Header Ad Module

Collapse

Announcement

Collapse
No announcement yet.

exnzpat buys a rental!

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • tpr2
    replied
    Nice work expat

    Leave a comment:


  • exnzpat
    replied
    Day 1

    Well, I got up early and drove the hundred or so miles to the house. I signed for it last week and received the keys in the mail a couple of days ago. In my truck I packed all the tools and equipment that I should need for the job. I have a camp bed and sleeping bag, radio, Lap Top, at least a week’s worth of groceries, and my trusty lab mix, Lincoln.

    It’s the summer holidays here and my kids will be in various camps over the next week and the wife will do the running about town with them etc. That leaves me to work on this new project by myself. I work faster this way – no distractions – you understand.

    I’ve always disliked the term “flipping” but Mrs. Exnzpat and I have done it for years. Our first home became a rental as did our second. We kept moving on to bigger and better homes for ourselves about every two years. We really didn’t realize what we were doing at the time. Some houses we rented and some we just sold outright. We fixed them up while we lived in them -- we thought that’s what everyone did!

    The show “Flip this House” is a little contrived. Too much money is getting wasted on stupid stuff, like ripping out the drywall or smoothing out textured ceilings, also, way too much drama – contractors yelling at each other and such -- not very realistic. If I write this right, then over the next two weeks, you will see that the key to doing a property like this is organization and a little hard work.

    My biggest beef, and probably the source of my negativity towards some of you on PropertyTalk, comes from Posters who view real-estate investment as some frivolous game that any idiot can play – just front up the dollars and you are in. It is not that simple. It is hard work – and some people just refuse to accept it!

    I have to admit I’m not sure what it will rent for. Rent in the States is calculated on a monthly basis so my best bet right now is realistically around $700 per month. The house does not have a garage, only a carport; and that is a big negative in this Country during winter. My plan is to build a garage sometime over the next five years. But, at the moment, as a rental I’ll take a hit – my best bet to improve on the rent is to do a real nice job on this rehab.

    The purchase price on this house is not unusual for this area. But, for this much of a home, it is. This is the third contract I’ve put on a house in this town in the last year and a half. I’ve been looking for a long time. We haggled with the bank for two months on this deal. We fronted up a deposit of 20% which is normal – but get this – in the end they offered to finance our deposit! No wonder the banks are in trouble! Banks can be quite fussy when you buy from them, and quite impersonal. It was not easy because they wanted to sell on their terms not mine. Apparently I have a very good credit rating and this is why they offered to finance the deposit. The $9000 I “saved” from the deposit is what I’m spending on doing the rehab. You might say that’s a good deal -- but not me. The banks goal is to maximize the interest portion of a mortgage over time, and borrower’s goal is to minimize his principal portion over time. Either way, the borrower is stuck with the interest; this is how, in a nutshell, why a bank wins the day every day.

    All I really know about this home is that it belonged to a “newbie” landlord who got over his head. Basically, what happens to guys like this (especially over the last six years) is that they buy a rental (or a Flip) and then draw a huge line of equity on the place. Instead of putting the money back into the house – they live off it! Bad move -- very dumb – life has a way of catching up with people like that. And so here I am!

    I arrived at the house at 10am and unpacked. Lincoln bolted from the car and began sniffing about – looking for rat’s maybe?

    I set up the coffee machine, microwave, laptop etc. I’ve decided to start work in the Master bedroom first so I set up camp in the dining room. The only appointment today is the servicing of the Furnace and Air-conditioner. That’s at 1pm. So, I drove over to the local rental store and rented a wall-paper stripper and went to work in the Master bedroom. At lunchtime I cleaned out the very suspect refrigerator and for good measure; cleaned the gas stove – very nasty. I fed Lincoln, and left him to continue to familiarize himself with the house and the yard.

    The Furnace and Air-conditioning man didn’t show – so I called and bitched-them-out. They promised that someone would be around first thing in the morning.

    I have removed all the wallpaper in the Master bedroom and am now working on the removing the glue etc. Unpleasant work, but monotonous and soothing, all at the same time.

    Well, I worked until 11pm. I finished the wall clean-up in the Master bedroom and couldn’t stop myself. I put the undercoat paint on the walls and painted the ceiling; a very satisfying first day. It looks like Lincoln is ready for bed – and so am I. Goodnight.
    Last edited by exnzpat; 17-06-2009, 02:48 AM.

    Leave a comment:


  • Bluekiwi
    replied
    He has probably bought in the US equivalent of Tokoroa or in that US town built on nuclear waste landfill, that name he mentions does sound famaliar

    Leave a comment:


  • One
    replied
    Originally posted by eri View Post

    you could easily have a near new house being sold in a small city hundreds of miles from pretty much anything except the chrysler SUV factory that was built there 10 years ago on gov grants to bring employment to an unemployment blackspot

    now that the factory is closing who wants the houses that were built 10 years ago for the workers???
    But then the market value's 45K, not 170K.

    Not that I want to rain on expat's parade, was just wondering whether there's something about foreclosures in US, so that if you sell a given house on the open market you'll get x but if it forecloses you get much less than x. Doesn't sound like it.

    A house at 45K still sounds like a really good deal, as long as you can get tenants in.

    Leave a comment:


  • eri
    replied
    Originally posted by One View Post
    Speaking from total ignorance here, how come foreclosed places are selling so far below market value? How are they determining market value?

    Sure sounds like a great deal - good one!
    the usa is a big place and as they say location location location

    you could easily have a near new house being sold in a small city hundreds of miles from pretty much anything except the chrysler SUV factory that was built there 10 years ago on gov grants to bring employment to an unemployment blackspot

    now that the factory is closing who wants the houses that were built 10 years ago for the workers???

    probably not what's happening in this case but similar situations are happening and the buyers need to take a leap of faith in the long term to buy them

    Leave a comment:


  • Bob Kane
    replied
    Well done, expat.
    Signing up with RM,PJ for a bit of coaching was an excellent move.
    You'll be driving a red Ferrari in no time (leased of course).

    Leave a comment:


  • tpr2
    replied
    yep expat is up to something.

    What would expat say to any of us if we said we had bought a property for $45,000 but the market value was $170,000?

    No deposit Expat?

    Leave a comment:


  • Dean@Massiveaction
    replied
    March alone posted record highs in foreclosure activity, with 341,180 properties receiving foreclosure filings,
    LINK

    Leave a comment:


  • revdev
    replied
    Originally posted by exnzpat View Post
    foreclosed properties
    constructed in the seventies
    Ranch style
    1800 square feet
    I have vacation
    quick rehab
    I’m going to have to get renters in
    You're no expat, you're are full flown convert!

    Leave a comment:


  • One
    replied
    Speaking from total ignorance here, how come foreclosed places are selling so far below market value? How are they determining market value?

    Sure sounds like a great deal - good one!

    Leave a comment:


  • Heg
    replied
    Originally posted by Bluekiwi View Post
    I hope for all our sake's you a woman Rueban
    Why? .......

    Leave a comment:


  • Dean@Massiveaction
    replied
    The numbers sound right based on what I see on the net in the USA.
    A lot of stuff is selling 20 to 40 cents on the dollar.

    Leave a comment:


  • Strummer
    replied
    I think ExNZPat is having us on... there are far too many cliches in his/her post....I smell a rat...

    Leave a comment:


  • Dean@Massiveaction
    replied
    Nice one expat.
    What will it rent for and are there other state taxes etc. to pay?

    Leave a comment:


  • rueben
    replied
    Davo - the first series wasn't - with Richard Davis - but the second series with the other turkeys was/is rubbish - it was proven that one of the purchasers was a mate of the Armando's and just went through the motions of buying/showing the profit when in fact he hadn't.

    Richard Davis has a new series called "The Real Estate Pros" which I'm am gonna try and find on Youtube.

    Leave a comment:

Working...
X