All Forum Posts by: Jason Grey

My 2 cents. Unless you have an immediate need for cash you should sell when it is empty.

1. Do not renew lease.

2. Paint and replace carpet in common areas (Vinyl Plank is good bang for the buck)

3. Sell on the MLS with a Realtor.

If you sell with tenant inside, especially while it is getting below market rent, you will leave a lot of money on the table.

I'm interested in hearing your thoughts on whether the demand for quadplexes will continue in Huntsville/Madison during the Covid-19 crisis. Most quads in the area cater to lower income earners and those working in the service/gig economy. It can mean that the risk for non-payment of rent on these types of properties will likely be higher at this time. Is the increased risk a turnoff or is there enough pent-up demand to carry us through this crisis?

@ Dave DeMarinis excellent analysis. I agree with mostly everything you put forward but I would like to respectfully add some content for consideration.

(1) Single family houses are not necessarily readily available to rent. The rental market is so competitive that most people do not list their homes for rent, they all have waiting lists. Rental homes are difficult to find, especially for renters seeking to pay $1000 or below. 

(2) Most small Multi-Family buyers I have run across are more interested in cash-flow than in appreciation. The duplexes and quads often offer great cashflow with less risk because the rent is spread across several renters. These units also seem to be appreciating at the same rate or a little faster of the market.

(3) Turnover is typically higher. Most renting between 12 and 24 months but they are exceptionally easy to find tenants for. Most 2 bedrooms/1 bathroom in C+/B- areas do not stay unoccupied for more than a week.

Huntsville is on the move and although deals are harder to find (especially flips), buy and hold seems to be strong and all indications show it will be for quite some time.

Job growth, nationally recognized cost of living scores and rent and property value appreciations are a few important indicators that Huntsville is a win. 

Assuming the same purchase price and property condition, would you prefer Option A or Option B when buying a Quad-Plex in the Huntsville/North Alabama market. If you can ad some details as to why you prefer one option over the other it would be helpful.

Option A. Established tenants. All 4 units rented. Leases and property management in place.

Option B. Property rent ready but all 4 units unoccupied. No leases or property management in place. 

Assuming the same purchase price and property condition, would you prefer Option A or Option B when buying a Quad-Plex in the Huntsville/North Alabama market. If you can ad some details as to why you prefer one option over the other it would be helpful.

Option A. Established tenants. All 4 units rented. Leases and property management in place.

Option B. Property rent ready but all 4 units unoccupied. No leases or property management in place. 

I had a client who 'house hacked' a quadplex and I recommended using a PM. They lived in one unit and the other 3 units were rented. The other tenants never knew that my clients, their neighbor, owned the property. In my opinion keeping a professional distant is one of the most important aspects of owning rental property and something a PM facilitates. What I have found is that tenants are more likely to pay rent in full and on time when they are paying a PM as opposed to 'the landlord'.

Sent you a private message. Lots of good choices in the area for sure though.

Hi Phillip,

Try to at least drive the area prior to purchasing to determine if it meet your criteria. 

608 Eastbrook Drive is a couple doors down and is currently leased for $1195. It is a 4 bedroom 2.5 bathroom, 3000 sqft and was a full rehab. I think that $1195 would be your very top end on rent and you would adjust rents downward depending on the type of work you do to this property.

Goodluck,

I'll be up working for the next 2 or 3 hours. You are welcome to pm me and I will help you in anyway I can.

Sincerely,