All Forum Posts by: Adam McCullough

Welcome!

I'm currently living in Minneapolis but have had property in CR for a couple years now. I've had one bad experience and a great experience. Let me know if you have any questions, I'll do my best to help!

Be sure to screen tenants, can't emphasize it enough.

Wish you the best!

Thanks for the responses!

This will be a flip with the option of renting if need be. I would auction it up to 50k and list it at 100k. Rent is 1k a month with a $100 association fee.

Probably needs 10k -15k in work and advertising.

Hi All,

Background

I bought a townhome in Cedar Rapids, IA a little over a year ago. I lived in it for several months before a new opportunity came up and I moved to Minneapolis. Since then, I've rented the home. As some of you may have seen, my first tenant (put in by a management company) was not great, in fact they were horrible. I've since evicted the tenant and cleaned it up and got some new tenants in that seem to be great (I'm now managing the property). I'm currently in the process of getting myself licensed and will soon be attending a required Landlord class.

Property Details:

When I bought the property, the one next door was in foreclosure. In the last few months, activity has increased. It was recently listed. I met the Realtor helping the bank clean up the property and sell it. I've even had the opportunity to walk through it after the cleanup was complete (new carpet, fresh paint, patched up holes, general cleaning). Its been on the market for several months but they must not have had any luck.

Question:

The property is now in auction, beginning at half the value mine was recently appraised at. The two are identical properties, however, it has no appliances and has not been lived in in over a year.

What should be done to seriously look into this property and asses whether its an opportunity or risk? What has been your experience?

Unfortunately, I have only 4 days before the auction is complete. Sometimes things are too good to be true, but I think its worth looking into. Let me know what additional details you might need.

Thanks!

Adam

Thanks Mathew!
Mathew Wray

Hi All,

I recently began renting a townhome in Cedar Rapids, IA ( I now live in Minneapolis) and I just went through an eviction. The place is slowly coming back together, but thanks only to my parents, as the property management company has stopped responding to emails and has made no effort to help get the place cleaned up (its been two weeks now). I will of course call them tomorrow, but unfortunately, this is not the first time that they've not responded and generally when I call, I'm told that whomever I need to speak with is out of the office or can't talk.

Ultimately, I'm trying to get a hold of them to
A) Release the deposit they're holding
B) Have them repair an oven door that was shattered (I've been told they bought the part already)
C) Get the lease and any other information I will need to take the tenant to court for repayment of repairs and stolen items
D) Break the contract ( 6 months remaining)

Do you all know, can the company legally hold on to the deposit and any documents related to the lease up of the property? Is it worth it to consider building a case against the company, I believe there may have been negligence in how they screened the tenants but probably tough to prove?

Any thoughts, comments, suggestions are appreciated.

Thank you!

Adam

Thanks for the welcome and all the advice!

With regard to fixing the house up, I do hope to do as much as I can on my own. I'll probably let the management company handle some because of the distance (property is four hours away) but I hope to take on as much as I think I can handle in one weekend. I imagine there will be a considerable amount of cleaning and painting that needs to be done to get the place up and running again.

Mark - we should definitely meet up for coffee sometime. At the moment, I'm focused on this one property but do have some interest in moving on to others if I can cashflow the property I currently have.

Mehran - I will definitely ask to see the tenant application in this go around. Unfortunately, I feel like I'm the one orchestrating the effort, not the other way around. I thought that's why I hired them. Is this usual for a management company? One of the Podcasts mentioned staying on top of your management company which lead me to believe others must be having the same type of issues.

Thanks again all!

Hi Brandon,

Thanks for the heads up, I went ahead and set up a Keyword alert and read through the Beginners Guide.

Regarding the property, its difficult to say. Its a complicated situation involving drugs, the separation of a married couple, and a boyfriend who seems to have been a bad influence. The guy who signed the lease never actually lived there, but he did put his wife and two kids down on the lease. The wife moved in with a boyfriend, I believe the guy who signed the lease had a solid background.

So I have a hard time blaming the management company on that end, but when things began to blow up, the management company did not communicate with me well at all making for many restless nights. Most of my information was fed to me by a neighbor. The management company seems to be withholding information from me as well, I'm not sure what they can withhold and what I can request / demand they provide. I.e. I know pictures were taken of the property after the police were in the property after a break-in but when I requested the photos, they told me I would get pictures after the tenant is evicted.

At the end of the day, I'm not ready to bail on the property but I'm not confident that this is the right management company either. I'm not sure if I can/should break the contract with them or not. My only reason for staying is that after going through all of this, I know how they work and I know who the right contacts are.

Still a lot to learn,

Adam

Hi Joel,

Ultimately, my goal is to one day own my own business and I hope to use this investment as a stepping stone. I'm not sure if this is my niche or not quite yet, but I certainly have an interest in it and will continue to grow my investments where there is opportunity.

Ultimately, I'd like to start my own business, I'm investing in both stock and real estate to create a base that can help support me when the time is right to move away from the corporate world and become an entrepreneur. While I have this vision of owning my own business, I've not yet found my niche. It's most likely in investments of some form, as that's where my true passion is. That said, I've got my eyes on a few franchises as well, but they all require capital and I don't have much.

In the near term, I'm focusing on my MBA (not sure if that's the right call or not given the cost of an MBA and the additional debt burden I'll have to take on), but I don't yet have a solid grasp on how to move forward with a new business either. I believe real estate can provide the stepping stone I need.

Thanks for your reply!

Adam

Hi All,

My name is Adam, I'm a financial analyst that recently moved to Minneapolis from Cedar Rapids, IA. I've always been interested in investments, I got my start in equities, but grew interested in real estate after working for a company with a large portfolio of commercial mortgages. Thus, when I bought my first condo in Iowa, I bought it with the expectation that I would one day try to rent it. Little did I know that a new job opportunity would present itself in Minneapolis less than a year later and give me that chance.

Now living in Minneapolis, I rent my condo unit in CR through a property management company. It took some time, but a tenant moved in February, unfortunately, the tenant and her boyfriend have been nothing but bad news. An eviction is planned for next week due to non-payment and an assortment of run-ins with the police.

Not sure what the cost will be to get the place cleaned up and back on the market (doors broken in, glass in the oven door shattered, possible drug use), but I do hope to try again and learn from the lessons of this first experience.

I look forward to speaking with you all in the future! It seems like a great community, I'm glad I stumbled across it.

Live the dream,

Adam