All Forum Posts by: Jason Kern

As quickly, ethically and safely as possible recover the unit and get someone in there who loves it. Cut your losses and move on. I think "Eat the Frog" is the parlance here. 

Quote from @Katie Miller:

@Eliott Elias - people want community and a network. If they're asking questions here its likely because nobody in their circle of friends is an investor. Why not help them out even if it's something simple to answer? Make a new friend? Grow your network? (which, it looks like you do considering the number of posts you have!)

The people we help today could be business partners in a few years, you never know!

Katie, I think you nailed it here. The “weak” or “lazy” question may be just reaching out to connect. Give a pointer, connect, encourage, a little personal reassurance may help somebody make their first big step. 

Providing housing is a great way to help people. We'll always need rentals. So, create an income or some personal wealth if/when you have the chance and then give back in a way that resonates with you ethically and morally. I like to deliver food for our local pantry and volunteer to build houses. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Auburn.

Purchase price: $145,000
Cash invested: $39,000

This is a three unit building in Auburn, Maine is one of several that I own in the Lewiston and Auburn area. I'm most interested in buy and hold while "Managing it up" over time. I've spent more than I anticipated this past year but the position in the property remains strong and the cash flow is positive so it's building equity over time. I plan to hold this for a long term equity play.

How did you find this deal and how did you negotiate it?

This was a standard MLS listing.

How did you add value to the deal?

I've "turned" one of the units and updated several aspects of the other units. I've updated flooring, vanities, fixtures, exterior stairs and replaced the roof. I've also replaced the sewer line.

Lessons learned? Challenges?

Keep good reserves. You may need to use it when you discover a leaky roof or faulty sewer line. Expect the unexpected.

Hi David, I own several buildings like this one. The maintenance costs for these (at least in the first couple of years) can be higher than most markets so plan on having some reserves. Also, heating and electric have both had some pretty high jumps over the past 12 months so make sure to calculate those into your projections. Are you planning to use a PM? I notice you're in MA... It's a relief, especially in the beginning, to have some proverbial boots on the ground when needed.

Focus on your Core Four (David Greene's idea). Write up some questions to ask a realtor (ONFIRE acronym) and your property manager. The amount you have to put down can go a long way with the right people. 

Run the numbers on a zillion properties and trust them when they fit the model you want. The right one will come around. It will scare you and thrill you. It still does for me. 

Yep, if you're gonna dish out a charge you could be cookin' up some trouble with whoever **didn't** flush the fancy food. It could be a heated conversation trying to get them to fork over the cash but it might be time to spice up your lease with a 'lasagna clause'. There are a lot of layers to consider here...

Quote from @Marcos Carbi:

Great, thank you @Jason Kern! I'll definitely do that. Do you have a set time period where your tenants can call you? Do you recommend any important tenant responsibilities I should convey? I appreciate 

Candidly, I don't know because I *always* use a PM. Typically, my PM will gather all the tenant contact info and go make arrangements, etc. Contact info, hours of operation, emergency numbers, lease updates... I think if I were going self manage I'd work up a one-pager of guidelines with my best guesses. I'm likely not the best source for you because I'm sure I wouldn't be a very good property manager. :>

I'm curious to see how the folks respond who DO self manage?!?!

Have the seller let the PM know you won’t be using them. It’s not your relationship. However they may have some connections with service providers that know the building so get the PM’s contact and stay friendly if possible. Also, set expectations early with the new tenants. Inherited tenants can be a challenge as you didn’t vet and place them. Their expectations are important for more than just rent increases. Maintenance calls, response times and general tenant responsibilities should be part of early conversations. Also, if you do decide to use a PM at a later time they may be a great resource. It is all about relationships. 

Hey @Michael Macaluso - I’d grab a property evaluator like the one here on BP or the app “Property Evaluator” and start running the numbers on many many properties. Just set a goal to study 20, 30 or more. Once you’ve done that and shown a few folks who are ahead of you on the curve you’ll get a sense for what kind of traction you can get with 100k in equity. It’s a bit of a Mr Miyagi approach but it’ll serve you well and give you the beginnings of some intuition. DM me if you want some constructive feedback or another set of eyes.