All Forum Posts by: Gary L Wallman

Looking for advice on a potential tenant.   Ran application through rentredi. No criminal or evictions.  Has been in same rental for 9 years.  Moving b/c landlord is selling duplex and she has always wanted to live in my property. She has emailed me about once a year asking if I have openings.  Im lakefront on lake erie and she lived across road.   Solid income at 4x rent at a good hospital job.  But her credit is bad, 480s bad.  Looks like a bunch of small balance credit cards and such.   She gave me her current landlords info and permission to contact.  If all checks out with him im leaning towards a yes.   Should I reconsider?

Hi Bigger Pockets -- I have a situation I'm not sure how to deal with, am hoping for your help. For context, I am a new investor who is househacking my first property; at this time I do not have a lawyer, and the house is in my personal name (rather than an LLC).

I have former tenants who recently moved out, and they took it upon themselves to "fix" the pinholes where they hung pictures. They accomplished this by painting large, discolored squares in multiple areas, of every wall, of every room (with only a couple exceptions). The color difference was not subtle, I've attached some images for reference (links below) -- it was like this through the entire house, total of 3 bedrooms, a kitchen, a living room, and a hallway. We attempted to match the color for touchups, but failed to do so (the house was recently purchased, original paint samples unavailable). My former tenants also left a decent amount of cleaning to be done, ~10 hours worth. I received a formal bid of $3,200 to fix the paint, and then did all the work myself.

All things considered, my tenants received back ~1.6% of their $2,250 security deposit. The charges included A) $110 worth of remaining utilities, B) $835 for cleaning ($235 carpet + $600 for labor), and C) $1,270 for paint damages ($295 for supplies + 30 hours of labor at $32.50/per). Along with their disposition of deposit, I included and referenced Bigger Pockets' Vacating and Cleaning Instructions and Itemized List of Common Deductions (both of which were provided to tenants ahead of time), images of the damages, an invoice for the carpet cleaning, receipts for the paint materials, the page of their signed lease saying they are not to paint without permission, and finally the formal $3,200 bid we received. 

My former tenants were predictably less than enthused, and they are now threatening legal action -- they claim that because I could not provide them with the appropriate color, the paint is not their responsibility. There is obviously nothing in the lease which defines it as my responsibility to provide accurate paint samples upon move out, but they don't see it that way. Naturally. 

I am not sure how to proceed -- aside from this situation, these were quality tenants. They paid rent early, took care of the property, etc. -- they were great at living in the rental, they just weren't great at moving out. As far as the cleaning, I believe we simply have different standards for what qualifies as "move-in ready". As far as the paint, these tenants genuinely spent a lot of time and money *trying* to fix the situation; they just unfortunately made it much, much worse than if they had done nothing at all. 

I am 2nd guessing how much I charged them for the cleaning, and am also considering a small refund on the paint based on remaining materials. At this point, I honestly just want them to go away. Is it worth sending them more money, or is that a slippery slope which will just leave them asking for more? Should I hold strong to my claim that their painting violated the lease agreement, and that I would have been fully justified to hire the work out and send them an invoice? 

Any advice you have would be much appreciated -- thanks BP, you're always there when I need ya! 

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Hi All,

I have been reading and reading about real estate and feel ready to take the plunge. I am finding better deals that cash flow is stronger in SFHs compared to MFHs, but am worried about scale with SFHs. My understanding is that at most you can have 10 mortgages at once, which severely limits your ability to grow with SFHs without paying cash. How/can you get around this? 

Maybe I am missing something...?

Listening to people beat up on the young folks for having their student loans paid off. Look at this people born between 81 and 96 are getting poorer while the rest of us are getting richer. What this is really saying is people who own assets like real estate are getting wealthier and people with no assets are finding less and less opportunity.  I imagine any group whether it be blacks, hispanic, whatever that had a disproportionately lower share of assets is getting disproportionatley poorer.  Yes, buy real estate and cash-flowing assets, but next time you are complaining about a kid having their stupid transgender studies loan paid off be considerate of the fact this kid does not have the opportunities of the generations before him.  And as mighty and righteous as you are maybe don't lecture these millennials quite as much about how hard you had it and all the jobs you had when you were 12 years old, they didn't invent helicopter parenting they are the victims of it. 

https://www.dailymail.co.uk/ne...

 Wow Gary, That is great! When did you start your journey?

 Hi Sebastian, 

I recommend the major cities in Ohio:

-Columbus, great for appreciation, pp is a bit higher around $220k for multifamily https://learn.roofstock.com/bl...

-Cincinnati, has a mix of cash flow and appreciation, with average multifamily around $180k. https://www.noradarealestate.c...

-Cleveland, has a lot of cash flow potential, average multiform around $140k. https://learn.roofstock.com/bl...

There are other smaller markets like Dayton, Akron, and Newark, and we are starting to see these areas boom due to huge investors and corporations like Intel choosing to set up shop in these kinds of areas.

Ohio has all 4 sessions which can be very nice. You can sometimes even have all 4 on the same day. It would be a great market to start out in with the high demand for housing and affordable living. 

 I guess I should have made the caveat biggest losers as it relates to buying rental properties.

Yes anytime rates move up like this it affects the mortgage industry and the Title and escrow industry. With refi business pretty much stopping in the owner occ sector but in the investor BRRR sector refi is still alive and well thats how i get paid off on my deals and we put payoff demands in For September on about 20 files in the last week all those are refi's.

As for RE agents since they are independent contractors other than I think Redfin .  nothing much changes there those that cant make it move on they don't get let go. and the top producer just get stronger shifting economies always affect the RE brokerage side when its hot bunch of people jump in when it cools like now the fittest survive the others look for other occupations or move to part time. 

New construction is its own category..  And since you mentioned it we are active in a few states in New builds.. mainly here in Oregon.. Sales in my mind have slowed from a frenzy to a more manageable pace for us. I would not want to be on 5 different subdivision with the associated debt and have to make numbers . for score card we started 14 specs in Feb we have sold 8 all for full price plus extras. So instead of like 18 months ago were I presold my phase one in 3 months  ( 30 homes) then had to build them like a mad dog.. we have a better flow now we have semi custom top of the market product in the development so producing about 2 to 4 homes a month is our speed and sales so far are right in line with that absorption.  I do have on 2 mil spec that has been on the market for 2 months but its getting shown and we may have to lower price on that but I am only in it 1 mil so plenty of room to lower if I need to. 

I bought a house SAn Antonio.Its a brand new community with lot of investor homes.My rental  is through a property management company.I have reduced rent 3 times .My zillow contact is 43 totally but only 2 showings so far.My PM suggests to reduce further.I wont have any cash flow with that low rent.what do you suggest.I want to rent it out asap.

Hi fellow landlords,

Today I had a situation with one of my tenants in NC. This tenant has been paying rent always on the 5th, although the lease agreement says the rent should be paid on the 1st of every month. She pays on the 5th because on the 6th there will be a late fee. I would not have a problem with it, if she would have explained to me any difficulties she has in advance. But no, it looks like to me that she pays late on purpose and with no good reason. What disturbs me is her attitude. She was yelling at me over the phone and insisted that paying on the 5th is not considered paying late. She literally told me that I will get my rent on the 5th, that's it.  What is even more disturbing and ridiculous is when she needed AC maintenance, I had it fixed on the same freaking day as she submitted the request. But madam was angry at me for not having done it faster. That's why yesterday, I sent her a PAY OR QUIT NOTICE after she was late again. Since she has such a high expectation on the maintenance, I would also demand on-time payments.  Has anybody had similar issues with their tenants? Can I evict her if she continues doing this? I mean is 4/5 days late a good enough reason to evict her? Thank you in advance for any feedbacks! 

P.S. she has eviction history and a bad credit score. But I still took her because she appeared so nice during application, and was so desperate looking for a place to rent, and promised that the eviction was due to her pregnancy which was six years ago and she had paid off everything. Now I regret being too emotional and naïve. 

yup all cattle no hat.. document and keep the deposit.. if she goes to court and you dont want to spend the money just default and pay her then.. chances are like Mike said she is bluffing.

PS in most states attorneys are not allowed in small claims.. its mano o mano