All Forum Posts by: Christopher Gilbert

We buy houses on Auction.com every couple of months and there is always a reserve price that needs to be met.  The "winning" bid will go to the bank and if it does not meet the reserve they will counter with a much higher one.  You then have the choice to accept the counter or let it go and get your money back. 

If you track a certain property you can usually see it go through a few cycles and get a good idea what the bank is looking for.  Some of the other auction sites will say whether the reserve has been met and sometimes you have to bid against yourself to meet the reserve since the banks counter can sometimes be higher than the minimum reserve.

Just like ebay, most bids stay low until the last half a day or so and then they start taking off.  It is not uncommon to see properties go up tens or hundreds of thousands of dollars in the last few hours depending on how many people are bidding and which ones have "automatic" bid raises in place.

@Account Closed

I just did the same thing and after some searching was able to find a discount brokerage.  I recommend just calling and talking to some realtors with listings.  Over time the good, high volume realtors tend to migrate towards the cheaper brokerages and they will usually be more than willing to give you a few companies names.  Also look for some groups on facebook, etc. locally for realtors and chat with some folks there.

Even though you may not plan to help other folks with your license, I recommend building a network of contacts with similar investors.  Should you come across a deal that has good numbers but you are not in a situation to jump on it yourself, pass it along to them.  You would be surprised how many deals that you can put together without having to do any additional work and also help build a tight group of followers.  Representing other investors on half a dozen deals a year can make you enough in commissions to put a down payment on another rental property or two for yourself every year.

@Steve Rozenberg

I always 1099 anyone that is not incorporated.  Contractors that run an incorporated business (not just a dba name) do not need one since they are responsible for their own books.  I believe the dollar amount that the IRS requires is anything above $600/year worth of payments requires a 1099.  We have had a few contractors in the past give us false ID/SSN's and the IRS sent us a few letters saying that if we used them again we would have to withhold taxes on the payments.  We stopped using them since it wasn't worth the hassle.

Make sure that the contractor knows up front that you plan on giving them one so that if they are self-employed they can plan appropriately.  More importantly make sure whatever contractor that you use is insured for medical and liability since that can cost you much more than a few extra bucks in taxes if someone gets hurt and tries to sue you. 

Any legitimate contractor will not charge extra for taking a 1099, only the shady "cash deal" ones charge extra and my experience has been to shy away from them.

@Chuck Redman

I have had both in my rental properties and they seem to be decent units.  The summers are hard on A/C's here so it seems like regardless of which brand I have every 5 years or so either a fan motor or starter capacitor goes on them.  They are both better than the dirt cheap brands which seem to have issues every year or two.

@Marcus Auerbach

 Where I live you have to have an itemized statement showing everything that you deduct from the security deposit or else the tenant can protest it.  Which means that you either have to show a repair estimate, a replacement estimate or absorb the loss and learn a valuable lesson about quartz countertops.  The picture that you have does not look too bad, I would probably just leave it and move on.  

As a side note, I put a lot of granite with multiple colors in our rentals since it is dirt cheap here (quarries locally) and still looks good if it gets stained a little bit.  I tend to stay away from the other materials since even the expensive ones all seem to get dinged or stain easily.  If you get any more rentals in the future and granite is not an option then stick with the cheap formica that looks like granite and plan on swapping it out every 5 years or so.

@Karla P.

Sell.  We are starting to cycle through our older rentals and selling some of them to free up the equity to invest in properties outside of Austin in lower tax rate areas.  If you are making $100/month and have over $375k in equity then your return is sub 1% per year.  We are in the process of a 1031 exchange on one of our properties but everything is so high right now it is tough to find anything larger in the area to roll the money into and still make an acceptable return.  We will end up buying multiple single family houses further out in the suburbs with better cash flow but probably should have just taken the 15% long term capital gain tax and used the remainder to pay cash at foreclosure auctions for better deals.

@Tarah Kawal

 My wife and I have multiple rentals and do flips in the greater Austin area and anything newer with little to no rehab in the suburbs are going around $160k+ but should be getting you decent cash flow ($300/month).  We are still finding decent cash deals at the foreclosure auctions for $120k-$130k but even those typically require $10k-$15k to get rentable.  If you are willing to go further south (Buda/Kyle/San Marcos), east (Manor, Elgin) or north (Leander, Round Rock, Georgetown) you will have better success finding good rental neighborhoods. 

We both have our real estate agent licenses and primarily buy just for us but also help other investors that we know when good deals come along.  Let me know if you are interested in getting any help or need any second opinions on anything.

30 day notice and that's it, no other reason to argue or debate with her since the lease is month-to-month.  If she doesn't move out after the 30 days then start the eviction process.  If you are not willing to do that then turn the house over to a professional property manager and let them make the tough decisions.

Going forward, there are usually clauses in the standard lease contracts for your area that cover these situations and protect you.  Any standard lease will restrict the occupants and say that any damage that is not regular maintenance is covered by the tenant and not the owner.  Check with a local realtor or another landlord to see what forms are used and see if you can get a blank copy of one.

If you have ever had to stand in front of a judge and go through an eviction as a landlord you will know that they do not look favorably on anything being seen as harassing towards a tenant.  A judge where I am will not even look at the case until the date the lease is up because no violation has taken place.  There is no way to get a judgment against the tenant in this circumstance since they are still within their lease rights.  Even if it were possible I think it is a terrible idea since evictions stay on the tenant's record and can harm everything from their credit score to future rental prospects. 

The best that you could do was serve notice to vacate and then wait until the actual day after the lease ends to go schedule a court date.  It will take weeks to get on the docket and then another few weeks to get a constable out there if you win.  If you try to get on the docket before a violation has occurred the judge will throw out the case and you will have to re-file again anyway. 

@Tony Duran, I live in Austin and have all my rentals in the greater Austin area. In today's market you can still find good deals but they are mainly for cash buyers and at the foreclosure auctions. We just picked up a property in Leander, TX for $120k that rents for $1500/month so they are out there, just have to know how to find them. Most properties in the MLS are hitting the .8% rent/value which is not particularly great and the 1%'s are usually snatched up the first day on the market. Austin proper is ridiculous but some of the suburbs are still doable. Both my wife and I are Realtors so if you have any questions please feel free to contact me. Most of our properties have almost doubled in value over the past three years and have good cash flow so we still plan on investing in Austin for a while to come.