All Forum Posts by: Jon Coleman

@Donald MacMillan It is certainly a tough situation.  You want to ensure your investment is generating reasonable income but you also don't want to impose undue hardship on long-term tenants.  I agree with many of the folks on here talking about having conversations with the tenants and presenting them information about rates in the area (such as those from Rentometer).

Doubling rents would likely be devastating for most tenants but a stepped increase to get rents up to near market numbers over the course of a few years should be a reasonable balance.  This could give the tenants more time to adjust and plan.  Reinvesting some of that money into improvements that will benefit the tenants might also help take the sting out of it.

It may also help for you to run the numbers on a few scenarios if you haven't already.  See what it'd look like if you maintained current rents, took a stepped approach and brought them immediately to market rent.  I'm sure the latter would look the best on paper but it'd be helpful to know what your margins are on the other scenarios and to see what makes the most sense for both you and the tenants.

Best of luck!

@Katie M Reece From what I've seen, you want to be particular about which options you use as you need to be able to have more control over accepting funds.  What I mean by this is that if you have a tenant you are in the process of evicting due to nonpayment and then they send you a dollar through something like Venmo/Zelle you risk resetting the clock by accepting the payment.  By going with something geared towards rental properties, you should be able to have more control and avoid situations like this.  As @Kynan Bush suggested, I've also heard RentRedi recommended by others.  

@Greg M. Good call on chain link.  Since the current storage is 2x4s I was running with that mindset but there is no reason I couldn't do chain link instead.  I'm not sure what the cost difference would be but certainly seems worthwhile to check out both options.  I also hadn't considered fence weave but you are right that it'd be a fairly inexpensive option for privacy so it isn't as easy to tell what tenants are storing (and likely improve their sense of security for their possessions).

I'm guessing the biggest challenge I'll have with this project would be potential resentment from the tenants.  It seems like they weren't really supposed to store anything in the general areas of the basement but that they did so without consequence, so now taking that space away and only offering it with a fee could go over poorly.  If I can build the storage spaces inexpensively enough, however, I'd think I could swing a fairly low monthly fee for use of the space.  Letting the tenants know they can also consider using the Public Storage up the road for a larger fee may help make it seem more reasonable, too.

@Kevin Janssen I considered taking on part of the upkeep myself but handling the snow in particular would be tricky given that I'm not nearby and based on my day job may not be able to get there in time to clear it.  I don't mind paying for the service but was shocked when the quote came back at nearly $150/visit it just didn't seem feasible.  

I'm open to paying a tenant to taking on the work but would like to get to know them a bit better first.  I'm concerned about reliability and the liability if they don't do it (or do a poor job) and someone slips.

I realized that there are a lot of other 4+ unit properties right near this one so I'm going to try and get in touch with the PMs to see about using the same services they do in the hopes we can both get a break on price.  I've been having a surprisingly tough time figuring out who the PMs are unless they have a vacancy but I figure if I drive out to the location they might have signage.

@Kevin Janssen My initial plan was to completely forbid smoking in the building as well as a specified distance from outside the building (to prevent people from sticking their head out of the window or standing just outside their door) but I hadn't anticipated getting a property with tenants who've been allowed to smoke indoors for years.  I just assumed the vast majority of property owners would strictly forbid indoor smoking given the damage, nuisance, liability and the like.

I'd seen a suggestion on one site to set up a specific spot for people to smoke and make it an appealing option.  The suggestion was to provide some form of covered seating area so the tenants would be more likely to use it and less likely to smoke in or near the building.  My concern is that I'll invest the money and effort but the end result will be tenants continuing to smoke in or near the building anyways.  

You mentioned that you work in insurance and have seen many fires due to smoking indoors.  Do you know if there is a premium paid for allowing indoor smoking? 

@Damien Lee Congrats on getting ready to take the plunge!  It is good that you've been able to narrow down budget, property type and area.  While I've seen a lot of people interested in investing in Milwaukee, they are most often from the Bay area since it isn't practical to invest there due to extremely high property values.  I wouldn't have expected the same from Atlanta since I'd always thought that was supposed to be a more affordable city if not other parts of the state (Savannah or Athens).  What made you decide to pick an out of state city you've never been to over options closer to home, especially for your first property?  I'm not overly familiar with the real estate market in Georgia, although it seems like many parts of the country are seeing big rises in home prices lately.

You mentioned wanting to get used to the flow of being a property manager.  How much of the property management are you planning to do yourself given the distance?  

To learn more about the Milwaukee market, I'd highly recommend Marcus Auerbach's YouTube channel.  He has a variety of educational videos that are very beneficial for folks interested in purchasing properties, including rentals, in the greater-Milwaukee area.  He has videos dedicated to the different types of duplexes in the city, the best neighborhoods, and detailed updates of the local market with lots of stats.  He is also very active on the BP forums and you can see a lot of the valuable insight he shares on the Milwaukee Real Estate forum.

@Patrick M. I appreciate your advice and insight!

@Patrick M. I'll see if I can get in touch with the owners/PMs of the neighboring properties to discuss using the same vendor.  I'd much prefer a flat seasonal fee over per visit billing to make the expenses more predictable.

You bring up a good point about not having the vendor come out if it is under a certain amount.  The first quote I received was very granular and had fees broken down per inch, including visits with snowfall of a fraction of an inch.  When the snowfall is under 4.5 inches, do you still have the walkways done or do you skip it altogether?  Thanks!

@Patrick M. Thanks for sharing your thoughts!  Unfortunately the city does not plow the alleys and seems to just leave it up to the owners/residents to shovel (or not).  My last house had an alley and in my experience it was pretty mixed if people would clear their section.

I don't plan to charge anything for parking.  Finding parking doesn't seem to be an issue for this specific area so it doesn't have the same value add it might in places closer to city center.

A number of the properties off the alley are also MFHs but I'm unsure if those landlords have a plow come through to take care of either their spots or the alley itself.  It seems like one approach I could take would be to reach out to those owners/property managers to see about using the same service they do.  I imagine it'd save us both a bit in costs, would be more efficient and could be a benefit to all tenants if it means the whole alley will be plowed (as opposed to only parts of it being cleared).  

For your snow removal, do you pay per visit or per season?  Thanks!

I'm curious if you all tend to have off-street parking plowed. I'm purchasing a property with about 5 paved spaces off an alley so the only thing the service would clear would be the spots themselves.  If tenants are parked there, the plow won't be able to clear much, so I'm questioning if it is better to just limit the services to shoveling/salting the sidewalk, walkways and stoop.  What have you done for your properties?