All Forum Posts by: Katrina Cabral

Not sure I understand. Im selling a SFR in Georgia for about $150k to add a rental unit above my garage onto my $1.6M house in California. Land value is much higher in California. Would the exchange work? And am I limited to 180 to build it/complete it? Maybe I should build it first?

Can I sell my property in Atlanta to build a rental unit on my existing property? And would it qualify for a 1031 exchange?

I have a family of five with three small children, father is in a wheel chair, living in a 2 bed, 3 bath SFR in Georgia south of Atlanta. They have been living in the unit for a year. Paying on time. Gave notice last June but could not find a place so did not move out. They do not have great credit and I discovered has one criminal offense recorded.

I had the place listed for $1,300 - they were paying $1,100 - and they agreed to pay $1,200 going forward. It was a relief that they stayed as I didn't have to show the place or clean it up to market it. I did have a couple potential tenants walk through it when it was listed and the feedback that I received was that the condition of the place was appalling. It's not clean or well kept and there are marks all over the walls from the wheel chair. 

It's hard to say that there is a 'trend' because they have only been in there a year - but it seems like this family has a maintenance request every couple of months. I have stopped paying for clogged drains but because he is disabled he can not do even the simplest of fixes. Not that I'm not sympathetic and I'm grateful not to be in his shoes but it can get expensive. 

After I agreed to let them stay another year, they said that they would need to make modifications to the residence - widen doorways, and remodel the master bathroom shower. I understand that, by law, they are allowed to but must return things to their original condition upon moving out. This seemed overly burdensome and expensive so, in an attempt to provide some relief, I offered to pay for materials if they would upgrade the project and make it 'nice' vs utilitarian. So that it might appeal to the next tenants/resell value. Originally, they said that they had a handyman friend that would do the work for free. They are planning to do the basic job - not the nice one - and they still want me to pay for materials. Originally, I offered them a budget of $600 for materials. I'm out of state so I will not be able to oversee the project, quality of work, or even the final product. 

In the past year and a half, I have spent over $20K putting on a new roof, exterior paint job, and it has a new HVAC. 

So, I sent them a reply that I'm not in a position to go above and beyond on this bathroom remodel and that they are welcome to proceed with the basic plan at their own cost. Awkwardly as could be expected - they are disappointed that I'm not willing to provide them with the $600 funds to do the project - (shame on me for ever offering). He responded by saying that they may need to give notice and move out if I don't pay the $600 for materials. 

I'm conflicted: 

I don't want unhappy/resentful tenants, they have paid on time for 14 months, (no guarantee that will continue), on the other hand - not looking forward to more maintenance requests every couple months IF they continue, I'm concerned about the wear and tear on the place that this family of five is doing, I could potentially be getting an additional $100/month if they move out, or I could sell it but it's a bad time of year to sell. Not confident about how long they will stay considering that I know it's not a good fit given the steep driveway with his wheel chair and the only reason they are still there is because they could not find another place. On the other hand - I could have them for years if they can't find a better place.  

Thank you for reading - it was a lot of history to ask the question - would you pay the $600 or not?
 

Good points. Thank you. I have been doing things that way but it’s a lot more work. Maybe only because it’s the beginning and once I get a team I can count on them it will be easier. 

I have had some pretty bad luck with PM's in the Atlanta area and I'm ready to give up. Other investors have suggested getting a home warranty company to handle repairs and maintenance. It sounds good to me and so I was wondering if others here could chime in with their experience with this and companies that they recommend? Any comments or suggestions would be appreciated.  

@Jim K. seems like the consensus is that it isn't expected to be included then? Seems odd to me. A glazier will likely be as much. I'm cycling back to the other paint bids to see if it was included in their bids. 

His estimate included - "Remove old caulking around the house that's coming off, caulk any openings on the fascia, soft, trim, etc." Should this include caulking around the windows muntins? He texted me stating that the windows need 'glazing' and when I asked if I needed a glazier he replied that he does this and "it's just like caulking but material is caulking window glazing". (?)

I got three bids for exterior painters. The one that I went with was the most expense, (22% more expensive than one and 62% more expensive than the lowest bid). His estimate was the most thorough of the three and knowing that the house needed a lot of work - I didn't want any surprises. Half way into the project, he texted me a photo of the wood window muntins noting that each window needs caulking/glazing around each of the wood muntins. This is an additional $45/window for 16 windows or $720 extra.(!) Seems outrageous on many levels. I have no problem paying a man for an honest days work but something seems really off . . . he is half done with the exterior repairs. Has not started painting yet. Has not started on the muntins yet. 

I want to contact him and say "Never in my experience hiring an exterior painter have I ever encountered such an oversight in the estimate." And ask what's going on. I want to hold him to his estimate. . . $45 a window seems like steep wages for outside Atlanta. Does this sound like a scam? Can he put a lien on my place?

Thoughts? What would you do?

@Michaela G. thank you! That is a wealth of information. I did get the info from the tenant. So, your right I should take it with a grain of salt. 

Yikes! Thank you @Tom S. and @Nelson De la Torre.