All Forum Posts by: Account Closed

Controlling maintenance & ensuring quality tenants makes or breaks the investment.  

If you are uncomfortable with the "house maintenance" pm you talked to then I would think going with a younger property and/or focusing on preventative maintenance.  

At my company our "in-house" mechanical team conducts our bi-annual inspections.  This ensures the A/C lines get flushed, filters are changed, plumbing lines are tight, etc.  Also gives us a sneak peek at the living condition of the tenant which helps us determine if they are as good as they were on paper!

If you are uncomfortable with the pm's in an area I would avoid it.  

Not sure of any resources but here's my take as an active property manager.

Lower end properties are famous for higher rewards but are infamous for higher risks!  

You've got to have a maintenance plan and think sustainability for every repair.  Most of the time the labor costs are the same and you may pay 10% to 50% more for the materials but atleast you only have to pay for the labor once this way.

Make sure your property manager is reputable and go over their qualification process. Make sure they identify a target market. Many times on lower end properties I advise my clients to offer under-market rents so they can therefore have a better opportunity to "cherry pick" from more applicants. A cost of $50 per month or $600 per year in lower GRI can save thousands in repair costs not to mention keeping the living situation much safer for all tenants in the building. Other incentives can also work like first month free, reduce deposit, etc. One bad tenant will cost you your good ones!

We do bi-annual inspections on all of our properties.  Quarterly would even be better for low end  This is a great time to make sure A/C filters are changed, drain lines are cleared, waterlines are tight, (asset protection) and to get a peek at how much self-respect the tenant has....If they don't respect self, they won't respect you.  Get em outa there!!!!

Forest green on the siding and an off-white on the trim & shutters.  The front porch needs a light fixture & that stump has gotta go!

Make sure you get good references on the management company!!!!

Find out the age of all your major potential repair hazards.  Roof, A/C, etc.  Get a reputable home inspector to check out plumbing and electrical service lines.  Significantly reduce the possibility of having to put unexpected large sums of money into the property!

Additionally, there are new standards in energy efficiency that will be becoming more relevant when it comes to disposing the property in the future, and may impact your future rent-ability.  This is a subject that is on the back burner now but the new code requirements will be making many existing properties less desirable to own or rent without significant modifications.

Great answer Steve!

Hi all,

This has been a serious question of mine for a long time. I know land-banking has been an iinvestment tool for big investors for a long time. I've done a few little deals here and there for small investors with success. Any recommendations on how to market large-scale opportunities to large-scale land bankers?

Thanks in advance!

Buy a fix-up duplex. Live in one side, rent out the other, cover your note, and park your lambo in the driveway. :-)

Then watch out for other impacts. ...Including those within your neighborhood from people interested in how you ended up so young, living in a duplex, with a lambo parked in the drive. And then you may even end up on the FBI watchlist. You'll definitelty be on the watchlist of undesirables who know where you live and want what you got....Atleast for a ride. You don't need that kind of spotlight until you are ready to handle it. As the saying goes...Be careful what you wish for.

It's nice to have dreams, but if you don't earn the results and extend yourself....."You never know what you're gonna get".

I do propertty management and here are a couple of tips I hope you can use.

Always perform a walk-through with the tenant and have them sign off on the condition of the property before you hand over the keys. Cover everything! In poor property management service areas this is commonly overlooked and can separate you as a professinal in your area.

Always think long term with tenants. Come up with ways to promote longer term leases. IE: Less security deposit for 2 year leases has worked well. Still CYA with condition report signed by tenant.

If the parents are covering rent I focus on credit. If the occupant is on their own with rent I focus on rental history, criminal background, and employment tenure...Not credit.

It can lead to longer term net gains by renting at or even just below market rents to have best results in acquiring most qualified tenants. With below market rents you will be in highest demand, less vacancy, less destructive tenants willing to sign longer term leases. One month of vacancy at $1,000 loss to owner, or two months, makes it cost effective to market at $50.00 less than competition. Once you have a lease in place you can re-market at market without as much risk to vacancy.

In multi-level buildings I like to run specials for single residents top floor, couples middle floor, and I keep familes on bottom floor, if possible. Cuts down on ceiling noise and just sharing the idea will reflect well on potential tenant perception of you as a landlord. Focusing on single tenants also reduces parking issues.

I always write on leases that tenants will be responsible for the first $20 of repairs. I tell them not to worry about this as we will not charge them if something mechanically goes wrong and isn't due to their neglect. This little statement on their lease helps them realize the importance of trying to trouble-shoot an issue on their own before they contact you. My "Call-Reducer".

Hope this helps.

Good Luck!

Thanks Jon,

Texas may be a play as I've heard that they are in the development process with high expectations of long term growth consistent with Ryan Young's comment. I've heard some rumors about building so called "man-tels" where the oil and gas companies will lease them out long-term at incredible rates. So long as there are adequate services providing full room and board connected to these facilities.

Some of my green technology guys are talking about these types of opportunities.

Thanks for the replies everyone.

I'm looking for the epicenters of activity in these economically emerging areas. Sounds like the San Antonio area would make the most sense for me to investigate. It's within a reasonable driving distance. Does anybody have some more specific insights on the current market conditions there?