All Forum Posts by: Becky C.

This year we sold our only rental property (thanks to those who advised me on that topic) and sold our own home to move into a different one. Now we're sitting on some cash and would like to reinvest in a new rental. I'm north of Boston in Massachusetts which is a very competitive market, and am open to single families, multis, or condos that I can rent for more than the mortgage for a 15 year loan. I really wanted to do fix and flips or BRRR strategy (depending on exit conditions after updates), but the agent I'm working with seems pretty skeptical on it. People keep telling me that around here that is really for "developers" and I guess I don't rate yet (though I'd like to someday :))

The problem is the market is so hot up here, it seems like the only way I can find a deal that supports my goals is with fixing up more distressed properties that haven't sold right away, so I'm struggling with the best way to use my available capital. Say we have around $100k to put in, we could put 25% down (standard around here for a conventional mortgage on second/investment home) on either 1 $400k home, 2 $200k condos, or 1 less expensive place needing repairs (putting some of our capital against renovation).

I just saw an 1846 built victorian that was "codexed" into two separate units, on a 12,000 sqft lot which used to have a barn structure, and the agent suggested the best value for the property is a flip with the addition of resurrecting that structure (with approvals - this is a historic district) and turn it into two more condos in the back of the lot. The house is totally overpriced, and needs extensive extensive renovation as one unit is basically poorly gutted with a lot of non permitted work, and the other is just a mess. So needless to say, both (unit 1: 4 beds 1 bath 2000 sqft, unit 2: 2 beds 1 bath 1000 sqft) need to be gutted for a price much higher than I have the capital to fund.

My hope on this specific condex was that I could rent the first unit (questionable if it is "liveable" though it is owner occupied now - he's in preforeclosure) to cover the mortgage, while fixing the back unit. However after my showing I think its a much bigger project than I anticipated and likely wouldn't qualify for traditional financing, so wanted to ask the community about how larger developers are turning these big old houses into multiple condos all over Boston. Its happening a lot around here, so I assume people are making good money doing it. I'm not afraid of a big project (though my agent is), I just don't know where to start or how to finance - or if I really should just run away like my agent concluded.

The other general question I'm seeking advice on is just if anyone has opinions in general for the Boston area on the best use of my funds at this point - a little vague I know, and while my agent is trying to give me the best advice he knows to (and he works with other investors), I just want to get some different perspectives because he seems fairly against anything needing any renovation.

Anyways, thanks in advance for your thoughts!

@Noberto Villanueva do have other neighbors on the street I do trust... and I've been communicating with them on the latest issue. They don't seem to find problems with the tenant like the one that always complains and think they are decent people and would likely address the yard if I talk with them. They are going to go ask if they're having a problem tomorrow. I will reach out to @Nick Mertens too, thanks for the suggestions.

@Bill S. My PM claims to do monthly inspections, but I never see a report unless I inquire about something being wrong there. My fault for not being more persistent I guess, but I find that though I have calls in to them and emails, I don't get much in return. Hard to manage when I'm busy and far away. I think I am going to give it a go managing the tenants myself again and putting them on a performance improvement plan for a bit.

Thanks @Thomas S., I agree that I don't have time for managing this property from afar now, or managing the PM which seems to take more time than it used to take me to manage my own tenants. I have owned the home for 9 years, and this is the first year with ongoing problems (which might be the neighbor more than the tenant). I don't believe the tenants have truly violated the lease in any way that I can legally evict them,  but I just don't have time for the hand-holding this tenant/property management pair requires it seems.

Appreciate all the inputs!

Originally posted by @Walter Williams:

Hi Becky, My name is Walter and I am a Realtor. I'm sorry to hear about the situation you are going through with your tenants and property manager, I had a similar issue recently with one of my rentals.

It is clear to me that a good property manager would benefit you tremendously so I wanted to let you know who I use and highly recommend.

His name is Tyrell Anderson and he has been outstanding in serving my property management needs. He wants to be known for his customer service to his property owners and tenants. He takes protecting my investment seriously and has proven to be a good steward of my properties.

I definitely recommend giving him a call, even if you do not use him as a property manager I know he would be happy to answer any questions you have about your current situation.

Best of luck!

Thanks again for this @Walter Williams, I am going to contact Tyrell. @Tyrell Anderson

Just wanted to reiterate, this property is in Colorado Springs.

As a follow up to this topic many months later, we resolved the previous problems, but have had a number of small annoyances along the way.

Now I've learned my tenants have let the lawn go and are not watering it at all, with tall weeds everywhere. Neighbors are very upset. It is in the lease that they must maintain it, but my guess is they can't figure out how to work the timer... they also have air conditioners in the windows which is not allowed by the HOA.

Still wondering why I find this out from neighbors instead of the property manager... but I guess I'm not enforcing better behavior. I was at the point that I wanted to sell the house, and move my money into a different investment, but with it looking the way it does now, I may need to sink some more improvements into it first unfortunately.

So I'm looking for some advice on which course of action you all would recommend:

1) Keep the tenant (who wants to renew and has paid the rent), despite their maintenance issues and the rumors they're part of some drug cartel I hear from the neighbors... but get a new property manager or manage it myself if I can correct their deficiencies.

2) Look for both new tenants and a new property manager (or do it myself since I did a better job vetting tenants to begin with).

3) Sell it. I'll have to spend a few thousand dollars to spruce it up and might have to have it empty before I can get it sold, which will be in the fall when the market cools off... so might rather get a tenant in there until next summer.

If you have any recommendations for property managers, and how I would go about changing one mid-lease (prior to lease end - end of Sept), I would greatly appreciate it and will follow up with them promptly. If you've been in a similar situation and were able/unable to rectify it, I'd love to hear what you think.

Thanks in advance,

Becky

Thanks for all the advice everyone!  

Got a report back from my PM. They inspected today and found there are additional people, cars, uhauls... but supposedly friends staying for a while waiting to move into their house nearby. Not sure there's much I can do in that situation as long as they really remedy the issue within 3 days as they stated they would. 

I really appreciate everyone helping me with the proper expectations and recommendations for property managers. I have provided feedback to mine, and will likely give them a chance to meet my new expectations. Hopefully giving them a second chance doesn't cost me in the end. I can break the contract any time, but will likely wait until the end of this lease unless things get worse, as some of you warned they could.

Thanks again!

Oh my gosh Nathan, I just watched the video. Lesson learned I guess. How did the owner react to that video?

Oh and it sounds like everyone is in agreement that if I find these issues to be true upon inspection, I should attempt to get them to correct the situation to comply with the lease, and if they can't/won't then I should evict? Thanks again!

Thank you Nathan! You're right, we did a terrible job vetting this PM. We only found a few reviews, and had a brief conversation on the phone, and we probably didn't ask the right questions at all. I wish I had found bigger pockets before I went looking for them a couple years ago because I know so much more now than I did then. I will definitely follow your advice about how to respond with both the tenant and the property manager and let you all know what happens. The resources you listed for finding new PMs are much appreciated. I was beginning to feel as though I should just go back to managing it myself because I've learned I am a better judge of who I would want in my property, as they likely didn't do the proper due diligence. But I should give other managers a chance to interview and see if I click with one that can represent my interests more adequately since I just don't have the time to be as hands on as it might require.

Thank you Michael. The lease is through next Oct. I actually don't know why my PM made it from Sept-Oct (as the summer is the easiest time to rent there and more than one year is strange. I will at least prepare to not-renew, but it's a lot more time to have them there bothering the neighbors. Has anyone ever evicted a tenant who was paying on time? You both mentioned too many people would be in violation of the lease, and that would be one way to act. Though as you mentioned it may be hard to prove. I also read you can evict for running an unauthorized business (also possible to hide) and causing a "nuisance" though I don't know what qualifies. Is it event worth it to consider this just because neighbors are upset, even while rent is being paid and house is presumably not being destroyed (yet)? Thanks!