All Forum Posts by: Richard F.

A caveat about the "public" MLS sites...

In my experience, the public data is updated infrequently...perhaps only weekly by some Boards, while the agent access is usually "real time". In other words, you will likely miss out on the hottest deals by relying on the public site.

Ummm....

The "other" side of the island... :lol:

Unless you have explicitly signed a "Buyer's Agency" agreement, it is likely (depending on what state you are talking about, and assuming that Melody is actually licensed) they all "work" for the seller.

Actually, as always, it depends on local laws for the property location. MOST states real estate licensing laws are based on Seller's Agency, where as REI pointed out, both agents technically work for the seller unless there is a specific buyer's agency agreement in place. If I remember correctly (sorry, offhand I'm not sure where to find the stats) there are six or seven states that are BUYER agency states. For example, my previous license was in Nebraska, where, in essence, the Listing AGENT was the seller's agent, while any other agent, generally including within the same office, was automatically working for the Buyers. (There were some fine points to this which are a little vague now, but it is pretty accurate)

Also, in my experience, a Standard Purchase Agreement (or whatever your local RE board calls it) has a section that spells out who is the CLIENT, and who is a CUSTOMER. The difference being fiduciary duty is owed to Clients, while the duty to Customers is little more than simple fairness and honesty limited to non-privileged information from their client.

My (biased, yet sound) suggestion is to find a Property Manager that you are comfortable with, let him know up front what your long range plans are (hopefully you will try his services at some point) and work with him as a Buyer's Agent. He will be able to advise you on the pluses and minuses of your POTENTIAL investment before you spend a dime, and give you realistic operating Pro-Formas based on the local market to help you decide "What's a deal?". Build a relationship over time, and you will be able to negotiate a somewhat lower commission, and receive invaluable information that a typical SALES agent will not have a clue about.

Sure, I'm a member of Hawaii Association of Realtors, and as such have full access.

REI asked, so here goes...

I have used primarily Yardi over the years, with several companies, it seems to be a market leader for midsized companies. This is code-driven, meaning you do data entry by first inputting the property code, or vendor code, or tenant code, or... all numeric, and to me, counter-intuitive. The input format is rigid, the reports are rigid, all in the name of being bulletproof from an accounting standpoint. Obviously this is important, but I find it very cumbersome.

At one time I worked with a company that transitioned from Yardi to Spectra for Windows. Now this program was very promising, as it was based on MS Access, which would allow for a great deal of easy customization and further manipulation of data from external programs (Word, Excel, etc). This is not reasonably duplicated from Yardi.

Fundamentally, there are two types of data in property management...financial and non-financial. You NEED quick easy input methods, and easy access to the data once its there. Yes, the financial data is mission critical and must be secure, auditable, and accurate, but the non-financial data is more important to daily operations. There is so much repetitive document creation, the opportunity for errors is huge. By fully utilizing a relational database, you can virtually eliminate those errors, and gain better insight to all aspects of operations.

Personally, I have abandoned MS completely, and believe that Open Source is the small businessman's Best Friend, but that's another topic all together.

The basic process is pretty straightforward, actually developing the "correct" value is an art.

The MLS collects a great deal of data on each listing. This data is typically input directly by the listing agent or an assistant, which leaves some question as to accuracy on occasion.

In any event, when performing a comp, you simply select properties that closely match the subject in terms of size, neighborhood, amenities, land area, etc. based on the fields available on that MLS. Of course, rarely do you actually have identical structures, and you always have to compare locations, time frame, and many other variables. This is where the "art" comes in...

The next step is adjusting the value up or down based on the differences between properties. This will vary by locale, market conditions, and other factors, and requires a great deal of experience to develop accurate numbers. Things like an extra bedroom, or a dishwasher, or a corner lot, or an extra parking stall, ALL have value that can be added or subtracted to arrive at your final figure. The MLS is "just" a big database of current and historical information that you need to learn how to mine for the nuggets you desire.

Although it is my belief that many MLS utilize the same software, I have no facts on that. The systems I have used do have a pretty easy to use interface that will get you the raw data. Interpreting it accurately is a learned process.

Hope that helps...

A little dose of reality for those anxious to "get into the game".

As a licensed Property Manager for about 12 years, averaging 500 units managed, in spite of best efforts there has been occasion to encounter a less than desirable tenant. Here's a few Classics:

SFH, average neighborhood, tenants had been there for at least five years, always paid on time, in cash, at our office. Neighbor called regarding "strong odor". NEWBIES NOTE: This is NEVER a good sign! Upon investigation, found tenants disposed of all trash in their basement. It was literally three feet deep throughout with rotting food etc. The tenants were reported to adult protective services and removed, and the owner had a BIG cleanup bill which of course included gutting the house...

Apartment house, an older "conversion" (big old mansion, later partitioned off into smaller apartments) in a lower rent area, but not slums. Again, neighbors complained about "strong odor". I will add that this was in the hot summer in the midwest. Let me be polite and just say it was indeed a deceased individual. The subject apartment had to be gutted, as did part of the apartment below due to "fluids transfer".

On a lighter note, how about tenant screening? Another post was discussing that topic--here's something to consider, and this just happened about 8 months ago: Luxury home- $4500 per mo rent, gated oceanfront community. I show the property to an individual that, while somewhat eccentric, seemed "normal" (whatever that is!), and upon review of the application, was what I refer to as "Golden". Or so I thought! The credit score was very high, no derogs, and in fact this 40ish adult was a Trust Fund Baby, with huge assets. Glowing letters of reference from previous LLs. While preparing the lease, I am informed a service dog will be part of the package, and provided a doctors letter. I'm not happy, but its all legit, and I'm not worried about collecting for damages.

Well, once the tenant slipped off of her meds, she turns the whole neighborhood upside down, digs up new landscaping, lights and tv on full blast at all hours, has the police out at all hours because she is being stalked, and on and on and on....

Thankfully, it is my policy to only offer a six month initial lease, but it sure seemed like a long six months!

I've got lots more...but lets hear some of yours!

To each his own, but if I were to spend days waiting for checks to clear before moving in a new tenant, I would have a lot of unhappy owners. In addition, on at least two past occasions, "cleared" checks were later rescinded by the bank.

I require a minimal application fee of $10 per adult occupant to be submitted with the completed application in cash or a money order before I will process the application. Once approved, I require the full security deposit within 1 business day, in cash or MO. The unit remains "available" until the deposit is paid (in other words, I continue to show and accept backup applications, although I do not process them until the first applicants deadline passes. I also refund application fees if they are not processed). Once the deposit is paid, they have 7 - 10 days to pay the pro-rated rent and schedule the move-in inspection. They do not move in until all money is paid, in cash or certified/money order.

Your market may vary, but the reality is that nearly three fourths of applicants want possession immediately, so waiting for checks to clear is not a reasonable option for them, and it's dangerous for you. Cash is cash, but a tenant that "promises" to make good is STILL a tenant, and now you are subject to all applicable Landlord/Tenant laws, including the typically lengthy and costly eviction process. Believe me, there are "professional" deadbeats that know how the system works, and will move in for nothing, play you, and end up with six months of free living. Getting good funds up front will not save you from every deadbeat, but its a great start.

In regards to tenant screening, it is important to have a written policy, but it should not be overly detailed. And again, the reality is that people have issues. In order to select a tenant, it is generally more important to look for REPEATED issues, rather than saying their credit score must be above 700, or whatever... You need to study the whole application, see if all the pieces fit together and make sense. Do their previous addresses in the credit report match with what they show on the application? Dates? If not, Why? What about their prior landlord-is it a verifiable company or an individual? Does that individual actually OWN the property? Or is it their sister-in-law? How about the employer? Did you call the phone number provided by applicant, or did you call the company's listed phone number to reach a manager? And just what DO you do if the Social Security number is reported as "deceased"?

As REI said, check your local laws. Or, more specifically, your building codes, zoning information, and landlord tenant laws. Possibly health dept. regulations. In many locales the number of occupants is determined by the total number of square feet in the unit, and they only "count" certain rooms. And the rooms must have a minimum ceiling height. And in addition, it is not uncommon to have a requirement, for example, that a "bedroom" consists of a minimum of 100 sf, plus it must have a closet. And some locales, as well as certain privatized military housing, have complicated formulas regarding the ages/sex of minors that can share the same bedroom with other minors and/or adults.