All Forum Posts by: Martin T.

First, you need to get a dialog going with those who are walking through - you can have requirements and also be friendly and conversational.  I tell people I am the owner up front, and share how long I've owned the property, and that it's important to me to find a tenant who will take care of it (among credit and income requirements, but I don't mention that until after they have walked through and ask about the process).  

If you can be conversational with folks, you can also get feedback at the first showing (ie: out of curiosity, how does this compare to other properties you are looking at?).  For instance, in one of my rentals, the primary bathroom was TINY, and everyone commented on that.  I did a few updates to it (new tile, vanity and mirror), now everyone comments on how beautifully updated it is. 

If you had a good dialog going at first, you can also get feedback later in the process - ie:  "Would you be comfortable telling me why you ultimately decided to rent another property?  Was it the property itself, location or other factors?  Feedback helps me to be well priced and competitive, so if you are comfortable sharing I'd appreciate it!"

Also, nothing beats looking at other listings online AND in person.  Compare requirements, ad language, photos and the property in general.  Go to other open houses too if you can. 

I'm in the process of refinancing an investment property I have owned for 3 years. The value has gone up significantly and I'm about to get a better rate too. I'm considering taking the max out that the LTV of 75% allows. I'll get more cash at closing to use for other deals, and to invest in general, but if I take out the max I'll also be about $100 short each month.

If rents continue to climb they way they have been here, and interest rates go up again, having that money at 3.5% and then only waiting a year or so to break even again seems appealing to me.  

Obviously I could take out less and have a LTV of 65 or 70% but the point of this refinance was to lock in some of those gains, and get cash at a low rate for other investments.

Would you do it? Why/why not?

I'm interested to hear from those here how you handle tenant turnovers. I find the thing that takes me the most time is not so much dealing with maintenance issues (I luckily have had very few issues), or difficult tenants (have not had many of those either), it's more all the little things that go into getting the place ready for a new tenant like paint patching and touch-ups, cleaning, re-caulking bathrooms, getting it cleaned and readied.  Often if there isn't much major work, it still takes me a full day or a couple of evenings to get that stuff done which is a bigger drain than putting up an ad and hosting an open house or two to get it rented.  Have others been able to find a handy person to handle all that for them?  Thanks

We are in contract to purchase a single family home in North Carolina. When it was built in the 80s, it was built on 2 lots which were combined into 1 parcel. However, during our land survey, it was discovered that the old easement from the 1960s when the land was developed, has a utility easement (power company) that runs between the two lots, and now as a result, through the middle of the house.   We will verify but we don't believe there is any active power there.

Has anyone had experience with this and know how to go about addressing?  I reached out to the power company and got the usual "you'll hear from someone in 3-5 business days."  I'm hoping they will consider it a recording error when the parcels were combined and vacate the easement, or allow it to be moved to the right or left side of the property.  The house has been there for 40 years.  

We have asked the seller to get an attorney who has experience in this area, but am interested to know any advice or similar experience and how it was resolved.    Thanks!

Thank you for all your advice and recommendations.  I decided on the route of letting the tenant look for a place and vacate.   Then can paint the place, do some window treatments and it will likely go fast at that point.  My agent recommended the same thing.  Thank you all again!

I have a property for sale in the Bronx in NYC, which has been on the market for 3 months or so.  I've watched other units in the building come on the market and sell, but mine is not.   The price is right, and my agent is getting feedback that it "feels smaller" than ones of the identical floorplan.   Reason being (I believe) is that my tenant has it very unorganized and packed full of stuff.  It's not to the point where it's a hoarder situation, just stuff like an unused treadmill, area rugs everywhere, curtains that aren't hung correctly (no damage to apartment, and it's not unclean, just doesn't present well).  

Another unit in the building shows VERY well (1 floor up, top floor), and sold right away above asking, and mine is priced for less due to it not being a top floor. So it seems like it's the condition of the apartment that prospective buyers can't see past.

I could tell tenant she is free to leave (which she would probably do) then lose about $1,500 per month until it sells.  My agent isn't keen on it being empty, since she feels empty apartments don't show as well either.  I could talk to the tenant about cleaning up (but she's been a bit difficult already with showings).  Have others experienced this and any thoughts?

Thanks in advance!

With the tenant that I ended up approving, there were some negatives and some positives, however the "help me, help you" approach can be a good one.  Keep asking for more information (references, bank statements showing income, proof of savings, etc.) until you can make the decision with your head.  Your heart should also be telling you that you don't want to put anyone in a situation where they're over extended and need to choose between paying rent and other priorities.  That's not a good situation for anyone.

I have a property in New York that I'm putting on the market next week, which should net about $140k in profit after selling it, and I'm planning on rolling that into 2 new property purchases in North Carolina.  This will be my first 1031 exchange and I had a couple of questions for those who have done this before:

- My title exchange company said that for the 1031 exchange, I need to also roll in the money I originally put down on this property (when I purchased it as a primary residence).  That seemed odd to me, since I wouldn't have to pay taxes on that money, if I was NOT doing a 1031 exchange.  If I do need to include that money, I've got $170k in value I need to roll over.  Any insight?

- Since I already own 1 other rental property that I purchased last year (not including the one I'm selling), I'm concerned about getting financing on 2 other properties, which could total up to $700k in value if I was putting 20% down (the $140k).   Has anyone else run into this?  Last year when I did this, I got approved, but after going through some hoops.  My debt load is next to nothing (1 other small rental property), and my income is high, but I'd be purchasing 2 rental properties in the same year this time.

- The 45 day timeline to identify up to 3 properties, 1 of which I absolutely must purchase (required by the 1031 exchange), is obviously a very short timeline.  In others experience, what's the best way to work in that timeline - have the properties ready to move on by the time the other sells, or start even sooner?  I can't quite grasp how challenging that part will or won't be.

- As a last ditch scenario, if I can only secure 1 property for whatever reason, I'd put the entire $140k into it, and get a mortgage on the rest (likely around $200k on the mortgage). Then is it acceptable to get a HELOC to purchase another property later? Or is that not acceptable with 1031 exchange criteria?

Thanks all, really appreciate all your insight!

Martin

Thanks everyone for all your advice and support. I used mysmartmove.com to get their info - both applicants had a 750+ credit score. I called references, employers and their previous landlord and they all gave glowing reviews. I also got bank statements that showed they could essentially pay rent for 3 years with no income.  The lesson I think I learned here is to keep getting info, backup and references until my doubts are gone, and they pretty much are now. If going through those steps revealed red flags, then I would have stopped the process.

I sent them the lease last night and they have signed and are FedExing back to me today. 

I guess every applicant is different but this couple seems like they will be great renters. 

Thanks again for all the advice!

I'm looking for a little advice here.  I recently purchased my 2nd rental property, this one is in Durham, NC.  I've shown the property to about 8 people over the past 2 weeks, but the only couple interested in putting in an application is a couple moving from upstate NY.  They have not seen the property in person other than about 20 photos, and I did a video tour for them of the property and they want to move forward with renting it, and cannot make it down to see it in person before they're relocation.

Other than the sight unseen concern, his income is only 2.1x monthly rent, and she will be looking for a job.  They both claim to have good credit (need to check that, and I will), and have plenty of funds in savings to cover the entire lease if needed.

Would you still consider them, or would you require a hefty security deposit or rent pre-payment?  The issue I'm running into is that Durham is a rather affordable area, so most people with good income and good credit are looking to purchase, not rent.

Any advice would be so appreciated!