All Forum Posts by: David Jay

I signed the management agreement several years ago but I am sure it does not allow this. No doubt I could just refuse to do so. I also know it allows a thirty day out for either party. Frankly, I think the PM is freaking out and did not think it through before He sent it. I have an interest in keeping his business running since this would be a bad time to switch PMs. And if I have tenants not paying it could be hard to find a new PM that would want to take over this type of problem. I reached out to speak with him but he asked I put it in an email. So I think I’ll just wait a bit and see how much rent comes in. 

I just got a letter from my property manager who manages eight single family properties that I own.  He is requesting that all owners pay the full fee they would normally pay even if the tenants don't pay rent.  Our state (NV) like many have a ban on evictions and late fees due to the Covid pandemic.  I think he is afraid that so many tenants will not pay that he is at risk of his business going under.  He is the only property manager I have used and he has been managing my properties for nine years.  I have been very happy with the job he has done.  But I don't think this request is fair.  What it is trying to achieve is that he will go on with his income stream intact while the rest of us take a hit. Additionally, since I own single family and many of his tenants own apartments and the fees are a percent of rent, my fees per unit are already double what many pay and I suspect my tenants are a lot less work (always pay on time and turnover is low.)  Obviously now is not a good time to shop for a new property manager.  What are your thoughts and how would you respond?

This may not be for everyone but here is what I am doing. We are all in this together and we are all going to take a hit. I live in Nevada and have 13 single family rentals. I am taking a proactive approach. I have informed my tenants across the board that for April I will reduce their payments by 20%. Our governor just shut all non essential businesses which includes casinos and restaurants etc....for thirty days. I told my tenants that we will also reassess this in 30 days. I think we are moving towards no evictions and want to avoid not getting paid at all. The 20% reduction allows me to pay the mortgages and bills but eliminates most of my profit. I can absorb this for a while. I believe some of my tenants have ongoing income, while some are more effected. Rather than analyze each one I did this across the board. No evictions does not mean no obligation. So if they do not pay the reduced payment promptly they will owe full rent and late fees. If someone is truly impacted I will loook at it case by case. Ourial estate market was hot before this and vacancies were low. But right now I just want to keep my places full and the bills  paid. I believe in karma and I hope by being proactive and kind I am doing this right. This may not be for everyone  and I welcome your comment s.  

I have a facebook page for my properties. When people respond to my Craigslist add I refer them there. It accomplishes a couple of things. First I have had tenants tell me they felt like my ads were legit and not a scam. Second if they like my page I have a direct link to their facebook page which is important for screening. I've rejected more than one applicant I might otherwise have accepted based on facebook. Pit bulls and wild parties are fine, but in your own home not one of mine. 

I am in escrow for a multifamily with one section 8 tenant.  Their lease ends in ten months.  I understand I need to honor existing leases.  My plan is to renovate the property and with the renovations move the rents to market.  The property is currently in poor repair with below market rents.  So two questions.  Do I need to sign up to accept section 8 rents or can I just make the current tenant pay the rent in the lease.  Is there any problem with simply not renewing the lease when it expires,

@Eduardo J. Rodriguez In my mind it's pretty simple. You need to decide your exit. Buy and hold or flip. You need to decide how much cash you can put in the deal and what your return and risk will be.   From there you can arrive at a price. The best purchases are the ones where there is no emotion. If you can't get it at a price that works move on. 

I still like this deal but I think the perspective depends a lot on the market you are dealing with. I do not know your market or the neighborhood. While you cannot bank on appreciation anymore than you can bank on a stock going up, I do believe there are markets where you will very likely see appreciation over the next ten years. I'm not talking boom or bust appreciation but rather 3-4% on average. So a deal like yours could see the property worth 220k in 10 years and your mortgage at 100k. Also rents should increase so your rent could easily be north of 1500. The key to a deal like this is getting it done with no cash in. I do not think it is a stretch that you could have 100k of equity after sale costs in 10 years. To grow zero to 100k in ten years is not an easy feat. Repeat several times and you have serious cash. 

There is probably no cash flow with those numbers once you account for maintenance,vacancies, and property management. However if I am reading this right you will have basically zero cash in the deal. Is your plan to buy for cash, repair than look for financing at the ARV. If you can pull this off with no cash out of pocket after financing you have 40k in equity, a tenant paying the mortgage, and hopefully the prospect of appreciation. That sounds like a winner to me.

The issue is not the screening of pets.  The issue is the applicants lie about the number, type and size of the pets on the application.  A look at their facebook page has disclosed this twice.  Now I am in the position of having to decline someone who will be working on my property getting it ready.  Not sure if this will affect the quality.

So give me your thoughts on this one.  A while back I got an application which looked good.  Income wise the tenant was more than qualified but owned their own business.  The application was approved by myself and my property manager.  That evening just out of curiosity I googled the business (which was legit) which led me to a facebook page and subsequently the prospective tenants page.  The tenant had disclosed he owned one mature boxer.  We allow pets on approval.  The facebook page had multiple pictures of him with two pitbulls.  I called my property manager the following AM and told him to tell the prospective tenant he could not rent.  While I am a dog lover myself, and totally agree you cannot judge a dog by its breed, liability wise this was a no go for me.  I am currently doing a gut renovation on what will be a very nice property for a buy and hold.  One of the workers has been asking to rent the place and told me today he would put down the deposit and the first months rent now.  Told him he would need to contact my property manager and fill out an app.  Said it was just him and a seven pound dog and seemed like he might make a good tenant.  Checked facebook and found he neglected to mention the 110lb dog he was pictured with and even had pictures of the dog trying to jump a seven foot fence.  Now this is kind of awkward because he's my contractors go to guy and skilled at most everything.  We are still a month out and don't want to get less than top notch work when I bring this up.  The icing on the cake is I will be out of the country for three of the next 4 weeks of reno.  But a 110lb dog in a 1000sq ft house is a no go for me.  So how would you all handle this one.