All Forum Posts by: Krystal Baker

Hello all!

I'm struggling with a location dilemma, and my husband suggested I ask "that real estate website I'm always reading" - so here goes!

I currently have 5 properties in Kansas City, and 8 in Dayton, OH.  I live just south of Dayton, but am new to the area (almost 1 year now).  I'm ready to buy more, but am worried about getting too heavily invested in one city.  Is that a silly concern?  The area is stable, at least I think it is, and I'm buying in good, solid A/B neighborhoods.  

What do most of you do?  Spread it around, or keep it local?  I know this market, and I know I can continue to make money here, but just as I wouldn't own only one stock, I feel uneasy about owning real estate in mostly one city.  That may not be a good comparison because a city can't really fail as spectacularly as a company' stock, but you get the idea.  As I'm transitioning from doing this as a hobby to making some serious money, I'm trying to make sure I do it the right way (if there is any "right" way).  

I appreciate any input that you all  have to give.  Hopefully I'm just overthinking this, and will keep buying here.  But, I'm not opposed to branching out, and there are other good markets relatively close to me (Indianapolis, Cincinnati, Cleveland, etc.)

Hello all,

I have a property that was vacated on April 22nd.  Not trashed, no eviction, the renters simply decided to move to another part of town, and left the property in reasonable condition.  The same day they moved out, my property manager e-mailed me pictures of the now-vacant property, and said the bid for any "Make-Ready" items (paint, cleaning, yard, etc), would be coming soon.  Now, it's almost a month later, I have contacted her twice already, and she keeps apologizing and saying the bid is coming.

Time is quite literally money here.  What does the community think is reasonable?  If I haven't even received the estimate yet, I know the work hasn't started - how long is this property going to sit?  I have a good relationship with the property manager, and she has been responsive in the past.  I have 3 other properties with the company as well, once of which is behind on rent any may be vacant soon as well.

How long do your properties sit between tenants?  For my local rental properties, I never let them sit more than a week or two before they are back on the market and making me money.  This property is in the Midwest, while I'm in California.

Advice?  Thoughts?  I have clearly told her that this is a problem for me, and she is just not responding the way that I would like.  At the same time, I hate to switch when this is the only issue.

Have you considered P2P lending? I am never able to get conventional loans for the $45k properties I buy, so in the best I have used LendingClub, Prosper, and BestEgg to get the funds I need. The downside is that it's a 5 or 7 year loan instead of 30, of course. I usually pay around 10%, which isn't great, but isn't as bad as a HML with points, either. If I buy a $45k property with $10k of my own money and a $35k P2P loan, there is still plenty of money for me to turn a profit.

Not a strategy that's going to make you get rich quickly, and I'm sure Brandon and some of the others would be horrified at the idea of using your own money, but it's better than sitting on the sidelines and waiting for a loan!

Going forward, we will definitely be using an alarm system for vacant houses. Its one of those things that doesn't seem necessary until a situation like this happens!

I guess something like this was bound to happen eventually, but I had hoped it would be ten years down the road when we had more cash on hand to comfortably weather the storm.

It's an OK area - not the best, but not a war zone either. I have other properties in the area that have sat vacant for weeks without any problems. But you're right, the opportunity is always there when people can see that the property is vacant.

Probably just bad luck and bad timing.

I've never had damage so bad that I've had to file a claim before - does this mean that rates will automatically go up on my other properties?

Bryan - thanks - we do have insurance, I guess we'll find out soon how good it is!

Jon - not sure if they total houses either, but i do think the damage will be about the value of the house, so maybe. I'm sure I will find out in the coming days, unfortunately.

Michaela - the walls are the most annoying part of the whole thing, and yes, they were copper wires. The timing of the whole thing does seem like quite the coincidence to me, too.

I am a fairly new investor, and just got a call from my property manager in Kansas City (I'm in California) that the house is destroyed. The property was between tenants, and the manager was there last night to make sure everything was ready for the move in today. When they showed up with the new tenants for the walkthrough today, they found the house is trashed.

All piping and electrical gone, appliances gone, furnace/AC gone, every wall ripped open, flooring destroyed, bathrooms down to the studs. Furnace was still in the living room along with some other things, so they called the police and left - the police are currently waiting in the house, hoping the guys come back.

I'm just sick about this. I've dealt with vandalism, but nothing on this level. They are saying $20k in repairs for a $35k house.

Any ideas? Property manager said that this is the worst she has ever seen a house destroyed, and apparently they did it all in one night.

Property manager is going to contact the insurance company today, and the police say that there are enough fingerprints that they will likely find the guys - not that it will help me any!

Looking for any advice - thanks in advance, guys! Rough day....

I definitely agree to drive the neighborhood on the weekend in the evenings. I also like to drive the areas around 2am - for me, if there's a lot of activity in the wee hours of the morning, it's a sign of a rough neighborhood.

That said, I agree with @Account Closed - the 30's and 40's are far rougher. I'd say below Volker/hwy 56, though, there are some good opportunities. Also, in that area, beware of "remodeled" houses that have bad bones. I've seen quite a few with great looking interiors, but evidence of past flooding in the basement, bracing issues, etc. Lots of flippers trying to make a buck in KCMO right now!

I would ask the potential tenant which rules they have a problem with - my guess is that they won't actually find anything objectionable, and just sign. As for holding the property, you said it - lesson learned.

Jared Adamson - It does look like we have the same plan! I ended up in Kansas first and foremost because the numbers look good, but also because I have family in the state, and am at least a little familiar with the area. Before my husband and I made the final decision to buy, we also went to Kansas City for a week, to get a better feel for the different neighborhoods and areas and make the appropriate connections with Realtors, property managers, etc. I do think Florida has some great opportunities, but we are buying in cash at this time, and most properties there are out of our league! Texas certainly has promise, too, and after we accumulate a few rentals in Kansas City, I do intend to look into Texas further. Our property is turn key, and already rented. You certainly give up some cash flow doing turn key as opposed to a fixer, but as an out-of-state investor with a regular day job, I just felt more comfortable doing it that way.