All Forum Posts by: Brad L.

Note that this is not something I'd recommend, just a story of something that was done by someone I know which ended with the result they wanted.

Neighboring vacant parcel owned by out of towner who was not diligent in maintaining said parcel. Out of towner would not sell the parcel to individual I know, and continued letting the weeds grow wild. After the City finally mowed, Individual I know started spreading fertilizer at night and when weeds grew out of control quicker than usual and out of towner did not cut after a period of time, individual called the City. Did this maybe 4 or 5 times, and after those 4 or 5 fines the out of towner was ready to negotiate the sale.

Again, I wouldn't recommend it and I wouldn't do it myself. However, if it's making your property look worse and causing issues, you need to protect your investment.

That's a good amount of baggage. Some municipalities require that kind of thing to be disclosed to potential tenants, so be sure to check on that in your area if you do move forward with the purchase.

PITI looks like $920.25 based on your numbers above, definitely warrants a further look depending on amortization/term of the loan from your family member.

Add in 25% for vacancy, maintenance, capex and $150/mo for water/landscaping and that puts your monthly cost around $1,501.50 with $111.75 cash flow per unit. Even though it's "totally redone" I'd personally still account for maintenance and capex, but would be more forgiving on the low monthly cash flow per unit since those expenses may be relatively unlikely.

Additionally, I don't get inspections when I purchase, but since there was a fire I'd definitely get an inspection to ensure things were actually corrected and they didn't just slap lipstick on a pig.

Seller always chooses the title company in my market, and it's not unusual for an Agent to influence the Seller's decision.

You should start by going to a title company and having them put together a Letter Report, may be known by a different name in your area. This would show owner of record and any liens against the property.

Letter Reports are inexpensive and would keep you from wasting time in the event your agent is incorrect and someone else actually owns it.

Call your bank to make sure their check clears before issuing a check back to them.

You may want an attorney to review the title commitment if there are exceptions that you do not understand.

@Tomiko Graves unless high-end finishes are a must in your market I would just reglaze the tile and tub, will cost you pennies compared to that $13,00 quote

Demand for unit size varies based on location. For example, 10' x 20' units and larger are in much higher demand at my facility (population of ~45,000 within a 15 mile radius), which is located in what I'd consider to be a more rural, but still city, community right on Lake Michigan. A lot of renters store classic cars, boats, 4 wheelers, snowmobiles, etc. and my 8'x10' units are much more difficult for me to rent. 

Not to sound cliche, but location is everything in the self-storage industry. My facility is located in the middle of a residential area (rezoned residential lots) and I have nowhere near enough units to keep up with demand, but I know the facilities on the outskirts of town, which although they are mostly still full, have a harder time doing so and often have lower prices.

I'd imagine in the bigger cities maybe the smaller units are in higher demand due to renters storing more household items and less vehicles, boats and other toys, but maybe someone that owns a facility in a bigger city can comment on that.

The one thing I really dislike about my facility is that there is no additional land build more units, so when purchasing an existing facility keep that in mind. If it doesn't already have 125+ units, you may want to find something with room to expand.

In my experience income levels don't play a huge role, as I have tenants of all income levels. The exception of course being if your facility has 15'x20' units for $600/mo in a low income area, or something extreme like that.

Number of units is a tough one because that can vary from owner to owner. Do you plan to manage or will you hire that out? On-site manager? There are a lot of options for remote management of a facility, but if you can't physically get there every couple weeks at minimum, you may want management and would have obviously have to figure out at what number of units that would work.

Any other questions?

You need a deed conveying the original lender's interest (received via the deed in lieu of foreclosure) to you. As of right now, owner of record is that original lender.