All Forum Posts by: Albert D.

I'm trying to compile a list for out-of-state landlords who want to self-manage part of the jobs traditionally done by property managers.  For folks who have small-multi-family properties, automation of part of the PM works may save us some money.  Here is my first shot.  Please feel free to add/comment.

1.  Rent collection.  Ask tenants to pay rent online, preferably auto drafted to your account to minimize delay of payment.  

2.  Late payment reminder.  Send automatic text/email to tenants who are behind and charge late fees when passing certain days.

3.  Repair scheduling.  Ask tenants to submit repair requests online and PM or yourself check the requests on daily basis and the prioritize and coordinate the repairs.

4.  Tenant screening.  Require applicants to go 3rd-party site to go through screening.

5.  Showing property online and digital key for showing.  Video tour of vacant property accessible online to potential tenants to save time.  Remotely generated digital key for access to property while using key box as plan B.

Sites/tools to aid automation:

Landlordstation.com:  based on my limited research, this site appears to be an easy solution for #1, 3 and 4.  It charges a fee.  If anyone has used this site, please chime in on pros and cons.

Bhekizwe M. Thanks!

Sam LLoyd Thanks Sam. Good point. Owner has been self manage for years. I need to get some local pm estimates.

Bob Bowling By requiring CM of similar listings in same area from brokers.

John Casmon Market cap rate is below 8% in the area. I'm getting a good deal by any count, either the current 13% or my over penalized 9%, unless I'm missing something here. Value add: face lifting improvements and rate increase by 3-5% per year.

Thanks Jeff Greenberg I got tenants roll already and some of them have been there for years with security deposits and everything. Seller will provide actual leases from tenants within days after signing before inspection expires. I feel comfortable with the rental income level with these proofs. Estoppel will provide another layer of protection and hopefully aid refinancing down the road and seller only willing to provide when deal is real.

Thanks John. Cap rate is 13% under current owner. If adding 10% vacancy and assuming 50% Ops expenses, cap rate is 9%. Under current owner, Ops exp is only 25%. I think the over conservative 9% gives me a comfort level to move forward. Capex assumed at 5% and not included in the 50% but as additional investment.

Feel excited and nervous at the same time.  Never in the multi business before.  Any comments/advice on what to watch out for are welcome.  Many thanks in advance.

Here are some details:

10%+ cap rate based on 2015 actuals; 

Or 9% cap rate using a quick & dirty analysis (rules of thumb: 10% vacancy & 50% ops expenses)

Currently 100% rented, seller to provide tenants Estoppel at close and actual leases after LOI signed

100% cash deal; no financing contingency

Property sells "as is" with right of inspection (contingency)

Property managed by current owner for 10+ years; new PM will be needed as I'm out-of-state investor

I call it luck and perfect timing. It was my first investment in RE. Back in 2011, pretty much the bottom of RE market, we bought a condo in Seattle. Never set our feet to it, bought through a long-time friend who lives there. We rented it for five years with slightly positive cash flow. This year, HOA passed a special assessment in huge amount. I decided to sell it and found out by surprise - the value doubled! Guess that's the icing on the cream people were talking about.

Lessons learned:

Timing is everything.  You buy it right, the rest will follow.

Trusted local support is KEY: we never even physically saw the property over the entire investment period.  We have friends who we had great relationship with since high school to oversee rental and repair.  We have outstanding local realtor advised us on market, location and pricing.  Because of the trust, the cost of doing business is very low.  We don't have to second guess if the repair is really needed or if the re-model cost is reasonable.  We gave our local help high trust and high authority so we live care free.  :)

HOA/PM can be a pain in the neck, esp. for run-down property. We had high turnover of management companies for the entire campus of condo buildings. None really took care of the property, not even basic maintenance. We only found this out too late, when our roof started leaking! Special assessment is expensive to get things in order. Even if I voted against, I was dragged along as it passed a certain threshold. Professional level of PMs can vary. Good luck to get a good one.

Learned a lot from BP.  Just wanted to give something back by sharing my first investment.  More to come...stay tuned.  :)

I'm seeking investment opportunities in large cabins (5 BR+, 5,000 SQF plus) in Gatlinburg, TN.  If anyone has a great deal, please feel free to send my way via pm.  Leads also appreciated.