Yes, it is a large percentage, but we might as well because we have more pressing matters, such as gaining friends and other
useful things, so agreeing to it would be useful. Is it possible for him to manage multiple propeties, should he/she take a cut of each?
You contact the property manager and agree to his terms, starting out with a payment of $100 for January, with no
proration. (-$100) Inquiring if he'd be interested in managing multiple properties, he explains that yes, he is
extremely interested, and that this is exactly what he does for a living. At the moment he's handling 13 different properties for 4 different investors, and would be delighted to take on more. In fact, he offers to keep an eye open for you for future rental opportunities in the area. Since he's "in the business" so to speak, he regularly sees foreclosures, sellers motivated by death or inheritance, or other potentially good deals to buy and rent properties with a positive monthly cashflow.
You thank him for the offer, and explain that you'd like to hear of any possible deals he comes across, but that you have at most about $45,000 in cash to work with. He explains that that's more than most investors have on hand, as generally they take out a loan to leverage their cash into more properties. But if you're more comfortable buying only properties selling for little enough that you can buy them outright for cash, he'll see what he can do.
New expense: (-$100/month property management for Dayton, Ohio house.)
make (better) friends with Gilbert and his crew
get them used to us hanging out together. Do geeky things like design and test things which may or may not be related to villany. Just team cohesion things.
Yeah. We need brainy people to figure this stuff out.
Yeah. Just make sure we don't push it too much. Don't assemble them into the League of Evil yet.
Jaunary 10, 2012A few days go by uneventfully. Beginning to feel like you're letting time slip by unproductively, you scour the internet for anything that might give you an inspirtion. After a few hours something catches your eye and you give Gilbert a call.
You: "Hey, Gilbert."
Gilbert: Hey, Bob. What's up?
You: "I...uhh...happened to notice that there's a computer swapmeet this Saturday.
Gilbert: "Edinger and Grand in Tustin?"
You: "Oh. Yeah, that's the one. You know about it?"
Gilbert: "Yeah, I go pretty regularly. Wanna come?"
You: "Actually I was thinking maybe we could get together with Stan and Clara, and make a daytrip out of it. Maybe buy some fun toys, then get pizza and hang out."
Gilbert: "Sure, that sounds like fun. I'll give them a call."
Saturday, January 12, 2013The next two days go by quickly and come Saturday, you meet up with Gilbert, Stan and Clara at the Tustin swapmeet.
To your eye, most of the stuff for sale is antiquated junk, but every now and then of of the others gets all excited over some contraption or another.
Gilbert: "Whoa...is that a VAX Dectape?"
Clara: "Not as cool as this acoustic modem!"
Stan, for his part, is mostly silent while the other two dig through the various piles.
You: "Hey, Stan."
Stan: "Yeah?"
You: "What's your story?"
Stan: "What do you mean?"
You: "Well, Clara does phones, cellphones, etc. Gilbert seems like he's into anything: computers, programming, robots...seems like half the time I think of something he already knows about it. What about you?"
Clara: "Stan doesn't like to talk about himself."
Stan: "...hey, it's not like that."
Clara: "Don't worry about Stan, Bob. He'll open up to you eventually. It just takes him time."
(Stan just smiles awkwardly at the ground.)
Gilbert: "Yeah, don't worry about it. But when you get the chance be sure to ask him why he carries the lasers around."
At that comment, Stan scratches his forehead as if to give him an excuse to cover his eyes and Clara punches Gilbert playfully in the arm. He mockingly falls to the ground and feigns injury. You feel like something significant is being left unsaid, but perhaps now is not the time to pursue it.
The rest of the day is spent chatting, getting to know each, and generally goofing off. You end up getting dinner together and playing miniature golf. (-$30) It's sort of a surprise to you to see how Gilbert apparently has friends that he's comfortable hanging out with. During elementary school he was always the geeky loser, and you were his only friend. Now, he's the one who knows people.
Buy snazzy hat.
You also buy a snazzy hat. (-$40)
Come evening, you each go your separate ways. Upon your return home, you find an email from your property manager explaining that he's found a huge 4 bedroom house in Dayton being offered by a distressed seller:
Apparently it's already occupied by a tenant who's been there for years paying $600/month. The house is appraised at $120,000, but the owner had some sort of financial catastrophe happen and he needs to cash out, so he's asking for $100,000. You point out that it's way beyond your budget, but he runs the numbers for you, and proposes that you offer $90,000. If the two of you negotiate the deal personally you can avoid brokerage commissions, and probably get away with paying only about $92,000 total. With a downpayment of twenty percent ($18,000), you should be able to get a 5% interest rate on a 30 year loan. The end result is that you pay:
$18,000 downpayment
$2000 in fees
$386/month mortgage payments
$840/yr property taxes
$100/month property management
That works out to $556/month over time, and there's already a renter paying $600/month. Not only is it a $44/month positive cashflow, you'll be picking up $30,000 in
equity on day one, since that's the difference between the appraised value and what you're paying. Of course, it does mean carrying a loan of nearly $100,000 for potentially years.
The manager suggests you think about it overnight and give him a call in the morning to let him know whether or not you want to proceed.
Current statuswhat do you do?
Author
Topic: You are a Suburban Supervillain (Read 61912 times)