All Forum Posts by: Alecia Loveless

Thank you. I appreciate you thinking about this. 

That makes sense. Slightly more. 

I haven’t had to list anything with a realtor which would be more like a commission of a full months rent. So 1/4 seems fair. 

I’ve been offering a $100 referral fee for existing tenants who refer a new tenant to any of my properties. New tenant must go through complete vetting, sign the lease, pay security deposit and rent, and move in, prior to the referring tenant getting their $100.

I have decided to send a mailer to ALL my existing tenants informing them of this policy as my existing referred tenants have all been exceptional.

Does anyone else do this? Do you feel $100 is enough or should I raise it to $150 or even $200?

I want to make this a valuable thing to my existing tenants.

@Sathya Priya Sampathkumar I’m currently renovating 2 units that are 35 minutes away from me. It’s been a pain going there every day for the past 4 weeks and looking ahead to have to keep going there every day for the next 4 weeks.

I’d recommend a local market if at all possible.

It never occurred to me that I’d have to make the drive to this building for 2 months. I usually visit this property once a week.

If I were you I’d look for a subset of a more expensive market. It will likely be a “commuter” community and will still attract plenty of great tenants. Ideally it should still cash flow solidly but may not appreciate quite as rapidly as the bigger market.

@Jason Baker I attended the University of North Texas in Denton, Tx shortly after high school.

At the time they had a real estate degree (they probably still do). The courses I took during that period in real estate were some of the best and most informative courses I took during my entire college career.

They are probably the only courses I actually have used after graduation.

I think if you want to pursue real estate and can do so in college without a lot of debt that you might learn some really good stuff. I did.

While I don’t regret anything in my life if I was to go back in time I would finish the real estate degree and go into something real estate when I graduated at 22 instead of doing it half-as**ed for years.

I’d easily be $15MM more ahead in my investing career if I’d have focused on that for the 23 years it took me to get really going.

@Jim Vasica Whatever it is I think it’s worth it.

I’ve recently undertaken to paint 3 units, two 2 bedrooms and one 1 bedroom.

It’s about to kill me.

Between working around the renovation materials to the 35 minute commute to the first two units I’m having serious second thoughts about this.

We were extremely hard pressed to find a painter to do this which is why I said I could do it.

I think $3-4,000 would be reasonable for a 3/1. That is online with what we’ve been paying when we were able to find help.

@Cody Ford Without having specific expenses and the 4th rent amount I can’t say for sure if I would pull the trigger on this property.

Initially with the 3 rents it looks like it would be a go for me.

I started out owning a 1908 mansion and a 1890 mansion. The age of the property means little to me.

In my 30 years doing this I’ve found that as long as you address each issue that comes up properly and do the repair needed to bring that part of the building up to current code then you will be fine.

In other words if you do the electrical or plumbing repair right the first time it’s highly unlikely you will need to repeat the same repair again in the future.

The only thing that might give me pause would be if I did not have sufficient capital on a building that was older but had appeared to have significant maintenance issues when I was looking at it to buy.

@Devan Praska I do not have a manual for my tenants but have created a manual for each of my properties in the event that something might happen to me and someone else would have to take over the management of them.

In this manual (which I assume could be modified to provide to tenants) I include all the financing information (which you would not include for tenants) bank accounts, mortgage accounts, payment information, and mortgage payoff), a list of the contractors, what each contractor does, a list of upcoming planned or necessary repairs, and a copy of all leases associated with the property.

When I had my B&Bs we also included local restaurants and attractions in the packet of information which you might want for a STR.

@Estee Capland I recommend trying to stay somewhat local for your first few deals.

I’ve got two buildings that are 35 minutes away from me and I’m currently renovating units at one of these buildings. It is a PITA to have to drive 35 minutes every day to work on these renovations.

I wouldn’t suggest going further than 1 hour away for your first deal. I’ve driven to this property every day for the past 21 days and it’s rapidly becoming an issue. I anticipate I’ll be there for the next 21 days.

It’s also easier to become an expert in your local market which can help give you a competitive advantage.

@Christopher Morris I’ve got close to $3MM under ownership but then I’ve got some debt on it. I “cash flow” about $7,000/month but because I’m not mechanically inclined I source out my maintenance which costs me roughly $4,000 of my cash flow each month. So it’s not technically cash flow.

I’ve got a deal with my contractor where I pay him around $4,000 every 4-6 weeks and he does my plowing, my mowing, and all the maintenance he can do. If I need a sub contractor for anything specific that’s extra.

I work my W-2 part time based upon what I want to work when shifts are available. This ends up supplementing my income about $1,000/month give or take.

I’m making it work and am super happy to be only working part time as I want to.

I’m not sure it’s the best long term investment strategy though because it’s definitely harder to save up for the next down payment this way.

@Jay Chung If the mechanicals for the duplex are in the basement it may be better not to give the tenants access. For insurance you often have to have a certain amount of access to get to furnaces, hot water heaters, and electrical panels.

In my basements tenants have access to they totally disregard the access required and block the pathways needed for access.

In one building the tenants accumulated so much junk over the course of their tenancy that I was forced to get a 40’ roll off dumpster to get it emptied for a sale. And the tenants still lived there, they had just been putting old mattresses, broken furniture, and crud there for years. They then refused to accept responsibility for it.

I just think basement access is generally a bad idea.

But my solution in your case would be to frame out a dividing wall of 2x4s and either drywall or if the basement is prone to taking on water then I’d look for something waterproof as opposed to the drywall. There’s a rigid plastic type material that’s used in dairies and on farms that I’ve seen used.