How long did it take (generally) to get your first rental going?

Question

Hi Everybody,I have found a very intriguing property (so far) and plan to go see it. If it is "the one", "the first one"…. or, if I have to look at 100 before I find the one, eventually I will have "the first one".How long did it take you to learn how to do everything as a landlord? You bought the property -- how long did it take you to get through the deal, how did you set your closing date? How long did it take for all the "buying parts"?You made the property rent ready -- what did you do to it? How long did your rehab take? You got organized and learned how to be a landlord -- you made a lease, got a lawyer, set your criteria, got some forms and made some rules and procedures and decided how you would manage (or hire out the management and interview and set up someone)You marketed the property -- how much time and money and energy did you put into that?I am curious about "what to expect", and I know every project is unique, but what kind of targets should I make for myself, if I were to decide to make an offer soon?Thank you for any insights. I'm excited and I would LOVE to read all of BP in the next 48 hours or so, but life is happening. I've read a lot over the past year and will keep reading the articles and searching the forums for topics. Karen

Dan C. · Answer

@Karen M. If I had purchased a rental in pristine condition, I would still need a week to double check that everything is in working and in good shape, nothing needs to be replaced. If I had never been a landlord before I'd also envision myself spending a few evenings reviewing all the rental forms I would be having a tenant sign, making sure I was certain what I would enter in every blank when it is time to rent.Then probably three evenings getting my ideas for marketing the property together - where I would advertise, what the copy of my ad would say, that I have good pictures ready to upload for craigslist or other ads, studying ads of similar properties on craigslist. Determining if I will put a sign on the property, where can I get the sign I want to use and the stickers to put my phone number on it.Then if it is a property where there is some work needed, you'd have to add in all the time to accomplish this, with an important variable being the availability of vendors determining when this work would happen.This is speaking as someone with a family and full-time job, other people might need less time.

Dan C. · Answer

@Karen M. As for your other questions, I always try to close as soon as I can because I am in a hurry to get moving getting it rent ready. Once a close has been set and I am pretty confident the close will happen (not concerned about financing contingencies, etc), I start touching base with vendors I am already familiar with to see what their availability is, and perhaps even schedule a time for them to come look after the closing. For vendors who I do not have a previous relationship, I tend to wait until I have closed to contact them.

Michele Fischer · Answer

I'd encourage you to start your landlord education and figure out your criteria and application before you purchase.For us, we started shopping in February, didn't get the first house we put an offer in on. Our first purchase we made an offer the middle of March. We had the inspection 5 days later. We signed papers and closed in late March. This one came with existing tenants, but others that we have purchased we rehabbed for one month to make it look better, then marketed and finished rehab in another month and had it rented soon after.A quick closing benefits you and the seller, no reason to push it out farther than what they are requesting and is practical for the paperwork side.Hope that helps.

Val Csontos · Answer

@Karen M. Listening to Carollton Sheets tapes back in the 90s got me to the idea to rent the property before I settle. Of course you have to be careful, but here is how i did it many times in the past decade and a half:As part of the negotiation for the purchase of the property, I was allowed to show the place for rent prior to closing, and had a rent agreement ready as well. ( I put a "just in case" clause in the lease, but never had to use it should the purchase would not go thru.) The nice thing about renting the property prior to settlement (lease start date must be the day after your purchase settlement day):You start out with a cash flow boost, because you pay mortgage in the "rear" so you have no mortgage due for 30 days, and the rent is paid to you in advance.If you purchase a property with no money down, than this setup creates a situation where you have a free month of rent at the time of settlement, in other words "you get paid" for purchasing the property. I normally use this "free money" to buy new Fridge or other appliances to make the place more attractive for higher rent.Good Luck!

Jesse Waters · Answer

Karen,Those are some really good questions. I'll try to answer them the best I can based on my first planned property. The first rental we got was due to the housing bubble and having to move to a larger house to grow our family.I work out of town, so, for some of your questions the simple answer is, I cheat. I have a property manager who handles marketing, tenant selection, rent collection, evictions and scheduling minor maintenance.Once we made the offer on our first place we set the closing date in the contract for 30 days out. It ended up being about 60 days because the under writers were being a pain, losing paperwork etc. One property I bought I already knew the mortgage broker, lawyer, inspector's etc and that does make the process smoother. I try to keep using the same people once I find folks that I enjoy working with and that do a good job. Most agents will have folks that they will suggest to you. I have my own, for the most part, and like to use them.Prior to closing we did an inspection, we found a few issues, leaking plumbing, a gas hot water heater that wasn't to code, (not 18 inches off the ground and poorly vented). And a few other items. We went back to the seller and negotiated some of the repairs, he ended up giving us $6,000 at closing to fix everything up. The day after closing my contractor started the repair work, took about a week and a half. The day of closing we put a for rent sign in the yard, and I took care of some minor cosmetic items, mainly cleaning and making the place look better. As for marketing, even though I use a manager I want to know the process in case I ever want to do it on my own. About 1/3 of our leads came from the sign in the yard, most of the rest came from our ad on craigslist. I have properties up the road in a larger city and we use the MLS and some other rental websites to advertise as well as that manager's own site and signs on the high way. We have gotten contact and tenants from each source. I have never had to run a print ad, but those cost us about $60 a week. If you are near a military base use militarybyowner.com, I think its about $50 for a 90 day listing. I do use that on one property.You will definitely learn a lot more if you manager your first property your self, I wish I could, but my work situation doesn't allow for it. I do try to keep up to speed on whats going one, participate in tenant screening, inspections etc.Over all I would say be flexible, have fun, but most importantly analyze your deal carefully before jumping in, just don't get analysis paralysis. Every deal that I have done is different. Some time I rely heavily on my real estate broker, some times I do most of the work, especially if I am familiar with the property. Hope that helps. Jesse