Hi All,
In the last 3 months we have brought 2 properties in NYS - one in Syracuse and 1 in Buffalo. We brought through Brenans (BPI) and although their fee isnt cheap, especially when you consider it as a % of purchase price, I do think they give better servcie than alot of agents I've used before (non NYS). I also consider it a payment for their local contacts, all of which have been fine. Actually the rental agents are very slow to reply to questions, but they are doing their job and so far no problems.
I have been in contact with other Buffalo investors, through companies such as Ajay Ajhua and they invested pretty much the same money and got bad houses, non rent paying tenants (if any) and rental agents who disappeared - so there are horror stories out there.
Completion/closing - went really smoothly, minimum of paperwork and from reserving the Brenan proeprty took 4 weeks. Cash purchase.
Repairs One house needed $5k of work, we will get this done over the next 12 months. The rental agents will handle this (no fee). The other one only needs a few $00. We were going to buy a vacant one, but it fell through - just as well because I now think that if it was vacant although the repairs on the home inspection report may be minimal, it would need money spent to attract a tenant.
Cashflow - some agents collect rent monthly, but only pay you quaterly in arrears. Some bills such as taxes and water need to be paid upfront on ownership.
'Hidden' costs - if the property is vacant the agent charges approx $500 finders fee. Lawn maintenance is a usual landlords fee, $34 per month for 8 months.
So, 4 months in I am happy with what I've purchased, the purchase figures are pretty much as Brenan anticipated as are the yields of 30%ish. There's been little hassle and rent has been paid on time, repairs have been quoted for (as BPI said).
Concerns for the future
mortgage. The plan was to hold for 12 months and then get a mortgage on the market valuation at purcahse (higher than the price paid). Although mortgage costs are high, this would have meant we got most of our cash back. I'm now having trouble finding a lender to lend under $70k. Anyone have any contacts?
Tax issues. I would like to do my US returns (state and federal) myself to save money (I am an accountant),but I'm finding it hard to get the right information and its taking alot of time. So an option is a local accountant for £500 will do mine and my partners returns. Then obviously I still have to do our UK returns and offset this US tax.
So, in conclusion, I think all's pretty much as I imagined. This probably isnt for the fainthearted or new investor, but with fairly small cash sums involved and as we are in need of rental income (several off-plan investments or cash drains!) I am quite happy to take a punt on these properties and the low dollar. That said, we'll not be buying anymore unless we can get finance.
