All Forum Posts by: Bob Beach

OK, I see lots of information that I did not think about. The house is under $100k which our agent says it's harder to get a loan on this amount. So, the seller finance makes more sense. But the $2300 down payment, $2500 over asking and paying the fees seems, not quite right. Our goal was to get rid of our older houses which need more maintenance ($$) and invest in fewer but newer houses. We're trying to get rid of the added stress of monthly repairs and simplify things. We have a couple newer houses, and they are almost invisible, just a monthly income. That said, hiring lawyers to write contracts, background and credit checks on strangers that already look nefarious may just add to the stress that we're trying to get rid of. Especially, if the deal goes sideways in a year or two. I see some good info about down payments being bigger, buyer damages the house then defaults, etc.. Another odd thing was the same buyer added a second option of a cash purchase that was close to half the asking price. Maybe to have extra cash for repairs. 

Anyway, we've made a decision, based on all the advice and knowledge from everyone here, to continue to look for a real buyer.  Thanks for all the great advice. It's very much apricated. 

We're selling a few houses in Memphis, and we have interest (letter of intent), on one house that's requesting, "Seller Finance". They're offering a few thousand more than asking and will also pay agent fees. Our agent is not an expert on this type of deal but suggested a short loan term of 3 or 4 years and a balloon payment and written up by a lawyer.  I've always steered clear of anything like these offers. Has anyone done any of these types of deals?

Thanks for any knowledge on this.

I believe Stephen pointed me in the right direction. I didn't know why I would need a license and for what. A bit of research and finding the LV .gov page and I see all the rules. And I don't fit into any of the requirements. 

Gregory, you're right. I don't want to own a hotel. I pictured a management company that handled rent collection, cleaning service, etc.. I think, for now, I will focus on a long-term lease if this idea turns into reality.  Here's a bit from the Las Vegas website on short term rentals. Thanks for the responses: 

A short-term residential rental is a unit such as a house or condominium that is rented out to guests for less than 31 days in a row. To operate in the city of Las Vegas, this requires a business license. To be eligible for a license, the home must:

• Be ‘owner-occupied’ throughout the rental period. This means the homeowner must reside on site during the guests’ entire stay. You would need to make this clear to your potential guests when you advertise the rental.

• Have no more than three bedrooms at the property, which would include the homeowner’s bedroom.

• Be located at least 660 feet from any other short-term residential rental, as well as 2,500 feet from a resort hotel.

• Be in a zoning area that allows short-term residential rentals.

• Have written permission from your Homeowners Association (HOA), if applicable.

We're considering changing our investment strategy. We have a handful of properties in TN and MS, mostly older homes and maintenance is starting to dig into our profits. We also have two newer houses that are fairly trouble free. So, we're thinking of selling the older houses and buying a newer house in Las Vegas (within 5 to 10 miles from Fremont/Strip area). I know nothing about Airbnb's so considering an Airbnb compared to a lease on a SFH. The Airbnb's I've seen are mostly condos and apartments, so can a sfh be an Airbnb? Lease the house would bring in about $2200 per month (minus tax, ins.) and so what would an Airbnb bring in? Can you keep it rented on a regular basis?

Thanks for any advice and knowledge. 

Quote from @Kim Scheid:

@Travis Biziorek and @Sean O'Keefe, we are looking to start with our first out of state rental and would love to know more about self management. I guess we assumed that we'd be hiring a PM. I would great appreciate more info in order to make a more educated choice. Thank you!

 You may want to consider a PM for a least the first year of a first out of state property. Screening and placing a tenant, they know local rules, they have eyes that can see the property and know what is going on there. A PM sends someone for maintenance and that's valuable info on how the house is being treated. A PM knows how to get the utilities going quicker if permits are needed. One year should show a track record of the tenant to see if you want to deal with anything bad or good. 

Why didn’t you take pictures when you visited last time? Everyone you visit take pictures with date/time stamp. 

I took many photos and videos of "EVERYTHING".
When I said, my sister doesn't believe anything I say is true, to expand on that. She thinks I have poor judgement. She says my dad has poor judgment. And he usually agrees with me, then gives in to her. 
  This is why I'm concerned about, what to watch out for.
Thanks for the comment. Helps me clarify. 

My 94-year-old dad has a rental outside of Sacramento. Small town, in the country, 2/1 on one acre.  My sister and I have delt with it but different opinions on how to manage it so it's now 95% my sister.  The tenant has been a problem from the beginning, such as behind in rent for a year, buys a brand-new Jeep, lies about ex-husbands job, child support, court cases, etc...

Now, the house needs a new deck, so I went up to inspect it. I found that the tenant has turned the property into a small farm. multiple pens set up with at least one pig, 4 or 5 goats, more chickens and ducks than you can count. The garage was open about 2 feet and had a screen in front of it so I imagine there's animals in there too.  In addition, there is an above ground pool, maybe 3 to 4' deep. The tenant never asked permission for any of this. I have rentals in TN and one tenant put up a pool and our insurance cancelled us till we had the PM get them to take it down.  We also have a "no pet" policy were a couple tenants brought in pets that caused issues. 

My sister did not want to get rid of the tenant because she was afraid, we would get "a bad person in". I've talked to my dad multiple times about the pool and animals, but he doesn't seem too concerned. My sister doesn't think anything I say is true. What are the liabilities? Thanks for any information. 

Quote from @Adam Bartomeo:

You are assuming that Roto-Rooter is right because they said nothing needs to be done and that's what you wanted to hear. BUT, what if they are wrong and the other company is right?

I'm not sure how you can justify that your property manager is the bad guy here...

 After the dust settled. I found out Roto-Rooter was half right. The house did not need re-piping but there was a leak they did not find. The PM's two guys were half right. There was a leak, but no re-piping was needed and the floor warping did not have to be re-done. My guy was the only one that was 100% right. He said, fixing the leak and the floors would settle down. And that is what he did, and the floors flattened out. 

Maybe the PM is not the bad guy but hires bad guys. 

Quote from @Cameron Tope:

Quote from @Nathan Gesner:

Quote from @Bob Beach:

Why did you choose this mom-and-pop manager? Is it because they were cheaper? You thought they would have more time to focus on your property and treat it like it was their own?

Cheaper doesn't mean better. I recommend you look for a professional manager who knows what they are doing.

Good on you for checking on their work and catching this problem. It's important to supervise your manager, at least for a while, to ensure their words back up their actions.

 This! 

 I've used the brick and mortar PM's (Evernest) with mixed luck. I saw a few people on BP that were using the "mom n pop" and recommended her. Just trying to find an honest service for an honest dollar. 

Quote from @Sue Gee:

Bob Beach, who are you using as your PM in Jackson Miss? if you don't mind me asking

I started with Evernest but currently with Dove Realty, (Katrina Hawkins).