All Forum Posts by: Jordan L.

Hi BP! I’m considering switching my 3 SFR rentals over to strictly 2 year leases as turnover costs are cutting dramatically into my returns. So far I’ve yet to have any tenant stay longer than one year. All 3 properties are in the southeast and are 3 and 4 bedroom homes in good areas. Do you use two year leases? Do you find it difficult to find tenants if you don’t offer a 1 year lease? Thank you in advance! Jordan

Just a follow-up... a day or two after Christmas I had a good, qualified tenant who wanted to move in at my asking price ASAP. :) Best of luck to all of us in 2018!

I'm a newer investor looking to build passive income through buy-and-hold rental properties. I've set a goal to purchase at least 3 more SFR rentals in 2018 (I already own 3 rentals and one primary, purchased from 2014-2017). Yes, I realize this volume isn't impressive. I'd love to do more. Much more. I suppose you could say I'm setting a realistic goal for myself based on past experience.

Though I've just recently started putting in offers, I spend hours a week analyzing properties for sale in my target market.  Currently I'm looking in the Charlotte, NC area.  This is a hot, competitive market and I'm struggling to find anything that meets my criteria:  decent enough neighborhood that I would live in it, move-in ready or close to it, projected cap rate above 6.5% after expenses (including PM).

I don't mind making tons of offers and getting rejected over and over.  I don't want to frustrate my agent, however.

With what seems like sellers' markets left and right, is it moot to spend hours a day scouring the MLS and crunching numbers?

I should add to this that I live in California, and I work a 60+ hour workweek here with the goal of building capital so I don't really have the time, connections, or knowledge to look for off-market properties or remotely manage major rehabs.  I admittedly also suck at networking.  Introvert problems.

I'm thinking of shifting my target market to a less competitive area where I can get closer to the 1% rule in decent areas with a move-in-ready or very light rehab property.

Do you find what you're looking for on the MLS these days in your target market? If so, what are your criteria? I'm interested in hearing some more experienced stories.

Love BP and its wealth of knowledge!  You guys are all awesome!

Hi all, I have a home in suburban South Carolina that has been posted for rent at what I think is a competitive price for 19 days now. I don’t particularly want to lower the price as I feel I’m pretty spot on. According to my property manager I’ve had a couple of walk-throughs but no qualified applicants at this point. I know for most people life seems to stop around the holidays. Do you all experience this? If something is vacant in mid December, is it likely not to get leased again until January? Thanks everyone! Jordan

I am a relatively new landlord with three rental properties that I’ve acquired over the past few years. This week I have come across a situation that I have not yet encountered. I have a tenant who would like to do improvements at their own expense. These tenants are brand new, and in my newest rental. The property is a 3/2 SFR on some land with an attached carport. It was a probate property that I did some extensive remodeling on, spent about 25k too much on— and I got screwed by my *now former* contractor on the quality of the finish work. Lesson learned there of course, and that’s beside the point for now. These new tenants have contacted my property manager, and asked permission to have garage doors with openers professionally installed and to sheet rock and insulate the garage at their own expense. They are aware that the materials will stay with the property when they move. My first inclination was to run the other way shouting, “NO!,” because if something sounds too good to be true then it probably is. However, I got to thinking that if I allowed these tenants to do this, they would probably stay longer than just one year, allowing me to avoid unnecessary vacancy and more quickly dig myself out of the hole I have on this property. Also, free garage doors don’t sound too bad, as we are all in this for the money. If I were to allow them to do this, my approach would be as follows: I would have to approve any professional companies doing any of the work. I would communicate with these companies not to proceed with the work until the entire balance is paid by the tenant. I would have to approve the look of the garage doors for aesthetic purposes. I would have a written agreement from the tenants stating that I am not financially responsible for any of these specific improvements, and that they agree that everything stay intact and with the property upon their move out. I would also include in this agreement that I am not responsible for the maintenance or upkeep of the garage doors or openers anytime throughout their tenancy. Alternatively, I would just say no. I would love some more experienced opinions on this!

To answer all the questions:  I already own the property and have done extensive work on it so voiding the sale wouldn't be an option at this point.  The inspection did state that the HVAC wasn't working, but didn't estimate the age or state a potential reason.  I was informally told via text from my agent (who I think is no longer working as an agent) that it was a 5 year old unit.  I did use an attorney to close and did not insist on seller repairs.  The sellers were a group of 5 siblings who inherited the property from their parents.

Thanks all.  I figured it would be too much of an expense and a hassle to figure out the source of the "misunderstanding,"--  live and learn I suppose.  Every property has taught me a lesson thus far, and I don't anticipate that changing, though I'd like these lessons to become less painful...

I closed on a property in late May sight unseen that will be my next rental property.  It's #3 for me.  The property was in need of a lot of updating and repair, and I was aware of most of its issues due to a home inspection.  I dramatically under estimated repair costs and I think I have ended up with my first bad deal, but that's another story.

 On top of this, during the inspection the HVAC was not working.   I was told by my real estate agent that the sellers said the unit was only five years old and was working when the property was last occupied.   They said they thought it was a problem with the older thermostat.  I have this in writing via the text thread from my agent. 

Fast forward to now, and I discovered that the unit was installed in 1997 and needs to be replaced.  This adds $6000 to $7500 into an already blown budget that I was not expecting.   The same installation company that installed the unit is still around--  I had them out at the property today and they said they made the seller aware in May of this year that the unit needed to be replaced. 

 What should I do, if anything at this point?   Seasoned investors...  what would you do?  I am all the way across the country from my rentals--  I'm also not the type to seek retribution for small things but I was absolutely lied to and I'm kicking around the idea of doing something about it.  Can I even do anything?

Thanks all.  Hope everyone is having a better day than I am!

Thanks guys.  @Joe Villeneuve how do I refi? I know this may sound like a rookie question but I have not had to deal with financing much yet. I own my two rentals outright. I have a call and an email into a lender that I'm waiting to hear back from on this. Do lenders even touch non-purchase money loans on NOO properties?

Hi all,

I'm a relatively new investor looking to expand my portfolio exponentially. I'm 30 years old and I own 3 SFRs, one of which is my primary residence and two of which are rentals. I bought my primary residence at 23 and worked like a mad dog to pay it off. I then refinanced with a HELOC, and have used this cash to purchase and renovate my 2 current rentals. I'm currently in contract (yay!) on what would be my 4th SFR.

If I close on this property, I will have exhausted all of my available cash.  At first I thought I was going to invest conservatively--  pay off each property before purchasing another, so that financing never becomes an issue.  The older I get, the more I realize that I need to hurry up.  I want to enjoy my youth while I still have it.

Thus the question presents itself.  What do I do now?  

I am fortunate that I have a decent job and I am able to pay down mortgages relatively quickly. Also, my credit score is in the 800s and I have a very low DTI.

I still work like a dog.  I work in the high-end restaurant industry and I'm not sure how long I can keep up these 60 hour workweeks.  In my early to mid twenties I was working 80 hour weeks.  Irrelevant, but that was my strategy.

So... should I pay down my HELOC asap, use it to put 20% down on a conventional loan on each new property, then use the HELOC again for any necessary renovations to get my properties rent-ready? Does conventional financing significantly limit one's ability to buy distressed properties and fixers?

Should I just got for it and look for 100% financing on everything? 

Or... does something along the lines of a portfolio line of credit exist? I have a lot of equity in the 3 homes I own. I'm guessing a HELOC won't even touch something that isn't a primary residence. To complicate matters, my 3 properties are in 3 different states.

Thank in advance everyone.  I want to hear how you've done it!

Hello (again) Biggerpockets!

I have a SFR in contract that was built in the 1950s, and not tested for lead or asbestos-- I'm going to assume that there's probably both within the home. From all that I've read, lead and asbestos are not that big of a deal unless one inhales dust, eats paint chips, or something of that nature. This is my first pre-1978 property (it will be property #4 for me if I close). My plan is to do some major updating and hold it as a long-term rental.

Should I be concerned about lead or asbestos in the property?  I want the home to be a safe environment for my tenants, but it's not worthwhile to continue to closing if I'm going to end up with a very large remediation bill.  

What are the liabilities for a landlord if no testing will be done?  The property is in North Carolina.

 Thanks for any thoughts.