All Forum Posts by: Mark Pijanowski

We placed a tenant (Military family) at my property in Germany about three months ago. I used my team to conduct the turnover, and at the time the only condition that they had was to replace (some very outdated) carpet. Since I wasn’t present at turnover there were some minor differed maintenance issues that I didn’t take care of myself. I travel back to check on the property every 2-3 years...my team takes care of the major issues as they arise.

After a month, the tenant’s wife found some other “issues” that she wants fixed. (DISCLAIMER: the tenant’s wife is an architect). Some are reasonable, but in my opinion, many are not...looking for some input on what you guys think.

Reasonable

1. Wasps in attic

2. Power wash and re-sand the driveway pavers as weeds are pushing the pavers up in some areas.

3. Minor dripping at kitchen sink faucets

4. Re-grout showers

Unreasonable/Unsure

1. Update the kitchen countertops; there are very minor chips in the laminate and some of the gaskets around the back wall are missing or old.

2. Retile the kitchen due to some settling cracks (but nothing protruding or creating sharp edges)

3. Kitchen cabinets have very minor cracks at the base, not impacting the operation of the cabinets.

4. Baseboards in living room doesn’t join completely flush.

5. Install a brand new fence. Previous tenants had dogs and installed a fence with permission (they did a bad job, and rigged the fence together with zip ties in some areas, but the fence still functions fine).

6. Re-seed the grass; the previous tenant left large objects in the grass that killed off some large areas.

Lastly, we planned to remodel the kitchen after these tenants moved out. The kitchen/dining/family room are connected with an open floor plan. We planned to redo the floors after these tenants moved out as well. The average family stays 3+ years.

My tenant plays an active role in getting quotes and material prices for the projects she wants completed. I’m tempted to do many of the renovations while they’re in the unit, which would help dramatically reduce turnover the next time, but really trying to decide if I should wait 2-3 years or start slowly doing these renovations, since I know they’re needed...eventually. My concern is if I start renovations now, the life cycle replacement on these items starts ticking once they’re installed vs if I wait a little longer.

I have a really good tenant, the AC in her unit broke; water leaked and caused some minor warping of the hardwood near the register.

My question is, she reported it when she said she noticed the flooring was warped. Should I deduct it from her security deposit? I’m almost certain she’ll stay another year or two.

She hasn’t asked to get the floor fixed, and not sure if I should chalk it up as fair wear and tear.

Thoughts?

@Geordy Rostad

Thanks for your response, I’m grateful for the info. This will certainly help shape my thought process.

My wife and I will continue to mind map out our plan and compile a proposal. I think we’ll need a hard money lender, but that remains to be seen.

I was doing some research and I came across an auction for a piece of land in a well developed community in Colorado.

If I win this bid, I’m looking to either wholesale the property or partner with a developer. The lot sits directly in the middle of a development, surrounded by other subdivisions and access to the existing infrastructure.

As I have little experience with either of those options listed above, I’m just looking to connect with someone who can help guide me. I’ve got a call with the agent tomorrow, and I have plenty of questions.

This is my shortlist:

1. What is the Zoning on the Property?

2. What is the Annual Tax Obligation (other holding costs)?

3. Supposedly public utilities are available (if I don’t develop the land, do I need to set them up if they’re not already established)?

4. Are there usage restrictions (the property is currently used for agricultural purposes)?

5. Do I need a perk test? I’m tracking that the property has access to the city sewer system.

6. Part of the property has wetlands on it, not sure how much...Is that a show stopper?

7. I won’t be able to put eyes on the property, but has anyone used WeGoLook or do you have a similar service you can recommend?

8. Once I determine the zoning, do I need to order a Phase I Environmental Report? How adverse does agricultural land impact rezoning?

Well it’s not all that short, but if I’m missing anything...please feel free to share!

- Mark

Did I miss anything?

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Richmond.

Purchase price: $190,000
Cash invested: $1

Utilized the VA Home Loan to purchase a Duplex. Fulfilling the residency requirement and moving in tenants.

What made you interested in investing in this type of deal?

I wanted to jump back into another deal. Buy and hold is my go-to choice. Between being a new father, going to grad school, and a full time job, I wanted something somewhat turnkey and fairly passive.

How did you find this deal and how did you negotiate it?

Worked with my mentor's real estate agent. Negotiated down 20k off original asking price.

How did you finance this deal?

VA Home Loan; No money down

How did you add value to the deal?

We purchased from your traditional slum lord, so it wasn't hard. We inherited one great tenant and one bad one. We cut the bad one loose. Fixed up her unit (paint, carpets, etc.). Authorized a few small projects that our good tenant wanted to complete, refinished the bathtub, sprayed for pests/bugs, and cleaned up the outside of the property.

What was the outcome?

Despite coming out of pocket $2k to turnover the tenants, it was an overall decent experience. We put no money down to close, so we're not disappointed at all. The property currently has a new tenant downstairs, and we cashflow about $80 a door. Not a huge amount, but considering we're all in for $2k, thats a 96% ROI...haha.

This was our second deal, also a no money down, turnkey deal. Future deals will focus on BRRR'ing and stacking, so much to learn before we attempt our next deal.

Lessons learned? Challenges?

If at all possible, do not inherit tenants! We got lucky with one and no so much with the other. We still overpaid for the property, but my agent was also representing the seller. The seller had about 10 other units he was offloading, and I allowed the agent to smooth talk me into paying about $10k-15k too high.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Richmond.

Purchase price: $190,000
Cash invested: $1

Utilized the VA Home Loan to purchase a Duplex. Fulfilling the residency requirement and moving in tenants.

What made you interested in investing in this type of deal?

I wanted to jump back into another deal. Buy and hold is my go-to choice. Between being a new father, going to grad school, and a full time job, I wanted something somewhat turnkey and fairly passive.

How did you find this deal and how did you negotiate it?

Worked with my mentor's real estate agent. Negotiated down 20k off original asking price.

How did you finance this deal?

VA Home Loan; No money down

How did you add value to the deal?

We purchased from your traditional slum lord, so it wasn't hard. We inherited one great tenant and one bad one. We cut the bad one loose. Fixed up her unit (paint, carpets, etc.). Authorized a few small projects that our good tenant wanted to complete, refinished the bathtub, sprayed for pests/bugs, and cleaned up the outside of the property.

What was the outcome?

Despite coming out of pocket $2k to turnover the tenants, it was an overall decent experience. We put no money down to close, so we're not disappointed at all. The property currently has a new tenant downstairs, and we cashflow about $80 a door. Not a huge amount, but considering we're all in for $2k, thats a 96% ROI...haha.

This was our second deal, also a no money down, turnkey deal.

Future deals will focus on BRRR'ing and stacking, so much to learn before we attempt our next deal.

Lessons learned? Challenges?

If at all possible, do not inherit tenants! We got lucky with one and no so much with the other. We still overpaid for the property, but my agent was also representing the seller. The seller had about 10 other units he was offloading, and I allowed the agent to smooth talk me into paying about $10k-15k too high.

@Brian Garlington

Most of the bases around Mannheim have closed if I’m not mistaken. k-town, Wiesbaden, Stuttgart, or Graf would be your best bet.

@Tobias Stoll thank you, I was financed through a Raiffeisen bank branch in Bavaria.

I couldn’t believe it when I was told they would finance the amount that they did. I am active military, and I assume that may have had something to do with it...not because I’m American, but defaulting on the home would mean catastrophe for my career and I’m certain they know that.

I’d be happy to share more with you, feel free to contact me PM or at my email (mark.pijanowski@ gmail.com

@Brian Garlington no, over in Vilseck. I’m doubtful the bank would lend outside of Bavaria.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $295,000
Cash invested: $500

The home is located in Germany.

What made you interested in investing in this type of deal?

A co-worker of mine did two deals in Germany, and let me know that it was possible.

How did you find this deal and how did you negotiate it?

Worked with a German agent, the seller was American and wanted to get out of the deal quickly. We knocked off 25K from his original asking price.

How did you finance this deal?

110% financing via a local German bank.

How did you add value to the deal?

I didn't have to, we bought at a great price. The home sells (rents) itself.

What was the outcome?

Very positive. Only about 500 Euros out of pocket, but essentially this was a true no money down deal.

Lessons learned? Challenges?

Very straightforward purchasing overseas.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Send me a PM, I can provide you our agent's contact info.