All Forum Posts by: Ryan K.

Why do credit/background checks?  I did that on these people 2 years ago and it was spotless.  They supposedly bought the house from a motivated seller and are selling it to motivated buyer, more or less breaking even (so it appreciated at least 6% to cover broker commission is my guess).  If they were approved by a bank to buy an $850k home last year, now selling that home for a gain, I know them and have positive experiences and believe they have solid character, we were neighbors for a while, their young girls are very sweet (and occasionally very helpful with yard work) ...why would another background check be required?

I own a nice home in a nice area.  Similar house on the corner just closed for $710,000.  3 bedroom home, 2.5 bath, nice but really kinda basic.  It's a great neighborhood and the best school in the county is just down the block, so it's primarily a family neighborhood and I prefer to keep turnover dates on the school schedule.  We are in the down-valley shadow of Vail and Beaver Creek ski resorts so there is international wealth pressures, lack of affordable housing and general scarcity.    I believe high demand will continue in the future and vacancy will be limited to less than a month (in 5 years of ownership and 4 tenants, turnover vacancy has ranged from overnight, to 1 week).  This makes a great formula for being a landlord.

The current tenants are out tomorrow.  I placed a yard sign last week and ZERO other marketing.  I've shown the house to 3 potential tenants and they have all been A+ (no background checks yet but my gut feelings were A++).  It has become a difficult decision to choose who would be best in the home.  

Asking rent is $2550 + utilities, first last security deposit is $7650 (which both strike me as a ton of money and beyond what I'd comfortably choose to afford, but this area is kinda going nuts).

Last night, the most recent prospective tenant (single mom and high school daughter) said she would sign a 2-year lease and have the cash to me before Monday.

The other competing tenant (family of 4) is actually former tenants.  They were in the home 1.5 years, great tenants, no issues.  Bought a house for ~$850k last year, moved out, are now selling that house for a profit because this area is kinda nuts, but now they need a place again.  They would require no background check and are financially solid.  They can only commit to a 10-month lease (which takes us to 5/31, on the school schedule and likely a time of high demand) and will almost certainly leave at that time, as they're looking at jobs outside the area.  I told them the other people offered a 2-year lease and they countered w $2900.

All other things equal, what is better?

10-month lease at $2900 to a known quantity, but having to clean, repair, and market the property again next summer?  $29,000 and maybe a higher established rent going forward?

Or $2550 for 2-years?  I haven't ran a background check yet but my gut feeling was definitely A+.    $61,200 guaranteed over 2 years?

I haven't even mentioned the other family, but they were incredible and I would rent to them in a heartbeat but I feel like I've already got a tough decision on who to choose.  Good problem to have!

Too expensive relative to your market? It's the cheapest SFR in my market.

Our market is so nuts, I'm back to thinking this property is a good investment.  There is a huge demand and no supply and prices keep climbing.  I ran a stress test at a 10% drop in rents and it was still positive cash flow (barely).  Just wary of how frothy things are now...Everyone is a little nervous but (barring nuclear war, which seems like a decreasing risk) I see no reason for the local music to stop.

Is it a silly time to buy?  Is it ridiculous to buy an expensive property in my area?  My other properties in this area have appreciated significantly in value and rents.  I've been studying national and local market and wish I had a crystal ball.

It is a nice house in an expensive area.  A washer and dryer is expected.  The home was built in 2006, so the original (2005?) appliances are slowly crapping out.  But "my" washer was in there when the house was rented out (~$2900/mo 3-bedroom), so it's expected that there is washer.

The tenants actually picked it up, along with new stainless braided hoses, and installed it themselves.  Normally I would avoid that kind of thing at all costs but in this situation it worked out well.  I'm going over there tomorrow to pick up the old one and will make sure everything is hooked up right but they assured me it's good to go and already been used.

Thanks guys!  

Washing machine transmission broke in one of my single-family rentals.  $315 for new part.  Brand new machine, same size, more efficient for sale at Home Depot for $298, so the 15-year old washer is getting replaced.

The 2 rubber hoses look good but I assume they're original (15-years old).  Are $35 stainless steel braided replacement hoses worth it now, or is this a silly upsale?

Thanks for the offer!  I didn't mean to single you out.  I would prefer something west of the Mississippi though, never been too interested in the East Coast.

A colleague of mine moved to the mountains from Florida.  He thought people would pay crazy for the beach, until he saw the ridiculous prices to be near a ski lift.  I'm about 20-30 minutes down valley, in the "affordable" locals area but the prices are pushing this way from both the resort and the overcrowded CO Front Range.

OK stranger on the internet from across the country.  Where can I send the check?

But really, I need to find better options because its too expensive around here.

I'm 33.  This is my retirement portfolio.  Never sell unless better opportunities arise!