All Forum Posts by: Account Closed

@Account Closed do you know what the #1 detriment to making rentals profitable is (besides nonpayment of rent)?

It's turnover expenses: fixing up a property after tenant moves out and the lost rents due to vacancy.

A landlord really can't afford to turn tenants every year!

Also do the math, each month of vacancy costs an owner 8% of their rental income (1 month / 12 months).

So, tenant stability is key to making money.

Looking at it another way, would you rather lose 2 months of rent every year (turn costs + 1 month of vacancy) or take 5% less monthly rent for a 2-year lease? How about 10% less rent for 3 years of tenant stability?

Which way will you make more long-term money?

What @Alecia Loveless said ^^^^^. Only a one year lease. Life can change so fast, you don't want to be locked in.....One year lease with incentivized options.

I agree with @Alecia Loveless. Absolutely do not do a lease of more than one year. 

@Account Closed I would also advise to raise the rent a little each year but not enough to make then upset or run away. If 2795 is the current market rent for a property like this, then you might raise it a little, so by 50-75 each year after the current lease ends to cover cost increases (prop taxes, prop insurance, labor costs, etc). If you are well below market rent, you might want to raise by a little more. 

@Matthew Sharman I just wouldn’t recommend signing a lease for more than one year. It’s not worth it. Too many things can happen in the market causing rents to skyrocket. Or something could go wrong that you need to get the tenants out. You never know.

I’ve been effectively “incentivizing” tenants in one building to continue renewing their leases in a town where I haven’t been able to find any comps by not raising their rents for 3 years. Two nights ago I FINALLY found my first comp and realized my rents are now $400 under market value and I’m now locked into leases until next November.

I strongly recommend not doing more than a 1 year lease.

 Mine is customized to my properties and my needs.

I have a tab for each property. Here I have contact info, lease info, AC filter, trash day etc plus all the income and expenses.

Then I have a Master tab that has all properties, so I have the big picture of gross rents received. You can have a formula to pull the individual property tab income to this master tab.

I have my ROTH IRA owned properties with a different colored tab and they are in a separate section on my master tab. They are summed up separately and then at the bottom I can add everything up to see what all properties are combined bringing in.

I have this on each property tab for expenses and income. I also keep track of the date payments are made.

My partner has our properties on Rentredi. I like it fine.

My personal properties I use Excel.

It is very powerful and customizable. Tenants pay with Zelle, PayPal etc.

Only takes me a few minutes per month to put in Excel. 

I’ve had rental properties for over 22 years. Granted we only have 17 but still, I’ve never used anything except a simple excel spreadsheet and all my rental properties have a separate savings account under my main account at my local bank. They don’t charge anything for these extra accounts, my tenants pay directly into those accounts. I’ve never had a problem with a lender when I showed them the deposit that was made into that account. People are making this way too complicated.