All Forum Posts by: Adam P

Misspost

I have not implemented any such policy, but am interested as I grow, whether tenant analytics to manage the business is legal.

If a landlord has meticulous records, you can also record the total maintenance cost per apartment (logging all calls, rent payment dates, etc).  If you get to the point of owning hundreds of units, is it legal, that any rent raises are also influenced by cost of owning the unit.

I have been renting for 17 years myself, and have never had a private landlord raise my rent.  Now that I am an investor, I see why, I have always paid rent on time, don't annoy neighbors, and only reach out to my landlord for real issues.

I have however lived in corporate owned large apartment buildings, where I got hit with huge rent increases at lease end.  I then move solely due to the rent raise.  As a landlord, I would prefer not to lose an A+ tenant due to blind rent raises if I can legally implement such a strategy.

Are there any laws defining rent rise discrimination for non-protected classes?

I am growing rapidly, and trying to develop lease renewal strategy.  As all landlords learn after a while, not all tenants are created equal.  Some pay rent early every month, rarely complain, and are very low maintenance.   Others pay on the 5th every month, and call to complain about anything they perceive to be wrong about an apartment.

If I am doing renewals, are there any laws stopping me pricing rents around the maintenance cost of a tenant?   Many tenants are not bad enough to kick out or not renew on, but still cost me more than other tenants.  I would prefer to ultimately build the business around extracting maximum rent from higher maintenance tenants, and less rent from low maintenance tenants within the same buildings.

At this stage, say I have 2 tenants that started renting at $1000 on a 12 month lease.  At renewal time, if I offer 1 tenant a renewal at $990 per month, since to me they are pure profit, but offer the other tenant a 12 month lease at $1100 per month, to cover the $100 of my time I waste on them, could I be sued for discrimination?

Obviously get rid of the car and pay off the car debt.  Buy a 10 year old Japanese car for $2k.  It will work, be cheap to maintain, and then set as a goal, once you hit $250k in net worth, you will buy the $25k car again.  If you feel cars are important to you, and you have access to a dealer, buy a 3 year old car from a dealer auction, then after a year sell it on craigslist, and repeat the process.  You can drive a 3 year old car forever for free using this strategy.

Focus on your dayjob income.  It is tough to really get ahead earning $35k a year.  Start driving for uber, or doing any other side hustles you can thing of to get your income over $80k.  Save like crazy, make sure you always have 6 months worth of living expenses in the bank over and above your investments.  This will allow you to be lower stress, and perform better in your day job and investing career.   Don't invest until you have the 6 month buffer.  Otherwise 1 boiler or roof could ruin you.

Then start investing in property.  House hacking is a great way to start.  Then with savings, once you have enough buy another multifamily, and then another.  Before you know it, you will be a successful real estate investor.

At your age, I would also consider travel.  Take 6 months out in South America or Asia, and will change your perspective on everything, and likely make you better at your day job, especially sales.

 Interestingly, I have been a landlord for 5 years, and have never had 2 qualified tenants apply at exactly the same time.  I provide applications at showing, and let people fax or email the application to me with their details.  I typically process applicants within hours, so see if they qualify.  I sometimes wonder if people that are getting flooded with applicants are pricing their rentals a little low for the market.

If you were to get 2 identical applicants at the same time, and chose 1.  I would be honest in my response.  Tell the declined applicant you received 2 highly qualified applicants at the same time, and the other applicant received the apartment.  Do not ever do this if 1 applicant clearly applied first, and the other seems like an upgrade.  Either an applicant meets my criteria, or they don't.  Due to never getting 2 applications at exactly the same time, I have never had to reject an applicant that met my criteria.

Yes, always shadow contractors until you build a level of trust.  

I have found many contractors will be really great at certain areas, but pretend to know others.  When you first hire someone, until you build that level of trust that you know they will only quote you on work they know how to complete well, always youtube to teach yourself, and ensure they are completing the job correctly.

ie, on my first project, I have hired someone to complete a bathroom, and they started putting regular drywall up in the bath/shower to be tiled over.   I spent 15 minutes learning online about tile backer board and waterproofing, so I caught the issue right away, was able to fire them, and hire contractors to complete the job correctly.   If I had let them be, I would have had a mold nightmare in no time.

I have tenants with tattoos, however if I had 2 identical tenants who applied at exactly the same time, one with, and one without tattoos, I would probably take the tenant without tattoos.  I always take the first qualified tenant who applies, so thus far I haven't run into this situation.

There are more tattoos in the jailhouse than the penthouse.  Many professions still discriminate against tattoos, and that can limit a tenants employment opportunities.   

I have spent the last 17 years working in the corporate world as my day job, working with thousands of colleagues over that time, and I have never worked with a single person who had a tattoo visible at work.  So that is 1 area where a tenant with tattoos just shut off their opportunity.  

I hire a lot of construction guys on my rehabs, and there are tattoos all over some of the hardest working, most honest people you will ever meet.  Visible tattoos don't make someone a bad person, but do limit their potential employment opportunities.

I do the 2 showings per week (usually 1 weekend mid day, and a Tuesday or Wednesday evening).

I put in a lot of pictures and all details in the advertisement, including the showing times.  I find about 1 in 3 people who contact me will actually turn up.  Most people equally do not read the advertisement, and call/email/text asking questions that are already answered.  

I have been finding (not sure if it is coincidence or not), that most of my renters have come through on their own (turn up 10 minutes early, or a little late).  Some people when they see a crowd, don't bother to put in an application.

For my next opening, I am considering how to balance not wasting my time, and splitting up people who view the apartment, so valid renters don't get scared off.  Perhaps making appointments in 5 minute increments, rather than an open half hour.

Really need more information.  I personally prefer cash flow, however if you are buying a $650k property for $500k at break even cashflow, that is local.  It could be worthwhile.

However if you are buying a $500k property for $500k with no cashflow, you are gambling.  You may win big,  but you may not.

 Can you share the location in Chicago each of above flips were?