All Forum Posts by: Nat C.

Good parenting!

May we know more details about the property- location, purchase price, rehab needed, rental comps, ROI?

I just wanted to ask for some honest opinions.

I have a property manager for a duplex. Recently I received a letter from the water company that that there had been illegal tampering of the water meter at the property (by the tenants) and I had to pay a $500 fine. It gave me the option to appeal by 20 August although I didn't receive the letter until after this date due to mail redirections.

I spoke to my PM and he said he can be of no assistance and it has nothing to do with him.

I said to him 'Aren't you responsible for managing the tenants, including their illegal activity?'. His answer was no, he was not responsible and it's all in my hands.

I have just written to the water department to ask for an appeal hearing even though it's after the deadline. Should the PM be assisting with this issue or is his evading responsibility a fair call?

 Thanks for the heads up!

Ashamedly, I didn't even know what a REIA was. I do now and I just found my local one so will be going to the next meeting. Thanks everyone.

 J Scott, ideally I'd like to be an unpaid personal assistant to a property developer/real estate investor. I would love to be a bird-dog and drive around looking for unlisted properties and development opportunities. Obviously I wouldn't be asking for any commissions. I worked as a personal assistant in a previous life so I'm experienced to undertake a variety of duties. The best way to learn is on the job and I think it would be a win-win situation. 

Does anyone know where or how to find a mentor? I've heard of investors whose lives have been changed by relationships and mentors they've had.

Personally the help I've had from the people on bigger pockets has been a huge assistance.

I am young(ish) and although I have 7 years experience in real estate investing, I've really just been winging it. It would be my dream to have a pro who has been very successful 'take me under their wing'. 

I am working on some really big projects right now and frankly it's scary as I don't know if I'm doing things right or wrong. I would really prefer someone in my own market (Miami) as it's quite a unique investment market.

It's not exactly something you can find on craigslist though, is it.

 Yes this is exactly right. You can achieve ROIs that are extremely high in low socioeconomic areas (better known as the hood). But be prepared to work for your money. If you live nearby and can actively mange it or you have a really hardworking property manager then it can work.

These properties also generally provide lower capital growth. A conglomerate of lower income housing will only go up so much in value. Very rarely do these areas undergo huge market appreciations like you see in other areas. So you have to consider whether you would prefer the highly monthly income and more work or the property which is going to make you a lot of money in the future when you sell it for a sweet profit.

My highest net return property I have is a duplex I bought for 32K, did 1K of fixing and it's rented for $850 a month. The taxes are also really low so the ROI is nearly 28%. The tenants are OK but one is a raving alcoholic and his drunken, ranting phone calls are cumbersome.

When buying a property, I usually calculate that it should be around 20% return AND not in a hood. These deals can be hard to find. I won't buy if it's under 15%. Now this is all theoretical because once you buy the property there are ALWAYS going to be unforeseen expenses that you couldn't have factored in. Some people do factor in a certain amount extra for vacancy and above average repairs when calculating ROI projections. Adding in an extra 'fudge factor' deduction seems like a sensible idea.

I'm all for DIY and I have no qualms being 6 ft down digging a trench. This job requires permits and approval from the city though. They are breathing down my neck on a daily basis. I keep telling the city official that he's awesome, doing such a great job and how thankful I am for his 'assistance'. I don't think he would be receiving many commendations from people and it seemed like a better approach than being abrasive. 

I told them I've set up a 3 monthly 'jetting program' (which I have) and they said that's not acceptable. I said that I do not have $20,000 to replace the line, so want do they want me to do? I'm still awaiting their response.

I'm going to sell the building, not purely because of the recent problems but I was already planning to as I need the money for other projects. Obviously the buyer will be given full disclosure about the problems.

I've spoken to 5 different realtors so far who've told me I'll still recoup what I paid, so hopefully all will end well.

Once again thank you to everyone who came forward with the great advice and suggestions.

The ideas on different methods of attaining lower bids has been useful. My feeling is that this building is not worth the costly repairs. If I can get away with jetting it every time there is a sewage back up, then that is what I will do.

It seems like the Health Department is trying to force me to undertake the work to replace the line but I don't see how they can do that if someone doesn't have the funds available.

On another note, I had to pay for extensive clean up of both my property and surrounding properties where there was sewage overrun. There were a strict list of guidelines on how things were to be done. I called a bunch of companies who specialize in hazardous clean up and was shocked by the quotes. These were the bids- $8500, $6500, $4800, $1800, $1000.

Yes I went with the lowest bid. One of the ground floor tenants is amazing and great with communication. I'm going to tell her at the first sign of sewage back up to call me and the plumbing company immediately. I do not want to pay $1000 again.

Finally, if I legally pursued everyone who blatantly stole money from me or ripped me off in some way (builders, handymen, property managers), I would well and truly be up for over $50,000 in re-reimbursements. I am slowly working through the list.

 Michaela, funny that you mention that. I was just talking to the plumber who did the jetting today and he told me to tell the tenants not to flush any disposable wipes. He said whoever invented them wasn't a plumber as the things don't go through the pipes properly and get caught on any rust pieces and stay there. I'm thinking that the person who invented them WAS a plumber. What a great trick to keep plumbers in business.

I have called all the tenants not to flush anything down the toilets including toilet paper. I asked them to put the toilet paper in a rubbish bin in the bathroom instead. I lived in Asia for years and that's normal practice there.