All Forum Posts by: Alex Stewart

You absolutely want to represent yourself as the PM. It provides more legitmacy to your operation and makes the tough conversations easier since you are simply the "messenger". I can't tell you how many times I have denied a tenant from being able to paint their walls pink because "the owner does not allow for that type of modification". 

I have my folks use the Behr Premium Plus Ultra. It goes on smooth and I can get 5 gallons for around $120. You don't want to go too cheap on your paint or it will look awful and take tons of extra time because of the need for additional coats.

I would say in a place like you are describing, it won't have much of an impact. I have units that only have showers and they rent no slower than similar ones with a bathtub. It may be a turn off in a larger home where folks want to be able to spread out and therefore have different amenity expectations, but in a smaller apartment, I would doubt it would matter.

I am never a fan of buying rentals with a tenant, but when I do, I immediately "bake in" the cost of an eviction to be conservative. In this instance, you need to use this opportunity to establish that you are the new landlord and these are your expectations, no exceptions. It never pays off as a landlord to not be explicitly clear and firm on your expectations. This means you need to get a written lease, appropriate rent, etc. 

Will they leave? Possibly. But it's better to get a good tenant in there that will play by the rules in the long run financially.

Kurt,

We currently operate in a climate that will fetch excellent values for those looking to "cash out" in real estate. Unless you have a particular passion for this business, I would recommend for you to sell and allocate your inheritance towards investments you are more familiar with and ones that are a bit closer to you. That may seem harsh, which was not the intention. Managing rentals on opposite sides of the country is a tricky proposition and you might be better served with another investment class. You will get top dollar these days for investment properties.

I am a big fan of http://www.american-apartment-owners-association.o...

I do lots of applications though, so it might not be cost effective with only one rental unit since there is an annual fee.

There are a lot of moving parts there, so I will try to address them the best I can. 

First, being an investor in Columbus Ohio, I can tell you that we certainly have excellent cash flow here compared to California. I would imagine it would be much more cost-effective to invest in another market rather than uprooting and moving. 

Another reason you may want to identify an out-of-state investing partner is because although you move, you still won't understand the market. I can tell you first hand, that my returns are dramatically higher because of the fact not only is this a great market, I also understand it like the back of my hand because I grew up here. 

So in a nutshell, I think you need to find a trusted partner that can help you deploy your capital and perhaps show you the ropes in a more economically viable market.

I personally would do the HELOC. Interest rates aren't going to do anything dramatically quickly, so even though your HELOC has a variable rate it shouldn't burn you. In addition, unless you have a deal lined up that will lock up your money indefinitely (Buy-and-Hold), a HELOC allows you to probably pay less in interest because it will only be partially utilized at any given time. Additionally, you will save money in the long run on financing costs because you won't have to take out a fresh loan every time you do a new deal.

I'm not sure of some of the other financial metrics in your situation but I think you may need to find a new HVAC Provider. I have a relationship locally with an HVAC technician who gets me gently used furnaces installed for under $800 and AC Units installed for under $700. Being able to keep the HVAC costs under control is HUGE as I am sure you know in Buy-and-Hold.

The key is to invest in areas you know. Did you grow up in Columbus by chance? If so, the best Columbus investors I've seen invest in the areas they grew up because they know and understand them incredibly well. Columbus is a market that gives a great advantage to one's ability to know a good deal when you see it.