Real Estate investing

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Re: Real Estate investing

Postby Ray » Wed Jun 13, 2018 2:53 pm

Dennis, thanks for the lead. I’ve just looked at the website. There is a lot of good stuff here - but I’m relived (is that the right word?) to find some mistakes in the tax commentary!

I tend to advise BTL portfolios in excess of 10 properties / £3m. Would I still find it useful to contribute or participate?

Cheers

Ray
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Re: Real Estate investing

Postby Freedomforall » Wed Jun 13, 2018 10:33 pm

Dennis and Ray,

I think I have accomplished my initial mission. We have found a common interest. Dennis you said it well with your illustration about sitting around the palm. We are separated by oceans but we have a common interest! I have learned many lessons in my 10 years with rentals. The most important and helpful one has been to run background and credit on all applicants. They pay for this with an application fee. I realize with credit that people will have dings. I look for a recent pattern of trying to improve those things. If they have a recent automobile repo or anything major that occurred within the last year, it is a refusal from me. We just reently started using a free service that collects rent and deposits it into our checking account. I had many bad experiences before I started performing background and credit checks.
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Re: Real Estate investing

Postby Sinned » Thu Jun 14, 2018 11:22 am

Ray, I PM'd you on further details. BTA it's "relieved". "relived is to go through something again, mostly an unpleasant experience. Just pulling the proverbial. :lol:

FFA, for those not interested read no further. I PM'd you also. Hope what I said was useful. 8)
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Re: Real Estate investing

Postby moonshadow » Fri Jun 15, 2018 1:48 am

Sinned wrote:When we buy a property none of know what is beneath the topsoil ( or isn't in the case of sink holes ) unless and until we have to dig deep for some reason or it's noted on the deeds which should be picked up by the solicitor who acted for you. It is assumed that the solicitor had actually READ the deeds, rather than just skimming them, to pick out any caveats or conditions.


Unless there is some kind of easement, I've never had a deed that disclosed the condition of the soil. Then again, I've never owned a house that was built after 1950. Every deed I've seen more or less just covers the transfer of ownership from one party to the other and involves recording it at the county court house. I think my house in Bedford had a deed that went into the agreement of a shared well as well as a septic easement from a neighbors leachfield on my property, but even then, this didn't actually cover the condition of the soil itself.

From what I have learned, the proper thing to do, either when buying unimproved land to build a house upon, or in my case, buying an older house whereas the septic isn't expected to last much longer is to have a "perc test" done prior to signing a purchase contract. Either the prospective buying can fork over the money, or the seller, however they want to work it out. I've heard that when selling raw land, it's better for the seller to have a recent perc test done to help encourage the property to sell.

A perc test would reveal any rock underneath. For those who don't want to spend the money, I've learned you can basically take a "calculated gamble" with some post hole diggers and see if you can dig down 36 inches in about six different spots. It's not a "fool proof" guarantee, but it at least gives you an idea of what's under the grass so you're not buying blind. I've learned a lot from the Virginia Health Department over the last few weeks as to what they look for before issuing a septic permit.

After all the assumption is that all is ok as they managed to dig deep enough for the house foundations.

Again, most people perc the lot before actually starting on the construction of the house. In fact, the perc test is normally the FIRST thing people do before anything else (even drafting the home). After all, if it won't take a septic, it's useless, unless you've got deep pockets and want to pay for a alternative system. [0]

Advertise for a contractor to deposit some topsoil from a local building site? No?


I've heard that doesn't work too well, unless you let the soil sit for a few years to acclimate itself to the native soil. I'm not sure what the science is on the matter, but I do know the local health department won't approve it.

No, the system we're looking at, that I have a soil engineer working on as I write this, is some kind of a sand filter/mound system. I'll know more about what's what hopefully next week.

[0] I'm not an expert in this, but my hindsight is EXCELLENT! :wink:
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Re: Real Estate investing

Postby Freedomforall » Fri Jun 15, 2018 1:56 am

Here they want even let you build until the health dept. comes and perks the land. I would be suspicous of anyone selling land that has not been perked as they may be hiding something. You are correct in your thinking that a seller would be wise to advertise the land as perked.
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Re: Real Estate investing

Postby Freedomforall » Fri Jun 15, 2018 2:00 am

Moon, you may also want to find out if there is a disclosure law there. A disclosure statement is a short document signed by the seller that lists “any material defects known to the owner” about the property. Tennessee has one and you may have some recourse against the seller to collect for repairs you have to make.
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Re: Real Estate investing

Postby Freedomforall » Fri Jun 15, 2018 2:15 am

Moon I just searched and found this: Virginia law does not require sellers to disclose much information about their property at all. That is a big heap of rubbish.
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Re: Real Estate investing

Postby moonshadow » Fri Jun 15, 2018 2:41 am

Freedomforall wrote:Moon I just searched and found this: Virginia law does not require sellers to disclose much information about their property at all. That is a big heap of rubbish.


Yeah we're pretty much s.o.l. on that. However if we can get that sand system approved then I'm getting some ballpark figures of around 10 grand. We paid $63k for a house on a road where many houses go for twice that. I guess at that price we can expect a few issues here and there. Hopefully this is the worst of it.
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Re: Real Estate investing

Postby Freedomforall » Fri Jun 15, 2018 2:52 am

What you are dealing with is a major expense. Roofs and A/C are also. I am not completely familiar with the system you are installing. I actually just took time to read a little about them. They seem to be very efficient and should be a great choice for you. I just found this site and you may have seen it. It might be an option for you. https://www.aero-stream.com/septic-system-cost.html It is my nature when someone has a problem to try and help. I would definitely check the site out. It claims to have saved many people who had a failing system.
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Re: Real Estate investing

Postby moonshadow » Fri Jun 15, 2018 3:43 am

Freedomforall wrote:What you are dealing with is a major expense. Roofs and A/C are also. I am not completely familiar with the system you are installing. I actually just took time to read a little about them. They seem to be very efficient and should be a great choice for you. I just found this site and you may have seen it. It might be an option for you. https://www.aero-stream.com/septic-system-cost.html It is my nature when someone has a problem to try and help. I would definitely check the site out. It claims to have saved many people who had a failing system.


The roof looks to be about 10-15 years old, but it's metal so it should last the rest of my life. As for the A/C, currently we use two window units in the summer and an oil furnace/propane heater (in the living room) in the winter. Eventually I want to have a heat pump installed. That cost shouldn't be as much as the septic. Additionally there aren't as many government regulations with heat pumps. An electrical work permit is required, but that's it. Roof work normally doesn't need a permit unless you are tearing into the decking. Windows and siding don't require a permit either.

Back to the septic, two permits are required from my understanding, the first is the VDH (Virginia Department of Health) permit, they are the first stop. Once that has been obtained (after a satisfactory perc test performed by the VDH, or a satisfactory alternative system design), then a standard building permit is applied for.

... the health permit is the important one. They are the ones who verify the system is to code and can operate safely without becoming a health hazard to the community. The building permit is just something to make the county a little money... nothing more.

As for the aero-stream system, I'm afraid that ship has sailed already. Upon our investigation with the VDH, we determined (by digging it up) that my current system is about as far from current code as you can get. It has a small septic tank, aprox 500 gallons, a little D-box attached to it's side that is about 3 feet cubed. There are NO "tees" in either the tank or the D-box. There is a little 4 inch hole between the two and that's it. The D-box has two 3 inch terra-cotta drain tiles sticking out of it. They are buried about 6 inches under the soil. Both extend a short ways (about 4 feet and 10 feet respectively), turn a 90 degree angle, and stop where they appear to discharge over a shallow "gravel pit" with about an inch of top soil over it.

How it lasted 70 years is anyone's guess. But I believe it was in failure long before I moved in. They (the sellers) just kept it on the down low. According to the health supervisor, systems like mine are not uncommon in Appalachia, what with all the limestone and so on making for difficult sites. Prior to the 1970's, permits weren't required and people just did whatever they felt would work. "Straight pipes" discharging raw sewage directly into nearby streams is very common according to what I was told. It's HIGHLY illegal, but what are you going to do... condemn a third of the homes in this region and put all those people out on the street? Outhouses are not unheard of either.

Virginia has approved a septic system that can discharge to a small stream. It's basically like a little mini-treatment plant like a municipality would use. The installation cost, as well as the regular maintenance cost are high, but you never have to worry about a failed drainfield since you don't have one. The problem is, I'm not near a stream.

This has been a pain.... it's the first time I've purchased a house that wasn't connected to a municipal sewer system, and so far I'm coming to regret it. My (at the time) limited experience with septic system comes from what I witnessed as a teenager in Bedford. As such, central Virginia isn't as rocky so septic systems aren't as challenging. After driving these roads for going on five years, observing the highways cut into solid rock as they snaked through the mountains, the thought just never occurred to me that that same rock would be under my lot.
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Re: Real Estate investing

Postby Fred in Skirts » Fri Jun 15, 2018 3:55 am

Moon, you should be as luck as I was when I bought my land. It is SAND as when they came out to do the perk test they could not get a time for the water to perk into the ground. Because by the time the tester reached for his stop watch all of the water had disappeared into the ground. Estimated perk time for 1 gallon to fully perk was listed as 1/4 of a sec. All I needed was 50 feet of drain line and of course a 1000 gallon tank. The system is no longer up to the new standards but I will not have any trouble until some time in 24th and half century. :lol:
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Re: Real Estate investing

Postby Sinned » Fri Jun 15, 2018 11:32 am

Moon, my suggestion about the soil was just ribbin'. I know that environmental concerns nowadays wouldn't allow it because of mismatch and the soil, probably from a building site, may not be of very good quality. Also the possibility of the transferal of pests and so on. Here, with a greenfield site, the main contractor will do several test drills to determine base conditions, not just to determine the rock underlay but to look for such as cavities and underground springs. In certain parts of the country they need to look for old coal mines which can undermine (?) house foundations as the tunnels give way. I had an interesting experience just after I finished university. I had a fixed-term job as a Cladding Manager supervising the erection of metal cladding to a series of buildings for a brewery. The main contractor had done the usual test drills and found nothing untoward. Now, one of the main buildings was T-shaped and, unfortunately for the contractor, when they came to dig the foundations for the building they discovered an underground spring on the right corner of the top of the T. They never found the bottom when they reached the extreme range of the digger so they had to put in some supporting steelwork tied into the ground around the spring and a few tons of reinforced concrete to provide support the for the building. They couldn't have moved the building over because of other buildings on the site but if they had turned the building around 180 degrees ( which was possible even though other work on fuel pumps would have had to be changed, then the foundation work would have missed the spring! I had some photos somewhere of the enormous hold they had to dig. Oh,well.
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Re: Real Estate investing

Postby Kirbstone » Fri Jun 15, 2018 12:28 pm

We bought a large boggy fallow field at auction in 2000 as did several others that day, buying adjacent plots.

There were no houses there at the time and one-off spec-build planning applications were going to be a gamble, which several of us took.

Soil is wet acidic with some peat in, over dense silvery marl with limestone rock down 5-6 meters. Initial perc. tests were negative to say the least, but a clever engineer had all the answers and our house now sits on a radon-proof reinforced concrete raft standing on no fewer than 37 piles driven down to the bedrock underneath. Take away all the soil and our house would look like an oil production platform.

Percolation was achieved by building a small hill which had a grid of pipes &c in it and was planted with trees. A 'puraflo' electric pump keeps the liquid level in our large septic tank permanently low, the solids needing to be evacuated every two years professionally.

Artesian-pressure water was found behind the future house at which point a 6-inch dia. hole was drilled to 71 meters depth into the rock, a pipe serving to keep things open above the rock. An immersion electric pump was placed at the bottom which delivers Pollardstown Fen water to a filtration system installed in our barn. J.Arthur Guinness discovered this water source in the mid- 1700s, had it piped 30 miles along the embankment for the new Grand Canal to his brewery in Dublin and the rest is History.

Today we have six near neighbours whose houses have been built like ours on their respective plots.....enough business for the phone people to bring broadband and the electric people to wire us all in.

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