All Forum Posts by: Jon Burns

I am looking for a referral for a property manager in Akron Oh with an established vendor list and has experience with out of state investors.  Any information and/or referral would be greatly appreciated.  Feel free to add to the the thread or send me a private message.

Property is located in 44301 zip code.

This is no doubt an interesting time for the Houston housing market.  I recently had 2 of our properties come up for rent in September, one in Sugar Land, and the other in Richmond.  We have had a lot of traffic in the Sugar Land property, but no lease.  Last time this property was on the market, it was leased in less than 2 weeks.  The Richmond property, same story, rented in less than two weeks.  That property is about to go over 2 weeks, and sadly we have only had 2 showings.  We just lowered rent in Sugar Land to below what we had it rented for recently.  We left the Richmond house at the same rent, and feel we have the best product at the best price for that neighborhood and not a lot of activity.  So is it the housing market, is it the time of year, I don't know....probably a bit of both.  I know I would want my kids settled in school for the beginning of the year, and I am sure many other families feel the same way.  There was an uptick in market activity for August (per HAR), and maybe that was the main driver behind it, families wanting to be settled for the school year.  

Here is what I do know.  I am not hitting the panic button, and I am not cutting rent to below market to just put somebody in a unit.  I will keep the rent competitive with other properties.  I will be stepping up our marketing, and aggressively following up with prospects.  The homes will rent, just at what price point.  I am prepared to hold steady and see what the market will bear.

Funds received!  Tenant has paid her portion, and I have received confirmation from the churches involved that funds have been sent.

Update:

Thanks again for all of the input.  It has been interesting reading all of the varying view points, and experiences of others.  It has helped me put together a process for how I would like to handle these issues in the future, should they come up again.  

As of today, I am awaiting a check from two separate church's that have pledged assistance.  It will not be enough to cover the full amount owed.  The tenant has indicated that she will be able to pay the balance when she gets paid this coming Thursday.  She has also said that her son is ready and willing to help out.  Her employer is getting her in a position to be placed on short term disability, should the need arise.  At this point the tenant feels that she will be okay working, and that her financial issues have been compounded by time missed from work due to doctors visits, tests, and what not.

So yes, to sum it up, I have allowed her to stay and am giving her the benefit of the doubt that she can pay.  And I am okay with that (in this particular instance).

Stay tuned Friday to see if she paid.

Update

I talked to the tenant about different charities and church groups that are there to help in these situations.  As it turns out the tenant has already been in touch with a few of these organizations.  She has also been in touch with her HR department in regards to short and long term disability, but that there has not yet a definitive answer from her employer.  One of the church groups she approached is willing to offer rental assistance to bring her current, but not until she is served with a 3 day notice.  So this was the first time I have ever had a tenant ask me to serve them a 3 day notice! 

I want to thank all of you for sharing.  There has been some really great insight, and it is appreciated.  

The situation may be resolving itself, as she indicated her son wants her to move, but nothing has been set.  

I like the comments from @Onna-lisa Kyom and @Patrick L.. For the little bit of time it would take on the front end, it could make conversations like this  much easier.  I can also see how it can help with tenants who are looking for you to provide the hand out in the way of free rent, it is an easy redirect that puts the responsibility back on the tenant.

For the most part, I have been on the "it's business" side when dealing with tenant issues.  And as @John Teachout points out, there can be no end to other peoples unfortunate circumstances, so where do you draw the line.  Perhaps it is fear of the unknown of what cancer is and the facing of one's potential mortality that got to me.  It just seems as if "it's business" falls short when when you realize we are also in the people business.

Again, thanks to all for responding.  It has given me so much to think about, and how to best handle something like this in the future.

I was hoping to get some suggestions from fellow landlords and property managers on how you might approach this situation.

Tenant has been with me for almost a year.  She is nice older lady, that has taken good care of her apartment, kept me informed about the place, and has referred prospective tenants for other units in the building.  She has only been late on rent one time up until about 6 weeks ago.  She informed that she was having surgery to remove a tumor, and that due to the missed time from work, she was going to be short on rent, but would pay half the rent, then the balance over the next 2 pay periods.  I was understanding to her situation and agreed.  She has been unable to bring rent all the way current, but has made payments.  I have now been informed that they have found more tumors, and additional treatments will be necessary.  She insists she can make a payment to get caught up towards the end of the month, and wants to know if I will work with her.

Would you ask her to leave?  And if so, how would you handle it?

Would you work with her?  And if so, how would you structure it?  Where do you draw the line before asking her to move?

Sanjay - Welcome to BP.

You are absolutely correct.  There has been a steep increase in the tax appraised value of property since 2014.  There has also been a steep increase in rents that have gone up with those increased tax values. 

There have been many discussions in regards to the state of the Houston real estate market on BP.  I suggest you do a search of some of the previous threads, there is a lot of good info in there. 

Prices are under strain in the higher end homes. The market for homes over $500k has been suffering for over a year. Places like Katy and the Woodlands have been more effected than places Sugar Land or Pearland for example. Homes under $250k have still been selling at a good pace. This has more to do with FHA financing requirements being eased and the affordability factor. I have said it before, and will again, you can not have the higher end falling and the lower end rising at the same time for a prolonged period of time.

As to the rents - they are down in the higher end homes for sure.  The lower end homes are still renting at a good pace.  Houston is very diverse and the rents will vary greatly based on what part of town you are in.  If rents are softening in an area you are looking to invest in, then make sure you buy at levels that make sense at the lower rent levels.  If you can still achieve your desired outcome at a lower rent than today's price, then buy.  If it doesn't pass the stress test, wait for the next one.  There will always be a next one, so long as you continue to actively look.

A lot of people look at the market and question prices and values.  There are always homes for sale, and you can buy anything you want, pretty much whenever you want.  On the flip side, you can also always find a reason not to buy, no matter the market cycle.  People will always find a reason to disqualify a deal.  So, the question to you is not what you think of the market right now, but what are you looking to achieve from investing in real estate.  If you create an investing box, and a deal falls into that box, will you have the courage to buy it.  If you create the box, are you willing to wait until a deal meets that criteria, or will you jump in because you are frustrated that nothing seems to fit your criteria at the moment.  

Hi Stanley - welcome to BP.  You are in good company here on BP.  There are many great discussions regarding flipping and rentals.  And there are several active investors from Houston that regularly post about the local market.  My advise to all newbies is to focus on one, get that first deal done, then worry about number two.  Best of luck.

We advertise online through our PM software (Rentec Direct), which syndicates with several websites.  We get the most hits off of Zillow, Trulia, and Hot Pads.  Lots of pictures helps with the number of inquires.