Landlords and evictions

[Nathan Sawyer]

Hello Biggerpockets!

My wife and I just got married a few weeks ago and are getting back into the real estate investing swing! We are looking in the Norfolk, Portsmouth VA area. After analyzing a bunch of deals and combing the market we found 2 that hit our criteria.

Read an article the other day about landlord and evictions cases possibly going to the Supreme Court. Landlords are having a tough time during this pandemic collecting rent and not being able to evict bad, non-paying tenants. There seems to be a possibility of the evictions moratorium extending past June, at least that's what we read for VA.

Both the deals we found say in the description that they have tenants in place and leases are up next year sometime.

My question to the Biggerpockets community is if anyone else is experiencing a hesitation in investing tenant occupied properties with the evictions moratorium in place? This law produces a risk of new investors inheriting non-paying tenants. Current landlords may be selling properties to avoid foreclosure due to tenants having an out to not pay rent due to the moratorium. Curious to hear the community's thoughts!!

[Patti Robertson]

@Nathan Sawyer For a 1-4 unit, always consider tenants temporary. Yes it is much harder to get tenants removed in VA than it has been in years past, but we can still get it done. For more than 1-4 units if the seller did a terrible job at tenant placement, or filled units with anyone just to have a rent roll to sell, it can be incredibly expensive to turn the property around. Ask for the current ledger balance to be included with the rent roll. If possible I like to get the tenants names so that I can look in the court records and see what kind of landlord-tenant history they have. Even professional property managers who don't do a good job of screening place tenants with outstanding landlord-tenant judgments. This is how you can tell if it's a healthy rent roll.

I would personally caution you about buying in Portsmouth. While I do on rental property there and I manage a lot of rental property there, I will no longer by there. There’s lots of reasons. Google Portsmouth Virginia in these forums and you’ll get an earful.