slumlord: Wise or foolish

[Pat Bahn]

Hi

I have a shot at buying a small MFDU in DC that has section 8
tenants in it. Now, the plus side is that voucher should pay me the
rent. The negative is you are dealing with some real low level
characters.

The deal looks like it will produce a cap rate of 13, so
that's decent returns and it's close to mass transit so the area should improve over time.

But what do you all at BP say?

[Ryan Pyle]

I have over 50 low income units, most are sfr, half are S8. The key is to screen your tenants and then treat them like gold once they are in. I have found that if you treat a good low income tenant well, they will stay for a long time. By treating them well, I mean respond to maintenance calls immediately. I do not mean letting them slide on payments or treat your house poorly. You have to lay down the law and let them know that if they treat you well you will be the best landlord they've ever had. For the most part they are used to slumlords and think that we are all slumlords. If you prove them wrong they will be great tenants.

I have found the toughest part of low income investing is break ins and vandalism during vacancy. Hence my efforts to keep good tenants in place. I have started putting alarms in my sfr's when they go vacant. It's way cheaper then replacing plumbing and fixing all the damage done from the break-in.