All Forum Posts by: John Kunick

Quote from @Leon G.:

I just sold my Duplex in TX and still have a SFH waiting for the tenant to leave. With the super high valuations and 2.1% tax rate I was just renting to get maybe 7 or 8% return. I finally decided to sell my assets and move my rental business to Oklahoma. I am just browsing places to buy, I have been looking at Tulsa, Durant and Oklahoma City.

@John Kunick, do you have a Real estate agent you can recommend? How much should I pay for a 3/2 for rental? Other than the property taxes of about 0.5% are there any other payments I need to make. I wont buy into an HOA.

I am just a bit hesitant because I don't live in Oklahoma but could move there if I start growing my RE portfolio.

Thanks!

Hi Leon, yes, I can refer you to a real estate agent that I've used in past to buy these types of houses.  But, I have not bought a house for a few years as I've diversified into other things.  Therefore, I can't really give you too much insight into current valuations or costs..

I have properties in 74008 (Bixby), 74133 (South Tulsa), 74011 and 74012 (Broken Arrow)..  I focus on 3/2's in B/B+ neighborhoods in top school districts.  Have had these for many years and they've performed extremely well.

@Christine Goodwin, quality properties go quickly here in Tulsa.  I listed one of mine this week and had 40+ inquiries within a couple of hours and had it re-rented within 24 hours.  Something certainly doesn't seem kosher based on what you reported..  Feel free to PM me with the addresses and I will do a little research and perhaps give you "on the ground" feedback.
I would like to understand the situation with the garage..  Does the garage go with one or both of the properties?  Should the garage be removed?

@Leon G., totally understand why you are wanting to get out of dealing with tenants and being a landlord.  I did the same thing several years ago, but for very different reasons.  I put most of my funds into syndications and couldn't be happier!  I actually am making better returns with almost zero headaches.  I don't miss all of the tenant and property maintenance issues, but have more $ coming in than ever before.

Ashcroft and Rise48 are two really good multi-family syndicators, but there are many others.  Reliant is a good self-storage syndicator. PM me for any follow-up questions.

I know this doesn't specifically answer your question and many may not appreciate my input, but I would really look at investing in geographies that don't have these types of legislation and regulations.  This is also one of the key reasons I don't and never have participated in government housing programs.  I don't want government as a partner telling me what I can or can't do with my properties.

Having said that, I do wish you the best of luck in your situation!

Quote from @Troy Green:

Yes the rental market should experience a surge in occupancy which in my opinion is why companies such as Blackstone and Vanguard have been focusing on buying up residential homes. The one caveat is owning rentals in non desirable areas. With recessions typically comes layoffs, and if people cannot afford rent then occupancy rates rise. This is why I feel buying in more desirable areas lowers your vacancy risk. 

@David Mathews, I tend to agree with @Troy Green in a lot of ways.  His market and mine (Tulsa) typically share a lot of similar dynamics..  I do think rentals will continue to be a great way to make money in this economy as the less people can buy, they more they will have to rent..  The key questions then become what types of houses will do best..  In my experience, the sweet spot will continue to be "B" class..  The C's will try their best to climb up to B's while A's will come down to B's to save $..

It would seem, as Troy mentioned, that C's could have some occupancy issues.  What might become more concerning is not just occupancy but also collections.

In closing, I still see high demand in B's.  However, I  am not having much turnover with most tenants proactively renewing their leases before they expire.  The few openings I've had have either been rented very quickly or being filled from waiting lists.

@Van Tran, I echo a lot of what was said by @Jill F. and @Richard F..  First, what type of property is it (poorer neighborhood where lower credit scores are norm or nicer area where higher credit scores are norm)?  Second, "why" is their credit score low?  I've found, with "aspirational" tenants, where they had legitimate reasons for a lower credit score (instead of this is just a way of life), they will do almost anything they can to improve their credit scores if given a chance.  The only way to know is to dig into it via the application/screening process.  I usually advise them, when they ask to fill out an application, that they need to divulge anything that might come up on the background check (I use simplescreening.com).  If they do so and it matches what comes back, then I say "let's talk more about this"..

Bottom line: I've had some of my best tenants over the past 15-20 years of doing this were those that I would not have rented to them if a low credit score was the reason why I didn't rent to them.  However, I put most of them on a "6-month probation" lease up front and let them know I'm taking a chance and please prove the credit score wrong.  Yes, it took a lot more time up front as I would check in on them every couple of weeks to see how they were doing, but they seemed to really appreciate that someone believes in them and is rooting for them..  Many of those tenants have been incredibly loyal (and grateful)..

Scott, I've owned many rentals and for a long-time.  I've always done the best in Bixby and Broken Arrow.  Although I have no personal experience, I've heard Jenks and Glenpool are also good.  Depending on your goals, I would be careful of North Tulsa as they tend to be C type properties with lots of headaches.  Yes, they can be profitable, but in my experience, just not worth the hassle.

IMO, one of the unintended consequences of the unconstitutional Eviction Moratorium is that the very people that were said to be helped are going to be the ones hurt the most long-term.  Thus, we raised our screening standards to make sure we know the backgrounds of any tenant and are re-doubling our efforts to verify rental history and employment..  In the past, we might look past questionable marks or situations.  Not now..  Those that took advantage of landlords via the EM should not be rewarded! @Ryan Bird, IMO, it really matters what class of property you are talking about.  In your case, an A property is probably the most ideal situation to attract quality tenants as they tend to be "aspirational" with their most likely next step being home ownership..  Class B is probably the best situation right now with tenants that can't afford to buy, but have to keep renting, but want to be accountable/responsible to move up to Class A and eventual home ownership..  Class C is where you will most likely want to avoid if you are looking to build your portfolio..

@Ryan Brown, when I got into rentals many years ago I did a survey of several landlords in terms of what was customary for this market (as you are doing now)..  Interestingly, I have purchased some homes that came with refrigerators (they were not rentals when I bought them)..  So, when I had tenants ready to move in, I offered to donate the fridge to them if they needed it with the understanding that they were liable for any repairs.  I think I had one or two that the tenants had their own, so  I think I either sold it or donated it to someone who needed it.  It's been several years ago so I forget the exact details.  Bottom line: not providing a fridge and washer/dryer is customary here..