All Forum Posts by: Kevin Wright

Hi NYC neighbors and out of area investors: 

I'm wanting to know how many of you have chosen to use a hired manager for your long term hold rentals.  

For those of you who do, are you happy with your current management, and if so, what are the main things you feel they do to create value for you? 


For those of you who don't, why do you prefer to self manage? (What aspect steers you away from using a professional manager?)

-kevin 

Hey @Carlo D., speaking for our NYC market where we can only legally hold a total of one month in deposits (only security, no last month rent) I've seen that tenants will leave when they want to leave, knowing that courts will almost never side with the landlord or enforce provisions of a longer residential lease.  My company manages a number of rentals, and the best thing we have found is to 1) start with well qualified tenants 2) have good open lines of communication with those tenants, and 3) plan ahead so that when it is time for tenants to finally leave arrangements can be made to turnover and re-rent the space without necessarily needing to have more than a few days of vacancy.  

@Jowel Pyle I think what you're asking for is a resource to ballpark the cost of what you see being needed, without relying on a contractor who may quote a price and then come back asking for change orders and up-charges after the first surprise is found behind a wall, etc.. 

Check out Marshall Valuation Services and their online component cost estimators. We use this in the appraisal world. It is broken down by component costs taken from a survey of real world data and adjusted for time, location, etc.. There can be a learning curve as with any software platform but it can help you ballpark the cost of what you believe is needed in a property, then you can add your margin and contingency before backing into your offer price.  

Hey @Carlo D.! 

I would give Chris Majcher at Greenpoint Insurance a call. He's a very knowledgeable and personable insurance broker, and we use him to find the best insurance fit for all of our managed properties here in Brooklyn. 

From my perspective: 

1) Landlord insurance protects against most types of liability in the even of a tenant wanting to sue you, but it can never be sure to cover all liabilities. This is why the property is best held in an LLC to begin with.

2) The policies should be in the LLC's name, but you can add any number of additional named insured parties, including yourself, maybe a manager, and anyone else who is involved, in order for those entities to be protected by the coverage.

A personal umbrella is always a good idea when right-sized and reasonably priced.  

-Kevin 

Hi Fiz! This is a great question, and it's something that I find very relevant in my market (NYC). I think the name of the game is pricing in the total cost of ownership. Create your cash flow model and make sure that the higher HOA fees are priced in to your offer such that it would be on par with a similar property bearing lower HOA fee burden. Another thing to consider is that if these are temporary such as in the case of a capital assessment, find the present value of these increased costs and make sure that is deducted from the price of a similar asset in your valuation math.

Hi @Chris, I'll echo what Mohammed and Abel have said here and add that part of it is the story of a yield curve, similar to all other types of financial markets in terms of risk/reward.  Typical returns can be lower here due to high asset prices going-in, but asset prices are high because there is less of a risk premium baked into the valuations - ie. everyone knows that NYC is one of the most resilient and consistently performing markets year after year, so they're willing to pay a bit more and accept a bit less fundamental return on their money.  

Hi Jose, I would recommend talking to the broker that we use for all of our managed properties here in NYC, Chris Majcher at Greenpoint Insurance. I would add contact info for him but the forum won't allow.

He is by far the best connected insurance broker I've worked with. Worth reaching out.

-Kevin

Wright Realty Group

Brokerage | Appraisal | Management

Hi Chichi, I would recommend talking to the broker that we use for all of our managed properties here in Brooklyn, Chris Majcher at Greenpoint Insurance. I would add contact info for him but the forum won't allow. 

He is by far the best connected insurance broker I've worked with.  Worth reaching out. 

-Kevin 

Wright Realty Group

Brokerage | Appraisal | Management

Hey Patrick, if it's on the market I could represent you as your buyer's agent and give you a cash-back credit from the commission! Would that help?