Benefits of Investing in Tenant Occupied Properties

So, you're an investor and "problem properties" pricing is attractive, but let's be honest, you don't live here, don't know anyone and despite a phone call, photos or even a face to face meeting you can't trust every business. There are several people involved when purchasing an investment and the key people whom you're going to want to know for sure is your Realtor and Property Manager. In most cases if you find these two people and they're legit everything else will fall into place. So, let's talk about investing in tenant occupied properties.

The first benefit of investing in tenant occupied properties is that if someone lives there most likely there are not any life-threatening issues. The plumbing is probably intact, walls, doors and floors are there, and the kitchen is operational. So, the inside checks out. If there are no foundation issues and the tenant is current, you've passed phase 1 of the preliminary checklist. Now on to phase 2. Phase 2 involves some skin in the game, you will most likely physically see the property with your own 2 eyes or if you have a relationship with someone you trust you can have them provide video, photos and documentation. Out of my hundred or so deals about 60-70% were done digitally. This means I never met the investor in person. One of my major clients had many properties and I only met him once. He orchestrated everything from behind the scenes and come to think of it ALL of his partners on the ground were Black. It makes sense to employ the people nearby to handle problems as they arise so happy wife, happy life is really happy tenant, happy life. If you're a new investor spend the $400 or less for a full property inspection. This will give you all the details you need and is the best money spent, plus you're dealing with a neutral person who is licensed and governed by law to accurately proclaim property issues and defects. Once you've passed inspection on to phase 3.

By the time you reach phase 3 if there are no surprises you should be cross checking title work, reviewing rent rolls, organizing funds and preparing to close. I have often found that tenants sometimes get emotional when a property changes ownership. So in all honesty if you can do this as quiet as possible that is best. If the property is already under management, let the property manager set up the inspection with the tenant, you can have your Realtor attend inspection as an extra set of eyes. In the case management changes, it's just like a relationship you want to befriend the tenant in some way, listen to their concerns and repair what's needed. If you have money to invest in property you probably don't deal with a leaky faucet, spend the $100 quickly and get this resolved and you'll have a tenant for life! Let's talk about after closing, if management doesn't change there's not much for you to do, but if it does or if you self-manage, consider convenience payment options like QuickBooks Online Payments and get a local handyman or GC contact information. In most cases a good handyman will do especially if you're not doing major repairs.

Looking forward to closing deals with you in the near future. Happy investing!