WatchI now have 3 homes under contract. [I think the market mostly will go down, however, the price/rent ratios on these are good enough that I don't care. My long term plan is to get six more with mortgages as investor owned, priced 65 - 100K, a couple more cash, and another home for me to live in MUCH later as I believe higher end prices will drop for a ,long time still]
home 1: zip 85015 26K. Needs 4-5K in work [paint, partial flooring, broken skylight, stove, microwave, washer, dryer, fridge] 3/2. 2 car garage. median crappy part of town, rent comps $800, I have a friend 2 wants it will give it to him at $750. I can have it ready to move in 1 week. taxes $600 a year, hoa $180, blanket insurance. I will hire out management of this if my friend ever moves out, as it is 25 miles away, thus I would eventually lose 10% of rent.
home 2. zip 85201 33K. Needs 3k in work. [partial flooring, paint, washer/dryer/fridge] closer to me, so-so part of town. 3/2 2 covered parking 2 miles to ASU and 2 miles to MCC, rent comps $775 HOA $170 Taxes $600 a year. 1 week to prep.
Home 3. 85281 42K needs quick cleaning, and washer/dryer/fridge] rental comps $850 actually upgraded inside, might beat comps or rent very fast. 3/2/ 2covered patio. 2 miles to ASU, short walk to lightrail and free shuttle bus throughout Tempe. HOA $150 a month, taxes $800 and dropping.
These all 3 are cash purchases, as they are condos, and hard to finance. They are 75-85 percent off peak prices. And have never in their lives sold this low. In fact, I looked at 2 of the complexes 15 years ago when I taught at ASU, and prices then were in the low 50's (height of the savings and loan housing crash out here)
These are the three that appear to be coming through. One is HUD, the other 2 are short sales that have now been approved at these terms, but of course nothign is certain until the close.
I only feel it is fair to disclose what I am actually buying, since I write my fairly negative view of most real estate markets on here with frequency and gusto.
Follow
Befriend (25)
413 threads
6,981 comments
Saint George, UT
elliemae's website
robertoaribas says
...i was country when country wasn't cool...
robertoaribas says
it could possibly be your approach.
Follow
Befriend
10 threads
213 comments
Pasadena, CA
robertoaribas says
You mean personal insults like this classic Roberto from http://patrick.net/forum/?p=579625#comment-705358 :
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
yean in response to "phoenix sucks I would never go there" which is fairly strong, I may have replied with unnecessary flair...
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
Ok, home #1 closed. 13 days ago. $42,000 for a 3/2 condo in tempe, on light rail and free bus shuttle to arizona state university.
After 8 days of intense work, it is now remodeled. Quick review of my credit card bill shows I spent about $3500 at home depot, though I also purchased several tools [nail gun, electric planer, lots of odds and ends I've lost or loaned out over the years], and bought contractor packs of many things, so lots left over for the next home. Plus $1600 for construction and painting help. Still need to get a refridgerator, washer and dryer, so maybe $1100 more. Call it an even $48K.
Home is rented, deposit cashed, for $825 a month.
12 hour days of remodeling work were MUCH harder than I remembered, I better do some Yoga or something!
Follow
Befriend
110 comments
robertoaribas says
I recommend my friend Liisa, who is a great yoga teacher in Mesa.
Follow
Befriend (13)
102 threads
3,764 comments
robertoaribas says
Arizona must be much nicer to landlords than California. Here we had a renter not paying for 8 month, and he was protected by the law... and we had to pay his utilities too while at it.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
hmmm, these purchases are now 1.5 years past... rented continuously, and none of them can be bought for even 50% more than the prices I posted on here...
All the naysayers about AZ have been very very wrong so far!
I just bought my 11th home yesterday, $80K, which only needs some cleanup, bedroom flooring replaced, and will rent for $1000 a month...
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
ok, it's been a while, so time for an update:
dec 28th I closed on my 14th home. 2500 ft^2, 3 car garge, pool, rv gate big lot and all time. It needed about $5k in repairs, which I've started. Leased now for $1500 a month, my mortgage is $705.
Yesterday, I got verbal approval from both lenders on a short sale i'd given up on months past. 4 bedroom home with 2 baths, dirty but not much wrong that a good cleaning won't fix, and it should rent for $1000 a month. Purchase price $86k, taxes $800 a year, insurance probably around $600. I don't know if I will have time to get a loan, or have to buy it cash. In today's market, cleaned up, this home would sell for sure for $120K in a week. I don't know why the first lender would approve this ,they would do much better letting it go to auction where they wouldn't owe the second a penny, nor pay any commissions, but hey, banks are brilliant market manipulators!
So, that will make 15 homes counting the one I live in, and unless the market does some huge crash again, I'm done at this point!
The home has a 2 car carport, but the house makes 2 walls, so I believe it would be fairly easy and not too expensive to convert to a 2 car garage. In phoenix, there is a way to do this, where a small space is left at the top of the one wall, so it counts a non attached wall and the code requirements are much less. If I can get it done for around $5000, I see it as a double win: homes with 2 car garages in that neighborhood seem to rent for about $75 to $100 more, so that alone is a hell of a return on $5000, but additionally, the value of homes with 2 car garages appears to be about $7000 to $10,000 more...
Follow
Befriend (3)
2 threads
236 comments
Mountain View, CA
Will a 2 car garage provide more ventilation for renters seeking to maximize their meth-processing capability? If I were a pharmaceutical entrepreneur, I sure as hell would be willing to pay $100 more per month in rent in order for some peace of mind!!
Follow
Befriend (3)
16 threads
1,378 comments
Victorville, CA
Premium
robertoaribas says
Whoah, bubba. That's probably a little too invested in desert rentals for my tastes, but hey...I don't know much about Phoenix. Median prices on SFH in Victorville is up 20% from last year. I'm thinking of unloading two or three of my units until things shit the bed again.
Follow
Befriend
16 threads
385 comments
Dang, buy me a few then too Roberto. 3br here has jumped from $100k up to $150k in the past few months with rents hovering around $1k/mo and taxes near $2k. IMHO not worth the headache at $150k, but if I could get your prices I'd be buying too.
Follow
Befriend (2)
8 threads
1,126 comments
Seattle, WA
David Losh's website
Premium
FortWayne says
This is why I always avoided being a land lord. My first rental I bought with a partner. He rented to a very nice Christian couple. We said no pets, no pets were a clause in the lease, but they got a German Shepard. I found out about the dogs when they reported a gas leak.
Oh, the German Shepard had puppies. They kept the puppies in the kitchen, and for some reason, I guess by moving the stove in, and out from the wall, the gas hose broke.
I went to talk with them, went in, saw the mess, and the gas leak, and was very excited.
They filed a restraining order against us, stopped paying rent, and yes we had to pay utilities. It took six months to get them out, and they had trashed the place.
After that I only bought what I could sell. I've had renters from time to time, but never really liked it.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
In arizona, you could have had them out in about 45 days...
Follow
Befriend (2)
8 threads
1,126 comments
Seattle, WA
David Losh's website
Premium
robertoaribas says
There is a thing about not paying rent if your property is unsafe, or doesn't provide utilities.
They sued us for not providing a working stove, and they had filed a gas leak report with the utilities. The gas company are the ones that turned the little lever on the supply line to the stove to shut the gas off.
In the hind sight of forty years, these people were pros. They had the attorney before they called us.
Follow
Befriend (3)
28 threads
747 comments
Tarzana, CA
robertoaribas says
robertoaribas says
robertoaribas says
Darn, maybe I should consider greener Real Estate pastures.
The cash investor house flipping here goes all the way out to Fontana !
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
those deals don't exist anymore, they are all at least 100% more expensive today.
Follow
Befriend (3)
28 threads
747 comments
Tarzana, CA
Ok, yesterday I saw some nice properties, a bit more expensive but reasonable, that I liked online in Miami, don't know the neighborhood though.
For whatever reasone, flipping is not going on in Dallas, would need to research Miami more.
Don't worry, Phoenix may be a little too red neck for me like Texas...
Follow
Befriend
16 threads
385 comments
David Losh says
Did your partner not speak to their previous landlords? I hear stories like this and always wonder if people don't do their due diligence. But, it takes me at least 3+ hours to screen a tenant. More if they have credit issues or something that isn't spot on. I check every scrap of information I can find in social media or other 'internet aggregator' tools like Spokeo, and NEVER trust the information they put down (particularly their current landlords contact info). Call the county to get the property owner's information and usually you can find their contact info online. I figure every hour I put into a screening saves me 10+ hours of headaches down the line.
Not trying to be arrogant, and someday I know I'll probably get burned.. Only had one 'surprise' so far. Girl had a solid application, but then moved in her boyfriend without permission. With a bit of carrot and a bit of stick, I had her out 20 days after she moved in.
Follow
Befriend (13)
102 threads
3,764 comments
Mark_LA says
They do this a lot in Vallarta. You see them use the EBT for groceries, and a second cash transaction for alcohol. All while working off the books elsewhere, and collecting from the state at the same time.
Follow
Befriend (13)
102 threads
3,764 comments
David Losh says
And that's a Christian couple, I shudder to think what some of the renters we have turned away would have done.
One time we had this lady of color come in who just fit a really ugly stereotype, entitled, rude, and she told us that she was really upset that her lawsuits against the county and previous landlord were taking too long so she could get the money to pay her rent. I really think we dodged a bullet there.
Anyhow, haven't been doing any landlord type of stuff ever since. It sure is not for everyone.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
FortWayne says
that post alone, if tracked back to you, could get you sued as a landlord ...
Follow
Befriend (2)
8 threads
1,126 comments
Seattle, WA
David Losh's website
Premium
gbenson says
This was 1984 and they had excellent references from other Christains. My partner was a very seasoned investor.
The attorney they had was a Christain just doing God's work.
He had a good job, and she stayed home. We did as much as we could to check these people out.
Follow
Befriend (13)
102 threads
3,764 comments
robertoaribas says
Yeah, and they'll probably label me a racist too, in CA that train is never late, even though her lawsuits frightened us enough to reject her as a renter, not the color. Out here somehow they always find a way to turn it around, and make it about skin color or sexual orientation so some bureaucrat can use it to propel himself further up in rank.
Follow
Befriend (2)
8 threads
1,126 comments
Seattle, WA
David Losh's website
Premium
FortWayne says
You should probably stop now.
Follow
Befriend (13)
102 threads
3,764 comments
David Losh says
I'll stop when I'm dead. Until then I'll keep going. It's the American way.
Follow
Befriend (3)
16 threads
1,378 comments
Victorville, CA
Premium
FortWayne says
The American way is moderation.
Follow
Befriend (9)
165 threads
1,548 comments
Premium
Well some people are just entitled. I was at the Kinkos scanning some paper work and sending it over. In walks this lady, dressed to the 9s, iphone in hand and a fancy looking purse. Then she sits in the computer next to me and gets mad and said she can't believe they charge 30 cents a minute to use the computer. She wants to print her resume and gets mad when the store clerk refuses to allow her to print for free. She wonders if she can print out her resume through her iphone for free and when the poor clerk says no, she cusses the world out and walks out!!
Follow
Befriend (13)
102 threads
3,764 comments
JodyChunder says
American way is life liberty and pursuit of happiness. Not moderate fear of being honest.
Follow
Befriend (3)
16 threads
1,378 comments
Victorville, CA
Premium
FortWayne says
That honestly doesn't even make sense. "Reticence" might be the word you're looking for?
Anyway, I wasn't talking about pussyfooting when I said moderation. Moderation is all-American. The opposite is un-American.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
FortWayne says
what did her color have to do with her being a bad rental prospect? so yeah... racist... means seeing people as different based on race...
Follow
Befriend
16 threads
385 comments
robertoaribas says
I think you mis-understood him. I believe he meant to say that she wore one of those fancy colored designer coats that indicates her family spends above their means and likely has credit issues. Then he rejected her due to ongoing litigation.
Follow
Befriend
19 threads
1,534 comments
Los Angeles, CA
I once had a prospective tenant tell me he was suing his current landlord over allegedly the older electric system blew up his 8k big screen. This house i had was 40 years old i was like uhhh see ya! The dumb circuits break when i vacuum the house on every home i ever had.
Follow
Befriend (2)
8 threads
1,126 comments
Seattle, WA
David Losh's website
Premium
I worked for a property management company as the fix it guy for a lot of years.
Fixing it also meant dealing with problem renters. I still say today in my business that if you are talking to me you're a problem.
I found that white people presented the worst problems. It may have been a numbers game, but no matter how I sorted it out, it was white people that talked about lawyers, didn't pay, trashed the place, and wouldn't call when there was a problem.
Follow
Befriend (13)
102 threads
3,764 comments
robertoaribas says
Only your reading comprehension Robert, only that.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
FortWayne says
Fort: if you say, "one time we had this lady who came in, all entitled, and admitted she was suing her prior landlord..." fine.
YOU felt the need to mention she was a lady of color, so that was apparently an important distinction in making her less fit to rent to...
My reading comprehension is fine; Many racists wouldn't self identify as racist...
Follow
Befriend (13)
102 threads
3,764 comments
robertoaribas says
Being black isn't a crime, it's a description if a shoe fits. And the only nit pickers are those politically correct lying their ass off liberal sissies seeking a career in public office.
Follow
Befriend (3)
28 threads
747 comments
Tarzana, CA
FortWayne says
Hurray for Liberal Sissies!
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
Lease signed on home #14... $1500 a month!
Mortgage is $705 a month, I put 30% down, financed the rest at 4.25%.
Mortgage less than half of rent...
Home was a short sale, original purchaser backed out because of some things on the inspection report:
1. minor roof issue over patio, a few hundred to fix.
2. termites in garage wall: $650 to treat, with a one year whole house warranty, renewable for $150 a year. (to the uninitiated, there are two types of homes in AZ, those that have had termites, and those that will get them)
3. Rough look of interior. some drywall to fix, and repaint, it had original builder paint from 1999.
Done, rented earnest check deposited.
Home is 2500 square feet, 3 car garage, rv gate huge lot single level, all tile inside with a pool... No way in hell a builder can put anything similar up for less than $250,000 ever.
Follow
Befriend (23)
55 threads
3,795 comments
Scottsdale, AZ
robertoaribas's website
Buying my 15th home in 10 days...
I just checked the value on trulia: $127,000. On zillow $118,000. I comp it today at $125,000. [at least after I clean it up]
Those estimates are about to crash, sorry neighbors, because I'm buying this one for $86,000. [actually $86,500 but they are paying all closing costs...]
Now, as often happens, one of my over anxious fans on here, like yup, or that really sad case, underwearman pulls up the home after I buy it, and starts chortling "oh the zillow estimate is only this...blah, blah, blah" YEP, because I crash the estimate! I won't be surprised to see the whole area take a hit when my sale records, that is what has happened on my other purchases. Seems to take a good six months to a year for my purchases to recover afterwards as well.
Follow
Befriend
4 threads
206 comments
Redwood City, CA
robertoaribas says
It's not a given that a rental is governed by federal fair housing laws or corresponding state laws. Many rentals are exempt, such as small owner occupied buildings, some single family housing, etc. State law of course varies from state to state.
I'm surprised somebody who owns several rental properties isn't aware of this.