pulling+equity+out

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pulling equity out (by sam [TX]) Apr 10, 2024 2:35 PM
       (by plenty [MO]) Apr 10, 2024 3:04 PM
       (by NE [PA]) Apr 10, 2024 3:12 PM
       (by Busy [WI]) Apr 10, 2024 3:39 PM
       (by Richard [MI]) Apr 10, 2024 3:46 PM
       (by ken [NY]) Apr 10, 2024 6:58 PM
       (by MC [PA]) Apr 10, 2024 6:58 PM
       (by DJ [VA]) Apr 10, 2024 7:27 PM
       (by Ray-N-Pa [PA]) Apr 11, 2024 8:11 AM
       (by S i d [MO]) Apr 11, 2024 8:23 AM
       (by Busy [WI]) Apr 11, 2024 10:54 AM
       (by Hoosier [IN]) Apr 12, 2024 11:53 AM
       (by Pmh [TX]) Apr 12, 2024 1:48 PM

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pulling equity out (by sam [TX]) Apr 10, 2024 2:35 PM
Message:

My tenants recently asked me if I have a one bedroom available because her sister is looking for a one bedroom. I don't have any one bedrooms available but the complex where my tenant lives has 3 one bedroom condos for sale. I currently have several loans with my lender but half of those have payments under 500 which is manageable. If I choose to purchase one of those one bedroom condos my payment would be under 500. I can get a 15 percent ROI on that one bedroom. I have quit a bit of equity in my portfolio which I have not leveraged or used. I have a good relationship banker but with that being said I do have over 6 loans with him and I also have 1 potential eviction coming up and one vacancy which my property manager says its a solid property that should rent soon. Even with those 2 issues I am still cash flow positive every month and have 3 months cash reserves. I am comfortable taking risk and of course pulling equity out helps build portfolios but I am not sure if I should tap into my equity for this one property or continue to let my equity build in case something better comes along or keep the equity in my portfolio. Any suggestions or thoughts would be helpful. Thank you for your time. --72.176.xxx.xxx




pulling equity out (by plenty [MO]) Apr 10, 2024 3:04 PM
Message:

Sam and you would do all this for someone you haven't even screened yet? And by the time you go thru the process of locating, application for bank loan etc,, house inspects, etc she will have found another place. --172.59.xxx.xx




pulling equity out (by NE [PA]) Apr 10, 2024 3:12 PM
Message:

I would not invest in a property because my tenantís sister maybe, kinda, hopefully wants to live there. I buy or sell properties when it works best for me. --24.152.xxx.xx




pulling equity out (by Busy [WI]) Apr 10, 2024 3:39 PM
Message:

If the sister doesnít pan out, is there a market for one bedroom condos? If there is, this could be good opportunity. ( bear in mind, or bexar in mind, lol!, I am but a small-time landlord, 4 little houses a dozen years in the biz. But, I do love when a good opportunity knocks. )

If tenant is a good tenant, and recommends her sister, assuming tenant has respect for you, she likely has a sister that is also potentially a good tenant. If ONE good tenant is out there looking for a place, such that they are putting feelers out there, likely others are looking. And looking. Research what is available in the tenant pool for those wanting one bedroom. If you are in a big city, and its a nice area, I would suspect demand is good.

So, maybe you want to buy two, or three. (Iím an enabler, go buy more properties. ) Iím thinking that most owner occupant condo buyers want two bedrooms, one bedrooms might be a good buy. I only bought 2/1 little houses because its a great size house for a rental, not as much competition from would be home buyers, who typically want a 3 bedroom house. In rental condos, the one bedroom might be a good niche. --172.59.xx.xx




pulling equity out (by Richard [MI]) Apr 10, 2024 3:46 PM
Message:

Condo's have homeowner associations which can change the rules. Then you are at their mercy.

If you want to buy something, why not get a small place on the edge of town or in the country. There, if necessary, you can add some travel trailers that might pay rent and perhaps grow vegetables for food if needed.

We are going into hard times from the look of it and it might be a good idea to have places with multiple uses, just in case. --75.7.xx.xx




pulling equity out (by ken [NY]) Apr 10, 2024 6:58 PM
Message:

i would never buy a condo or anything in a HOA --74.77.xx.xx




pulling equity out (by MC [PA]) Apr 10, 2024 6:58 PM
Message:

I.have learned to never go out of my way when there are so many unknowns and I have no real.gain. --73.230.xxx.xx




pulling equity out (by DJ [VA]) Apr 10, 2024 7:27 PM
Message:

I agree with everyone else.

Regarding pulling out equity in general:

I like to get a HELOC (Home Equity Line Of Credit), not a mortgage/second mortgage - so I have instant funds available when a good opportunity shows up.

I can use the HELOC money to fund a quick, cash deal.

It also makes the property look encumbered if an attorney starts snooping around. --68.229.xxx.xxx




pulling equity out (by Ray-N-Pa [PA]) Apr 11, 2024 8:11 AM
Message:

There has been quite a few negative responses which I agree for the most part I want to share some positives - these are the things you are doing right in my eyes.

1) Cash Flow: As long as you have the great cash flow, debt is not only okay, it is wise. It allows you to use leverage which allows you to grow. It also offers a certain level of asset protection.

2) Referrals: You are getting referrals and some of them are as good as gold. You should probably reward this behavior so they are inclined to repeat that behavior. A card for an unsuccessful referral is a good start, and a $50 gift card for successful referrals is a good start.

3) ROI - You understand the importance of this which tells me you know how to forecast and understand leverage.

4) Relationship banking - I applaud you for understanding the importance of this

Now for somethings I wish you would work on:

1) Buying - You are off the MLS. I believe the majority of investors start out this way. Time to learn how to find off market deals and you will get blown away real quick on your projected ROI and especially the cash on cash returns.

2) Financing - Does your bank offer portfolio loans? There is a limit on government loan you are suppose to have. There are a couple of work arounds but a portfolio lender opens up so many more doors.

3) Types of investments - I am not a fan of buying in condos. Consider looking at other types of places instead.

4) Screening - Consider that you might be doing all the work you have for someone who might live there for only 6 months before they buy a place. Screen your referrals before acting on them.

You are doing alright and keep on pushing along. You are at point where you need to look at what and HOW you are doing. --24.101.xxx.xxx




pulling equity out (by S i d [MO]) Apr 11, 2024 8:23 AM
Message:

There are three rules when buying condos...

1) Don't.

2) If still in doubt, See #1.

3) Drink a beer to congratulate yourself for following rules 1 and 2.

Imagine having to live under the constant scrutiny of a group of petty bureaucrats whose lives revolve around snooping into your business and fining your because they don't like the color of drapes your tenant installed. That's a COA (Condo Owners Association). I'm thoroughly convinced they are peopled by former Middle/High School Student Body Government persons who never let go of the glory days when they had a name badge that said "Vice President" or "Treasurer".

So to avoid all that hassle and mayhem in your life, just remember the 4th rule.

4) DON'T.

--184.4.xx.xx




pulling equity out (by Busy [WI]) Apr 11, 2024 10:54 AM
Message:

Just a thought about condo/ hoa associations- many on here espouse the idea of being ' just the manager' so they can blame a mythical boss if they need to tell a tenant no. Wouldn't the condo/ hoa function the same as that mythical boss? Certainly, one could have in their rental agreement something about violations of condo rules are tenants responsibility, if deemed tenants are at fault. Or some such, needs better wording.

Of course, a landlord would need to be well-versed on condo/ hoa by-laws, perhaps serve on the board.

Having said that, I have always steered very clear of any association that wants to tell me if I can hang out laundry, or grow a veggie patch, or plant a wildflower patch, or have a rummage sale. So, I admit, I wouldn't prefer owning rentals with those restriction. However, I am very upfront about the fact that I own and maintain my properties. Don't need any layers of liars. --72.135.xxx.xx




pulling equity out (by Hoosier [IN]) Apr 12, 2024 11:53 AM
Message:

We didn't use debt, so it would be a hard no for me. And condos are very different animals...what will you do when the adjoining unit complains about odors or noises? And you mention 15% ROI, but at what vacancy rate? You are making a lot of assumptions that may not work out. --64.38.xxx.xxx




pulling equity out (by Pmh [TX]) Apr 12, 2024 1:48 PM
Message:

I would never buy a condo nor ever a house in a hoa --12.232.xxx.xx



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