All Forum Posts by: David Moore

@Justin Egge

First, I want to acknowledge your growth as an investor.  You are considering a perspective from someone in another region, and considering the alternative possibilities.  

I have four properties in Albert Lea, MN.  None of them are 2%, but are between 1-2 %, and I bought three of them from banks.   Unlike your investments in southern metro, these properties appreciate little.  I bought them strictly for long term cash flow. 

I am looking for a 6 to 8 plex right now.  My key marker is not 1 to 2%, but cash flow.  Higher cash flow, means quicker debt repayment, means better long term capital.   

I know nothing about Kansas City, Memphis and Jacksonville.  I stick to my backyard, as J Scott advises.

@Gerald Barron

Reading this thread was tough, because no one was asking the right questions, that is until @Anthony Wick, who asked the pertinent questions.  What are your costs?  No one here can really answer correctly for you ,if by doing this lease, you will lose money.  If you are making $500 bucks, that $200 gone will hurt for two years.

Also, I disagree in part with those who are saying a vacancy will cost you more.   Your lease should have a provision that you can show the property after the tenants have given their notice.  We just had a vacancy in one of our apartments, and filled it in October (thanks to God) in Minnesota, because our lease said we could show the unit with reasonable accomodation.  The unit will not be vacant even one day.  I agree with them that vacancy can be a huge expense.  Something to weigh.

There is another factor.  Locking in a two year lease means you put yourself at risk.  What if market rents go to $3200.00.  You'll be thinking about that quiet a bit, I bet.  

@Pavel U.

Love it!!

@Joseph Lee and @Brady Mickolichek

I will check out both.  Thanks!!

This is short and sweet.  Anyone know a locksmith for changeovers?  Someone you recommend?

@Luke Carl

I'm just curious why you own a property with such low rents.  $1120.00 in total rents to cover property taxes, utilities, insurance, mortgage,not to mention repairs.  One key problem I see is the cost of the eviction, compared with your rents.  Compressed rents create all sorts of problems.  It is not easy to keep up with quality repairs.

But I see your portfolio, and you clearly know what you are doing.   So my main question is...why keep this property?  It is giving your problems for so little return.  That's my two cents.

@Brady Mickolichek

I'll send you a screen print of it sometime this weekend.

Just wanted to share a neat trick I picked up from a realtor in Albert Lea, that I modified with the help of @Tim Swierczek, who found a site with a totally free form I can use to pre-screen tenants.

So, the realtor associate in Albert Lea told me she pre-screens before anyone sees the place.  Historically, people would call or FB, say, "I want to see it", and 25% of the people would show up, and none of their data would be documented.  So I added a step to the process. Tim suggested a free form site at wufoo.  I created a form, placed my ads out there, and started getting a lot of hits.  

I directed interested parties to provide their email, and then sent them a link to the form, that is like an application form, but much shorter.  It has worked brilliantly to pre-screen.  I get a general idea of their income and other pertinent info.  If they meet my criteria, I set up a showing.  We've had much better success with people showing up and actually applying to rent from us.

This screens out tire kickers like crazy.  I've gotten well over 50 hits on FB Marketplace, and of those, half have sent their email, and half of those filled out the form.  I then send email links to our full application to people who followed the process, and have interest in our apartments.

This is going to be fun!

First, @Sam T., you have made, potentially a fatal flaw in your analysis.  In your 2nd post, in which you said you would clean it and then possibly replace it for a new one, because the tenant is 'potentially good'....or something like that.  You are new, and the tenant is new.  You don't know anything about this tenant.  And you have to watch your cash flow.  And Georgia is different than Minnesota.  People here don't up and move November through March.  Not sure how things roll in Georgia.    Getting another gas stove has hidden costs.  Depending on your municipal government, you may have outdated gas lines leading to the stove.  If you buy new, the delivery company might well not install it.  In Minny, you have to hire a plumber to install it ($70.00 extra bucks right there), and you may have to pull permit.

A secondary consideration.  Buying used appliances is risky.  Cockroaches can travel in coils of appliances, and you don't know the repair history, even on a gas stove.

@Joe Splitrock

Wow, slumlords, eh?  I don't see it that way.  I see a bunch of other people who are involved in difficult day to day decisions on managing their money, so they can accomplish their goals.  It's not nice to judge people, Joe.  You don't even know most of us at all.

@Gena Morris

Don't project your experiences on all people.  Landlords are not rich barron's, smoking stogies, and driving cadillacs.  This business is hard work...every dollar counts.  

@Ethan S.

First, you have my sympathy.  It is good that you are reaching out asking for advice.  I completely agree with @Nathan Gesner.  A relationship with Jesus has been my bedrock, the very foundation of my life since age 17.  Jesus is not religion.  He literally saves people...I've seen it many times, and he saved me.  Offer to go to the Church with him.  

The other advice I would have is to just listen to him.  Take him out for a coke, and let him talk.  A great friend is one who listens.  He will learn that he can do many things to help his situation, just by bouncing it off a good friend.  Your active listening will help him sort out all the conflicting thoughts he has.