All Forum Posts by: Makan A Tabrizi

I don’t know if it’s a new law but I was told by my PM at a recent move out it was now considered normal wear and tear and you couldn’t charge for it. 

I assume any painter / handyman doing your turnover could do that kind of touch up in almost no time for almost no money.  

Quote from @Makan A Tabrizi:

Quote from @Kevin Sobilo:

@Makan A Tabrizi, I have not researched this ResidentScore but a few things to think about:

1. Someone taking out a mortgage for the first time has NO history of paying a mortgage on their credit score, BUT lenders still believe the score is useful!

2. Even if a score doesn't include a history of everything, if it has enough data it should be useful. Someone who is in their 40s and been evicted 3 times in the last 10 years likely has a poor credit score as well. When you have enough data over a long period of time, there should be enough to generate a useful score.

3. FICO similarly doesn't usually include rental history. So, it wouldn't be using any better data.

4. I use zillow, but I take the credit score with a grain of salt. A good score is an easy "yes", but a bad score is an "ask more questions" in my process.

In my market, I still come across quite a few applicants who have not used credit much (or even at all). So, their credit score may not be indicative of them as an applicant.

For example a 25 y o applicant who has used credit minimally and has an unpaid bill of $50 in collections from when they switched phone carriers may have a low score, but the only negative on their credit is this one SMALL $50 debt. Does that score tell me anything very useful about them?!? Not really IMO. 

 Yes, I use Zillow reporting as a start and look at other factors. If I don't feel comfortable I also give folks a chance to get a cosigners. Thank you for your input.

Cosigners are a whole other thing. In my opinion they are usually of little/no value UNLESS they are "collectible" which to me in most cases means that they own real estate that can be lien-ed with a judgement.

@Makan A Tabrizi, I have not researched this ResidentScore but a few things to think about:

1. Someone taking out a mortgage for the first time has NO history of paying a mortgage on their credit score, BUT lenders still believe the score is useful!

2. Even if a score doesn't include a history of everything, if it has enough data it should be useful. Someone who is in their 40s and been evicted 3 times in the last 10 years likely has a poor credit score as well. When you have enough data over a long period of time, there should be enough to generate a useful score.

3. FICO similarly doesn't usually include rental history. So, it wouldn't be using any better data.

4. I use zillow, but I take the credit score with a grain of salt. A good score is an easy "yes", but a bad score is an "ask more questions" in my process.

In my market, I still come across quite a few applicants who have not used credit much (or even at all). So, their credit score may not be indicative of them as an applicant.

For example a 25 y o applicant who has used credit minimally and has an unpaid bill of $50 in collections from when they switched phone carriers may have a low score, but the only negative on their credit is this one SMALL $50 debt. Does that score tell me anything very useful about them?!? Not really IMO. 

Hello Makan.  I also know nothing about Apartments.com scoring specifically, but I'd probably group the report in with other similar application services like Zillow.  #1 rule is not to trust them, but they still have value.  Much of the information in these reports is self-reported and not verified.  In some areas, I find that the information is exaggerated (applicant lied) to make their application look better

Here's how I use them:  A lot of times, the applicant will self report information that disqualifies them.  I thank them for their interest and let them know they do not qualify.  If the report looks good, We have a phone interview.  If that goes well, I show the property and then I provide them with my own application.  After that is returned, I do a background check through Transunion or a similar service.  If the Transunion report verifies everything, and they meet my other criteria (credit scores, proof of income, background and eviction checks...) then we are good.

In my 15+ years at this, I have found a very strong correlation of credit score and tenant quality. This not only relates to tenant's likelihood to fall behind on rent, but it also corresponds to how well they will treat your property.  I have lost a lot more $$$ to tenant damage than to unpaid rent.  ALL of my major problem tenants happened to have had a average (adults in the household) score below 625.  those with score averages between about 625 and 685 have issues, but generally are manageable.  I've never had a problem with a tenant with a credit score above 700.  With this said, I do consider the situation.  A recent divorce can cause serious credit issues and I've had success with a tenant in this situation.  In another example, a tenant had no credit as he had just immigrated to the US.  He had a tech job and we talked the business and he was legit and when meeting the family, they were very respectful.  This was another great tenant.

Regarding Zillow applications, I differ with Kevin's experience.  In one area I rent, you just cannot trust them; over 50% of them have completely bogus data.  Great resource for advertising your property, but not so great for screening.  They do minimal at best verification of the data the applicant provides. It looks like Kevin's and my markets vary.  I have nicer Class B properties and it is expected that the applicants have a good record.  I put a lot of money into my property to make them nice.  One bad tenant can ( and have) quickly destroyed a year+ worth of profit.

I would never put in a gas range, oven, dryer or any other consumer product for tenants, because a lot of them are idiots and will kill themselves or someone else. Virtually everyone has used an electric range or oven in their life but lots of people have no experience at all with gas anything. 

I would go with a combo W/D unit just like @Greg M. mentioned above. It will be a little trying for 6 units to use - they're slower because they do both washing & drying - but that would be way better than expecting tenants to drag wet laundry around. If you are saying that you have room for one in each unit, I'd do that for sure. You can get combo units that are 24" wide and fit under a countertop so they can go right in a kitchen setting. 

I think putting in a washer without a dryer would be jarring for people and perhaps make them think there are other things missing. For people who don't want to hang it, then they need to take wet clothes to the laundry room. 

Consider putting in a combo washer/dryer. They're about $2K, but in-unit W/D is the most requested item I hear.

4 burner gas top should be OK. If they want an oven, they can get a table top one for under $100. I have a Breville (around $300) and it's big enough to cook a full size pizza or whole chicken, it toasts, has convection ability. Perfect for anyone in a small place or who doesn't want to fire up a range.

@Makan A Tabrizi Check with your insurance as I’m not allowed to have gas stoves or ovens. The insurance company says it’s too much of a fire hazard.

I do try to get a full size stove and ovens in any unit possible as opposed to the smaller apartment sized ones.

My tenants all love having a washer and dryer. It’s a huge renting point and can help you get bigger rents.

In small spaces I have occasionally put stackable ones. If you get front loading units tell each tenant not to overload the washer because it will cause the seal to give and make the unit leak. I learned this the hard way personally and had to get mine repaired. I told subsequent tenants this once I moved out of that unit and have never have had a problem since.

Quote from @Makan A Tabrizi:

I'm renovating a studio apartment with limited space. Any input on the appliances noted above would be appreciated. I didn't list ventless dryers as I haven't read very many good things about them. I used to have one many years ago and it never got very hot.

Include an oven...even studio apts like to cook a turkey once in a while....
And I wouldn't have a washer without a dryer (if that's what you're thinking?) Do you have to have ventless? No other way to route the vent? Still, any dryer is better than none...