All Forum Posts by: Lee L.

I have a multi-unit property under contract right now in the city of L.A., a city that has rent control. The property has ample parking spaces but the leases do not designate parking spaces for each of the units. Either before I take control of the property, or once I own the property, I'd like to designate parking spaces for each of the tenants, saying that each unit is entitled to only 2 spaces. 

How would I go about doing this? Do I take the issue up during contingency, or is creating these new rules a right I have as the owner, provided that I follow the lease? 

Another kind of related issue: one of the units has a fence that sort of separates itself from the rest of the property. Although I have no plans to take down the fence, I want this part of the property to be freely accessible by myself and the other tenants.  The lease does not say anything about the tenant having exclusive access to the area. 

How would I go about doing this? 

OK...I think I'm officially scratching San Bernardino off the list.

There's a 4plex that I'm thinking of purchasing but I suspect the listing agent is trying to double end the deal. He was keen on talking to me earlier in the week when the property first came to market. He said there would be a showing on Saturday, but never confirmed an exact time. He also asked if I was working with an agent, and I said yes, I'd be representing myself since I have a license. I texted and called him on both Thursday and Friday trying to confirm a time, but he wouldn't return my call. Then 10:00PM the night before the showing, I get a text from him saying the showing had been rescheduled to Sunday or Monday "because of multiple offers." WHAT?! What kind of reason is that? After his response, I submitted an offer the next morning well above asking. It's Sunday night now, almost 40 hours after I submitted the offer, and ... crickets! I feel pretty frustrated and completely slimed. Is this what it takes to get a hot deal, to let the listing agent double end the deal?  

Beautiful job! I love your resourcefulness. The shower, floors and cabinets turned out great!

explore umbrella policies. It goes over and beyond your homeowner policy. I have $1.5 million personal liability coverage.  Just a few hundred bucks a year for extra peace of mind. 

Talk to the tenants if possible. Find out what kind of issues they have with the property (ie: leaks, hot water, termites, rats, noise, crime, what they think about the other tenants, when their last house call/repair was, what parking storage/storage goes with which unit, etc) You can get a lot of insights and points of further investigation this way.   

@Account Closed I tend to evaluate the building apart from the area. So you can have a "C" building in an "A" area, or an "A" building in a "C" area. "A" areas will be typically populated by "A" buildings, and so on and so forth. "A" areas are typically in the nicer parts of town, with residents that have higher incomes, and higher rents or property values. "B" areas are nice, safe and perfectly livable -- sort of middle of America, and the average person probably wouldn't mind living there. A young lady probably wouldn't mind walking their dog alone in a "B" area. "C" areas aren't very nice at all. Significantly lower than average incomes, low property values and rents. A lot of aggressive dogs, unkept yards, and higher crime. "D" areas are warzones. Notoriously high crime. Gangs. A lot of people standing around. 

Property taxes are a major component of expenses in real estate. Today I found this article from Mansion Global that shows the latest numbers from CoreLogic comparing the property tax rates throughout the country on a $2 million home. Check it out: 

If anyone would like to chime in on any nuances of their state's property tax policies, feel free to chime in. Here in CA, we have Prop 13, which has been a huge boon to property owners. In very simple terms, it sets a 2% limit on annual property tax increases, which is pretty awesome.

@Sam Nichols Watch a few episodes of COPS and you can see what can go wrong. It might involve way too many people living there, plenty of roaches and rats, tons of deferred maintenance, dirtbags, some type of drug, and a prostitute or two. There are people who are successful with them, but they have systems in place and have scale to take care of these things efficiently. 

Be pretty certain that you can hold onto the property for a while in a 5+ unit property. Unlike a conventional loan for 2-4 unit property, on a commercial loan you will likely pay a prepayment penalty if you are forced to sell or refinance early. 

I kind of see 5 unit properties as no man's land. You can't get a conventional loan (thus narrowing your pool of potential buyers if you choose to sell) but your economy of scale is just slightly better than a 4 unit property. However, one of the main advantages of a commercial loan is that it looks at the cash flows of the property itself, not the income of  the of the buyer.