All Forum Posts by: George H.

I am also considering section 8 for my next property. I am a new investor having bought a large duplex in Brooklyn with my VA benefit in 2018. It pays for itself and will cash flow well when I rent my unit out, but for now I am thinking of buying a duplex early next year and was thinking that the way the economy is at the moment and for the near future, a section 8 property might be a good investment.

I did read James Wises post about Cleveland Section 8 with the pros and cons, but would also like to hear from other investors in the area regarding their thoughts.

@Brian Garlinger what percent of your Cleveland rentals are section 8? Are many multi family? Have you found them to be longer staying tenants? Pros and cons?

@Bob Prisco You said "its all about screening, I put in 90% govt tenants". Are many multi family? Anything different in your screening process? Pro's and con's in your experience?

I did read The Zillow article regarding them. Namely, the listings may not be current. But it seems there might be deals had in this current economy. And it seems safer than a courthouse step auction in the sense you could see the property and even pay for an inspection or appraisal. I would assume these are usually on the list of marketing and mail campaigns. 

I would be interested to hear what more experienced investors think, and any tips they might have.

It happened to me last year. The PM went there less than a week before tenants were due to move in to check condition after some cleaning and minor repairs and found all appliances in the lower unit of my duplex were stolen. The carpets in 3 of the 4 bedrooms were cut out and taken, with the 4th still in the BR rolled up, ready to remove. My apartment on the 3rd floor was also broken into with small things missing. I had only bought the property a few months prior and there was little furniture. But the thieves did take a TV, coffee and end tables and 2 suitcases with my clothes. I had yet to buy a dresser. I work for the military and was away at the time. They even stole cheap silverware that I noticed missing after cooking a ramen when I returned to assist with getting it rent ready prior to tenant move in. Clearly they stayed a bit and planned to probably return.

My insurance did cover losses minus my $1,500 deductible. Clearly this was not a quick in and out job. And I feel the lock box advertised the place as empty. Fortunatley there was no vandalism. There are now Ring Cams all over the place, and Wyze cams in my apartment.

I  am a new landlord working for the military (civilian) and seldom at the property so I do have a property manager who seems pretty good. During the 6 month walk thru my pm realized the tenant were slobs. They are responsible for lawn care and keeping property neat and clean. They were permitted 2 small dogs. There was dog waste all over the unkempt lawn, and had a cat and 3 kittens in the basement leaving it smelling of cat urine and the place was a mess. She informed them they need to clean the place up and upon the next visit it was clear they were not responsible tenants. They were given the option of getting things in order, or moving on , thus forfeiting deposit.

They chose to move out in 45 days and would be released from the lease provided property was move in ready, It was not.

I assumed when asking pm if they chose vacating they lost deposit. She said of course. I thought breaking the lease was cause for deposit forfeiture and any damages beyond normal wear and tear would be their responsibility. The pm noted what needed to be done to get rent ready and even noted in red text what was not normal wear and tear. It seems the pm expect the non normal wear and tear ‘should be less than the deposit’. So no repercussions from breaking lease?

I know many will say ‘good riddance’, but I would prefer filing small claims against him on principle. I have a good deal of experience in that area from a prior business i owned in Florida (and even made pm aware I was willing to go this route on my own. This guy is active duty military and I know they sometimes can ‘motivate’ a member to get his affairs in order.

So, in closing (yes, finally), is it common to just write everything off and settle only for deposit? Or is pm just taking the easy road, even with me filing claim and dealing with it?
 

@Bob Collett 

Tank you so much Bob for taking the time to respond. I did PM you a more detailed response. 

As you can see from a post I made above, I did try to explain that the original post was more of preferences with the few hard and fast requirements I do have.

And again, thanks to all offering their help here. 

@James Wise 

Thank you for your input. After giving my criteria the proper reflection that should have been given prior to my posting, I agree with previous posters that I would indeed be asking too much if I insisted on all that to be a requirement. It was never meant to be carved in stone, just a starting point.

When I wrote that criteria yesterday I did not give proper time to form what I was looking for in criteria.

Please let me differentiate between what I would ‘like’ and what I would ‘require’. Sorry for the confusion and thank you to all who helped show me the errors of my post.

I understand my criteria is high. I am flexible on some things. Really, the only things not flexible would be:

*background/credit checks on anyone over 18 and they be on the lease.

*rental history of at least a few years and not just current landlord

*income 3 times rent so they do not over extend themselves

One mistake that was pointed out from someone else was the the implication I was looking for 5 years employment history, which makes little sense. I only need that income verified to be 3 times the rent a amount. Sorry for not being clear about that. Also a 620 might be high for that area. That is something I would leave to the PM as he knows the market far better than I do.

And, as all PM companies know their leases better than I do and as such can better enforce them, I have no problems with their leases. I would want to see it, but would most likely be ok with what they had.

I am sorry for not being clear with what I would ‘like’ and what I would ‘require’.

Thanks again for everyone’s input. It is very much appreciated.

@Gwen Fyfe Tank you very much for your input. Sorry, I did not mean income verification for the 5 years. Only current employment matters. Perhaps I made the same mistake in my initial email. Thank you for pointing that out.

I can appreciate their wanting to use their own leases for the exact reasons you mention. I would have no problem with that.

So, should I assume most will want a one year agreement? Again, if that is the norm, I’m sure I can accept that as well. Of course I would prefer shorter, but I can see their POV.

The property is in the Malvern neighborhood. 

My situation is that I am due to close on a property mid June and I am still looking for a PM.

Since I deployed overseas, I need someone to take care of things until my return in November.

I wrote to a few yesterday. The only response so far was from a David with Re/Max property management. After asking if I would want to select criteria for a tenant and the length of agreement I was informed we were not a good fit.

My criteria was not overly hard to fill in my mind. Verified income/background for 5 years, 620 credit score, verified income 3 times the rent, no evictions filed, anyone over 18 gets same checks and is on the lease, and no pets. I also wanted to use leases and such that are Cleveland specific that I got here on BP.

I stated that I would prefer a 6 month agreement to ensure PM was doing as agreed upon. I got a short ‘no thanks, not a good fit’.

I can possibly understand his not wanting only a 6 month agreement. But as he was not specific for his reason of ‘not a good fit’. I understand they make their money primarily by placing tenants and collecting a share of rent. The less criteria, the easier to do so. 

I have no doubt some PM’s just want a warm body with upfront money. 

Again, am I asking too much to set minimum standards?

@Lidia.   Do they handle existing properties or just ones they sell?