All Forum Posts by: Christie O'Malley

Thank you, @Ernest Grindle and @Joel Owens. Your information is very informative and helps greatly. The current tenants have been in the unit for over 10 years with a lease that has never been altered and no rent raises. They pay well below market value at only $9/sq foot and the going rate is $12-15 in the area. The current lease is a simple Rein contract that our attorney has said is not something he recommends using. There are provisions in the current lease like paying their share of the lawn maintenance and taxes but they have never paid these in the past, so only the base rate is what they pay. 

Joel, thank you for the recommendation. I will definitely reach out to Andrew this morning. It has seemed odd that a Commercial Attorney would not already have a lease on stand by that I would be able to use. Do you find with commercial units that you do not need to use an attorney in your state? I have only been in residential until now and Virginia residential leases require a Virginia attorney. 

Thank you both again for the information, it is much appreciated. 

Congratulations! This has to be such an amazing feeling and accomplishment. Scaling up and finding the tax strategies to benefit. Amazing!

After trying a few different property management softwares, I settled on Hemlane. We knew that we wanted to grow exponentially and needed something that was user friendly for not only us but our renters. It has been one of the best decisions. Very streamlined. You can use them to list directly on websites like Zillow and Trulia. The leads will come directly into your account and you can invite the prospective tenants to apply and complete a full background/credit check. Leases are uploaded to the system and it allows you to keep all communication with each tenant in one simple space. Rent can be collected through ACH or credit card. (I do not use the credit card option) Once you reach a certain milestone, you can add team members to help you manage your rentals too! It is a pretty neat system and exactly what I was looking for. Hope this helps. 

Congratulations! Such an exciting journey! Completely agree on the "Don't order everything on Amazon!" We have also found that Ikea is a great place to buy furniture. Let a college student spend the day assembling everything for you. They will enjoy the money and you will enjoy the time you didn't have to spend putting the furniture together. Win win!!

Hi All, 

Late November, we purchased a property that is considered mixed use in Chesapeake, VA. Along with residential units, there are two stand alone commercial units. The units are up for renewal soon and I am in need of a retail/office space lease to send to the current tenants. The current lease is very vague. With that said, I reached out to a Commercial Attorney but we have been waiting for over a month for a lease. With the renewal being in February, does anyone know where I can get my hands on a lease that would fit this criteria?

Thank you kindly, 

Christie

Hi @CJ M., 

You might consider posting a sign that the house is "under surveillance". This could deter the culprits. If your tenant was interested, a strategically positioned outdoor Ring camera would more than likely catch them in the act. It might be a little pricey but much cheaper than replacing multiple windows. 

Best of luck, 

Christie

The advice to use comps is a wonderful idea. Thank you, @Brock Mogensen, @Colleen F. Our comps from local MLS are showing the 2 bedrooms should run $1200-1250, however those comps do not include owner paying water and owner up-keeping the lawn, both of which we do. Our current rents are $750-875. So, this will be a rough road of potentially losing tenants that have been in place for many years.

@Peter Nikic your advise of completing it one step at a time is sound. This will be the best approach as more than half of the leases are month to month. As for the commercial spaces, they are undervalued by a few hundred a month and up for renewal in February. Luckily, we are professional rehabbers and already have one of our roofing companies very interested in leasing the space. The biggest issue with this is two of the best tenants work for the current commercial space and the business pays their rent. 

This is going to be a very interesting few months but also very exciting. I really appreciate all of your advice. This is a big step for us and it is good to hear from other experienced investors.

Hi all, 

We are purchasing our first "apartment complex". It consists of 3 duplexes, 1 triplex and 2 commercial units. Before closing, I would like to have a general idea of how to appropriately go about increasing rent. In the past, this was an easy task with only one or two tenants involved but with 11 we do not want to ruffle too many feathers so quickly. We have plans to go in and do small upgrades to each unit before writing the letter to the tenants. Each unit is significantly undervalue for the going rate in the area and many of the tenants have had leases in place since 2010-2012 and never have had a rent increase. This will be a shock to all and we want to handle this the best way possible, as many believe this is their home and would like to stay for years to come, understandably. 

Does anyone have a book they have read that has helped in best practices for commercial purchases and rent increases? I need to comprise a letter to the tenants and would love to hear how other investors have handled such situations in the past. 

Thank you,

Christie

Hi all, 

Lately, I have been trying to do my best to learn the different tax laws and am confused on a few different things. Recently, my accountant told me that if I hold a property for over a year in a LLC that does multiple flips a year, it will still be taxed as ordinary tax and not the capital gains tax. This particular property was land that was being subdivided to sell parcels. Everything I look into says if you hold for over a year you receive the more favorable capital gains tax. Does anyone have a direct link to help me understand if he is correct?

Also, I was advised not to defer taxes from an "opportunity zone" because it would require an S-corp or a partnership. Neither, according to my accountant, is favorable because if you have to move the property out of a corporation it would mean serious tax implications. Also, something about not being able to write off depreciation. He is a very good accountant but everything I read tells me the opposite of what I have been told. If anyone has a link to an IRS page that could help me understand the different implications of rental property in a corporation vs sole-proprietor, I would greatly appreciate it. 

Thank you, 

Christie