All Forum Posts by: Kimberly T.

@Colleen F. I'm sure you'll look back on this story and laugh some day! At least you got it solved (albeit after about 6 months). Maybe this story will make you feel better: my mother and I were staying in a hotel room together once in Las Vegas. We got to our room and heard a beep every 2 minutes; we assumed it was a smoke alarm and called hotel maintenance. They sent a guy up, we all hovered around it, he tried taking the battery out, ... just like you, listening to everything that was electronic, but still heard a beep every 2 minutes. Finally the guy asks my mom if she has a cell phone, she says yes, it's in her pocket. She pulls it out, and right on schedule, it beeps! Turns out she had a voicemail and it was set to beep to notify her, but we hadn't heard the beep earlier because we were in the casino. She was so embarrassed! Apologized to the maintenance guy profusely.

@Kevin Fletcher thanks, yes, digging is tough! My husband and I have done our share just landscaping our properties. I find it interesting that those units are less desirable, is it because people fear that it might get musty/moldy? I would have thought the fact that it's cheaper for tenants to heat/cool (if they pay utilities) would make it more desirable.

Thanks guys!

Yes, grading is crucial, and I suppose we'd have to consider possible water leaks coming through walls. I've heard of products you can paint on the interior side of concrete or masonry basement walls to "waterproof" them, so perhaps that would be one option if there is slow seepage/intrusion.

@Joel Owens yes, definitely have to be careful with flat roofs! My husband and I don't own any flat roofs, but my parents own a complex with flat roofs which had the roof drains plug up with leaves. Water started leaking into the ceilings, so my father went up on the roof and cleared the drains and the remaining water on the roof gushed out through the drains! Gotta keep on top of that. I will investigate repair/replacement costs if we consider any flat roof buildings. We're also considering buying in GA (Marietta, Suwanee, and Peachtree Corners areas look interesting). Saw one of your old posts about avoiding Fulton County (not good for evictions). If you have any thoughts on those areas, or about buying small apartment buildings in general, I'd love to hear them! We don't own any 5+ unit properties yet, but that's our next step.

As I'm investigating other markets to buy in, I am finding some multifamilies (typically 4plexes) where it appears the first floor must be a couple feet underground, based on the fact that the first floor windows are at grade level. I am seeing this specifically in Colorado, where I'm sure the frost depth is at least a foot or two. They were built in the 1970s and 1980s. I'll try to paste a sample pic here:

My question is, what are the potential issues with this type of construction? Would water intrusion be likely at the walls and/or floor? Any additional maintenance issues? Being from SoCal, I'm not used to basements, so I don't know what all the potential problems could be, and what to investigate if we decide to pursue these types of properties.

I highly recommend getting a PM. We own two fourplexes in the Phoenix metro, and have a PM for them. I do not want to think about how many more times we would have had to go out there if we did not have a PM.

Chris, we go by household income (sum of all tenants' incomes). Here in CA especially, it would be near impossible for most low or middle income earners to qualify for a rental on their own, they have to have two or more incomes in their household to be able to pay the bills.

Now, if one applicant qualifies on their own, and they want to have a roommate, you have the option of only listing the qualifying applicant as a tenant and listing the roommate as an occupant. We are doing that for one of our AZ units - girl applied and qualified on her own and wants her bf to live with her. His credit was below our cut off but he does not have any past evictions or felonies, so she will be the tenant and he will be an occupant. You could still list both as tenants, your choice.

As for which applicant to take if you get more than one qualified applicant, it is my understanding that you do not have to take the first one. You can set a time limit and then pick the most qualified. For example, you can accept applications for 48 hours, check them all, then pick the one with the highest income, or credit score, or whatever you choose.

Good luck!

I'm purely speculating here, since I don't know your area, neighborhood, or complex, but it may be related to the fact that you have "the nicest unit in the complex" and your unit is "the largest one in the complex, ... has the nicest view of downtown, and it is the ONLY unit in the complex with actual bedrooms." When you own the nicest place, your lower-valued neighbors drag down your value. This is part of the reason some people don't buy "the nicest house on the street" - they know the neighbors' home values are dragging them down. Basically, if you are the one odd-ball in an area, your value will be affected by the values in the area. This happens the other way too - one crummy house in an otherwise fantastic neighborhood will have a higher value than it really should.

I don't generally put a lot of stock in zillow's zestimates, though.

Regarding the county listing your place as a 2/2.5, was one bedroom added without a permit? Perhaps before you bought it? If so, this may become a much bigger issue (read: problem) for you. You may have to try to get it permitted after the fact, or they may require you to tear it out if it wasn't built properly. If, however, it is a legal 3 bedroom, then getting the county to recognize that might affect your assessed value (read: cause your property taxes to go up), but may also cause your estimated market value to go up as well.

I'm a structural engineer in SoCal, and that seems incredibly low. Granted, I don't do residential, and I don't generally deal with the total cost per square foot (that's usually the architect's job), but from what I've heard, you should expect over $100/sf. And that's bare minimum. Perhaps this guy has some connection to a modular company so he thinks it can be built modular for cheaper? I've designed modular buildings, and they tell me even those run about $100/sf or so.

Do you have any residential property insured in SoCal? When we insured our properties, we asked insurance companies about what they'd expect to pay per square foot for a total rebuild (if the building was a total loss), and based our insurance coverage on that. As I recall, we were looking at around $125/sf or more. You could try calling some insurance companies to see what they estimate rebuild costs would be, that should give you a rough idea. Be sure to ask whether the rebuild cost includes anything foundation-related, I think they usually assume they won't have to rebuild the foundation since that wouldn't likely be destroyed (by fire, etc.).

I think a few people probably worry about prowlers, but I'm sure a lot more value the convenience of ground floor units for moving furniture in, carrying groceries in, etc. We own a one-level triplex and people seem to like that it's ground level, plus no neighbors above (no stomping/noise from above). With that said, I don't do condos since I don't do HOA, but as far as ground level units, I've always heard that's generally a plus.

Excellent answers above. I agree with Marcia, see if you can get signed estoppels prior to closing; that will serve as evidence of what they've agreed to regarding the unit (rent, deposit amount, who owns what appliances, etc.). Then after you close, have them sign rental agreements with you as the landlord. Make it month to month so you can just serve them a notice to vacate if they don't work out as a tenant.