All Forum Posts by: Carraig Stanwyck

Since I know I'm moving to KC now, I have been keeping an eye on Craigslist to get a general familiarity with rents in different areas and for different types of properties. The last paragraph of this ad made me laugh out loud. Sorry if this was posted by somebody on these forums, but come on...

http://kansascity.craigslist.org/apa/3265385020.html

I think you'll do fine Mark H. The only other experience I have renting is when I first moved to Texas after finishing my military commitment. I rented a 1/1 flat from a local REI in a cute 8-unit multiplex and paid cash up front for a 6mo lease to secure a lower monthly rate. It was an awesome experience and I'd recommend her to anyone! She was flexible, friendly, and provided excellent customer service.

Ultimately, I believe that customer service will always pay for itself through referrals.

For those of you using a PM in the Seattle/Tacoma WA area, message me offline and I'll give you more info so you know who to avoid.

There are a lot of posts on here about tenants from hell, but what about PMs from hell (from a tenant's perspective)?

My wife and I rented a place in WA because we were contantly flying back and forth. We are the perfect tenants. As landlords ourselves, we know to take care of property and pay on time. We maintained a yard service to keep the yard up and only lived in the house about 1 week a month putting very little wear and tear on the place. The house is in a generally nice area.

Unfortunately, the PM is the rudest person we have ever met and the reviews online by many other renters show we aren't the only ones who think that. A couple of the many examples are:
- When the house was broken into we called the emergency answering service to ask if the PM was the one who had entered the house before we called the police to file a report. PM threated to charge us for the call because a break-in isn't considered an emergency. (ultimately, we found out a well-meaning neighbor with a key entered the house to bring a fedex box in out of the rain and decided to 'explore' a bit...)
- When the bathroom sink broke this week the PM acted like we were the worst people in the world for wanting to get the sink fixed. (called during normal hours this time).

If we had needed the rental longer than one year we would have found a new house STRICTLY because of the PM.

It certainly gives us a new perspective on ensuring that our PM treats us right AND treats our tenants right. I would hate to learn that my tenants wouldn't renew the lease, even if they liked the house, because of the poor service by the PM.

Something to keep in mind...

Scott W. You're right, we did pay a higher rate by a full point or two probably. House #2 is around 6%. House #1 was too but used appreciated equity to refi down to under 4%. Not looking to keep House #2 long enough to warrant the refi costs.

We pay 10% for property management. My hat goes off to those of you to do it yourselves. My patience would run thin very quickly.

As for all of the stories about expenses, I learned the hard way. My first tenants in House #1 had kids...who caught the house on fire (BAD fire) when playing with matches. Insurance covered it and I collect higher rent now because it's nicer than it was before, but I still had about 6mo of lost rental income which my insurance at the time didn't cover.

One of the benefits of having served in the military.

:-)

Jeff S.. I think you're right. It makes sense. Just shows how important the additional research is beyond the 50% rule.

Appreciate the insight.

-C

Scott W., I do not have PMI. These were both our initial residences. House #1 was bought for 112k in 2007 with zero down. House#2 was bought for 80k in 2005 with zero down.

Great point on the principle being paid down.

Thanks!

I agree it doesn't seem right Jeff S. 50% is supposed to cover escrow, maintenance, PM, etc, but in the case of House #2, escrow plus PM is already more than the 50%.

Hrmm...

Hi,

Been lurking for a while and reading everything I could. Initially when I read about the 50% rule I thought that my two rentals were bad deals, however for some reason I completely missed that escrow is part of the 50% expenses until @Jon Holdman mentioned it in another thread I read today.

That puts a different spin on things and I'd love confirmation that my math is right. First though, my rentals were not bought as rentals. Rather, they are my first home and my wife's first home. I know now to look for better deals.

House #1
Rent-$1400
Payment-$922
...of which $350 is escrow
So $1400 minus $700 (50% expenses) minus $572 (mortgage payment not including escrow) equals positive cash flow of $128.

House #2
Rent-$750
Payment-$665
...of which $330 is escrow
So $750 minus $375 (50% expenses) minus $335 (mortgage payment not including escrow) equals positive cash flow of $40. However the formula doesn't work for this one because with property management, that and the escrow eat up over 50% of the rent by themselves which leaves nothing for maintenance. This is the house we plan to get rid of in a year or two. Taxes are much higher in area of House #2 hence the higher escrow.

Am I doing the math right?

Thanks,
Carraig

Rant reminds me of my father complaining about grammar...via text...using text-speak (to/too=2, for=4, "I Don't Know"=IDK, etc).

Complaining about stupid questions on the basis that people don't spend time researching the answers is valid, but seems silly when the same post has no less than 11 spelling errors.

Wait...I bet those were intentional...

:-)