time so when this one moves (7 year tenant) we have some updating to do and then hopefully can get another long term tenant. We took the short term lease lady because her lease bridged the gap between a bad time of year (winter) to early spring setting us up to re-rent it well to a longer term person. Also she paid like $300 more a month.

this is a BIG year for turnover though! Costly

and all the same time of year.

Hopefully next year will be much less.

Rent increases and other good news

April 2nd, 2015 at 04:48 pm

HI all

My rent increase with section 8 went through and all it took was an email, call and filing out a form. WOW. got almost a $200 increase on a long term tenant.

Getting lots of good showings on our vacant apartment and other person we are tossing did not qualify for enough disability so expecting her to leave shortly.. Both will go up to $650 so so far on the 3 units I will have raised the rents $205/month . and the 6 homes $186 a month since the start of the year. hoping for more .. I WILL likely take a cut when that short term lease lady moves out so can not count yearly totals til we are at the end of year. Goal was to raise rents $400 across the board across all units. I want to exceed that and stay within the maintenance budget. note: rehab and roof money does not come from my maintenance budget it comes from the rental long term/or emergency fund.. so that will need to be either built up now or replenished later so I end the year at $15k

In other news.

car paid off!
and another $350 towards investments today and managed to vacation for 6 days with no noticeable decrease ins savings.
and set up $50 Vanguard auto invest per month (difference in car insurance w dropping the Tahoe)

facing some big costs though

1. city inspection on the 3 units.. estimate a few thousand (new code rules regarding water heaters and furnaces across ALL units)
2. remainder of the city inspection on 2 homes. minor outdoor work
3. roof on one house
4. turn over one house that has a long term tenant. estimating at least 4k?

But as I turn over these long term tenants the homes are getting updated so the 'update/rehab the whole house' is not yearly expense. (thank the lord)

Onward!

Rachael

Update and musing about rentals

March 25th, 2015 at 04:25 pm

hi all

unit that was vacated looks fantastic. We will do a quick clean and re-rent. listing it for the weekend

I am going to a local landlord meeting April 14.. meet people and learn. I am looking forward

and finally seeing the 6 homes/3 units for what they were . a good deal but not a 'turnkey' situation more a deal where the sellers were sortof 'done' and rents were lower, management was 'ok' and the places needed some fix up.

I went into it thinking 'oh this will be relatively turn key'

Anyway glad I had the money to fix them up and hang in there through the turnovers (JUST starting on the 3 units this year) and the lack of rent.

I feel very good though that this was a good long term buy and feel I have 'turned the corner' and it is getting easier and easier and smoother and smoother.. and really when I am done I will be in a better position then had I not done the rentals and just 'saved' and actually even better then if I had kept the OLD rentals that I lost in foreclosure(those I paid too much for it. Only thing I wish was I had not used up my IRAs in the past..

that is the past. looking forward to the future

and just did the FIRE calculator thing and with a conservative estimate of savings $100k and my rentals paid off (4/2019 for ALL of them) I have no lines going to zero!

3 unit update-looking up

March 24th, 2015 at 08:17 pm

3 unit update. Looking up!

1. Guy we were throwing out is OUT! Property manager will assess the apartment tomorrow Am for repair/clean up but looked great last week. Will list for the weekend if looks good. Rent will be $650 and we are going to ask for $800-900 security. I will also have manager have Section 8 look at it. to see for the future what they would pay for it. He talked to Section 8 before and they were thinking $700 or so.
2. lady we went to court with today. Court went well. Basically 'we won" and got the judgeent. Move out date 4/14. It was set so far ahead because the tenant's income situation changed and she may be able to pay the back rent, attorneys fees and a higher rent and says she want too. We will see. If we do not work out something her date to get out is 4/14 and she WILL have increased income so hopefully can do that.
3. I also meet with the property manager tonght. We talk all the time but I meet w him once a quarter. I have a list go go through.

Feeling MUCH better w 6 homes/3 units this year. more proactive. less reactive. more in control

ALSO finally did my excel sheet summarizing up everything from the 6 homes/3 units for taxes for last year. Gave that to my accountant. I expect to have news on how much of a refund I will get either this week or end of next. Hoping for at least $10k

I also now have a process (MUCH better process) to track every month, track to goals and this process will allow me to just print it off at the end of the year and voilah! I am ready for taxes.

VERY happy I got rid of the other lady property manager

Put $500 to Vanguard. Rest of car money will towards the rental emergency fund and the Genesis payoff

Tahoe ad is up and more savings

March 20th, 2015 at 07:39 pm

Hi all

Tahoe ad is up on Craigs list Hoping for $22k for a 2008 Tahoe LTZ w 88k miles.

Fingers crossed.

Brother dropped off $300 this month for the privilege of using my address.. sent itright to vanguard. I should get this every month.

Talked to Section 8 on my rent increases. They are submitting 1 house that is now at $975 in for approval at $1111 a month. Hope it works. (very easy way to raise the rent on long term tenants if it does.. teannt portion does not go up) The other 2 are not eligible as the people in them have only 1 bedroom 'vouchers' but choose to stay in a much larger house so for then I need to move them on to raise the rent.

The short term insurance lady moves out at the end of April. she pays $1435. We are looking to re-rent at $1250 or so. She paid more because her lease was short term. I expect minimal fix up there as we just fixed it up and she has kept it up well. should rent fast.

Other lady (section 8) rent $950 is moving out around the same time. end of April . end of May. We will need to update that house and will expect $1100-12oo in rent when we do. I expect to lose a few weeks here fixing this up.

Things are still in the works on the 3 units. Hoping that one guy gets out over the weekend but if he does not all his stuff wil be set outside (extra $200) on the lawn Tuesday.

Court date for other lady 3/24 too

and 3rd 'slow payer'.. his lease is up 5/15 and we can not apparently serve him for just a late fee. Property manager is going to talk to him and see his intentions etc. His rent will go up to $630 if he stays..if he misses rent we will start fileing.. so his rent will go up 6/1 to $630. if he misses that we will serve him

I think people are seeing we have pretty good units in a nice neightborhood at a good price in town. Which bodes well. We did a random search and really again there are very few 1 bedrooms in town.

reviewing w my accountant I have already raised rents $460 (a month) across the 6 homes since I got them.

Onward.

Good news on the 3 units!

March 18th, 2015 at 05:59 pm

HI all
Brief good news on the 3 units

1. we got our first renewal!! Lots of people (including the old property manager said I was crazy and did not know how to run my business) but looks like it may just work. We got our toughest renewal. the one with the biggest rent change. $560 to $630 effective 4/1!!
2. guy we are tossing out is moving out THIS WEEK. apartment look immaculate. Goal is to rent it by the first. If he does not move by this week. sheriff comes the 24th. Most move before hand and he knows the date
3. Court for the other lady (who was on the failing payment plan) is 3/24..
4. other guy we do not like and who is always 'slow' w rent and late fees. his lease is up 5/15. We sent him a renewal. if he does not pay late fees immediately ($60) or renew we will toss him as well.

With THAT done we will have gotten rid of ALL the bad renters and can smooth things out. The other 2 folks are newer people and good renters. likely to accept the renewal when it comes up but if not we expect no trouble.

Goal was to raise the rents by $400 this year across ALL units. With these 4 points above (raising rent to $650 on NEW tenants and $630 on the renewals) . we will have raised rents by $280. This assumes the 'slow payer' renews at $630 and straightens up . if not we will put a new person in there at $650 making the total go up to $300 month increase. Of course this comes at a cost but we the cost was worth it (and unavoidable. these guys were not paying anyway) AND now w the new leases in my property managers name (not the old PM) he can file eviction suits on his own on any new or renewed tenants.

feeling good. still a lot of cost this year but feeling like things are getting more and more under control.


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