All Forum Posts by: Chris Patrick

I think what you're seeing for the unrented houses sitting there might just be the same houses that are priced above the Zillow estimate or at the Zillow estimate but with something slightly unattractive about them.  I know many people think "Zestimates" are useless, but they're actually pretty spot on when it comes to cookie-cutter suburban rental houses that don't have tons of upgrades.  Try to track fairly attractive houses that are listed right at or $50 below the Zillow estimate and see how long they sit there.  With better pics and $50 less on the asking price, I think you'll be fine.  $1200 for a $112k purchase with no work on your part isn't bad.  If you don't desperately need the cash you invested in this house, it's probably not worth selling unless rents drop below 1% of purchase price.

Al K., I'm speculating that house prices and even rents are going to have to cool off over the course of the next year, but I don't think that's the reason your house is still vacant.  

My first thought is that the photos advertising the house are not as attractive as they could be in terms of lighting and resolution.  The resolution of the pics don't fill the frame on sites like Zillow, so your pics (and the house) look smaller and dinky compared to the competition. Next time you get a chance, take the exterior pics during spring or early summer when the grass is green and all the trees have leaves.  It might seem inconsequential, but it makes a difference when renters are scanning through tons of options and want a home that stands out as lush and inviting.  

My other thought is that although it seems to be in good shape and has pretty good schools, it's still a 1970's property.  Parents might be willing to throw their kid under the bus just a tiny bit in order to rent one of the many 2000's houses a mile away, even if it means their kid goes to a middle school that's ranked a 6 instead of a 7.  They can get a brand new house that feels more open for maybe $50 more a month.

Your price is right at the Zillow Estimate.  I'd try lowering $50 and see what happens.  If you bought this house for $85k-ish, you should be sitting pretty even if the rent eventually drops to $1100.  Finally, it's probably the slowest time of the year to be renting it out, so try to get a 6 or 18 month lease so that your next attempt is timed during the peak season.  Hope this helps...

There have been recent articles about Chinese investors pouring money into rental properties in US suburbs as a safe investment since their own rental market and stock market are in trouble.  Much of this is supposedly all cash purchase and they're more interested in finding a place to stash their cash for stability and potential long-term appreciation rather than cash flow.  Have any real estate agents or investors seen this in Houston, San Antonio, or Dallas?  Is it having a significant impact by inflating prices, or is it fairly minimal?

Al K, could you show us more about your property?  A link to the rental ad would be great, but if you don't want to share that then maybe just let us know the school district, sq ft, and whether the living room is carpet/tile/wood laminate.

@Robert Carl Thanks.  Do most of your C tenants just leave under normal cirucumstances after 1 or 2 years, or are there a lot of evictions and midnight moves?

Robert, that's lower than what others are reporting.  Why do you think there's more turnover in your houses?

the lowest turn-over rate is class C and B, right?  and A/D have the highest?

Congrats.  Having long-term tenants is so important.  

One of the reasons I'm curious is because in my areas PM's take 1 month's rent to place a tenant (on top of make-ready costs and vacancy), so I use that in my analysis spreadsheet.  But surely the average isn't changing tenants once a year.  When I crunch the numbers, it seems like it would be better to lower rent $100 or more if it would keep a good tenant in place or get them to sign a 2 year lease.

What's the average number of years tenants stay in your SFR and 1-4 multi properties?

Please specify your property's class A/B/C/D, SFR or 1-4 multi, and if you self-manage or use a PM. I'm more interested in averages as opposed to the few who stayed for 20 years.

Thanks @Brie Schmidt.  Does the requirement to pay taxes in the state hinge on whether you deposit the rent into a bank account there or receive payment at an address in that state?  Or does just the fact that you have a property in that state mean you have to pay taxes there?

Years ago I won a competition with a cash reward in California and ended up subletting an apartment there to take care of business for several months.  The competition asked if they should send the check to my sublet apartment in CA, and I said yes to make it easier.  Then two years later after I'd moved out of CA, I ended up with unpaid taxes and liens that I had no idea about!  I was told if I'd just had the check sent to my permanent address in TX, then I would've never showed up in the CA tax system.