All Forum Posts by: Marcus Curtis

Documentation and enforcement are key to this issue. If you ignore it the next thing you know you will have a hard time evicting someone you know nothing of other than the fact that they are occupying your property.

I would send a letter out to them something like this:

Dear Tenant on Lease,

It has come to my attention that you have an unauthorized resident living within your apartment. This is a violation of your lease. These occupants must vacate no later than Noon on Monday, September 1st 2014.

If these occupants wish to apply and to be added to the lease they may contact me to submit an application. Application fees may apply. If these occupants do not vacate on or before the above time and date your lease may be terminated.

Thank you in advance for your attention to this matter.

Sincerely,

Your Awesome Landlord who likely has to pay for the added utility costs and liability of your "guests"

How about this...

While I understand your thought process here in it being hard to fill vacancies in the winter months I think you may be approaching it in the wrong way. Allow me to explain.

You have a prospective tenant that is interested in your property. They want to lease for 12 months but because you realize this puts the lease end date at an unfavorable time for you to lease units you suggest a 10 month lease. Although the tenant accepts with little hesitation you manage escaped having to fill a unit in the slow season.

However, what you have done is shortened the life of a lease only to have them possible move out sooner which results in your costs to turn the property (likely averaging around $1500).

Here is what I think would be more beneficial to you as a landlord. Do the 12 month lease. In that lease or on a separate addendum include a clause regarding the move out. I call mine the "Winter Move Out Clause".

 This clause states "Management and tenant agree that no notice to vacate will be given during the months of October, November or December by either tenant or management."

This gets you over those months that are hard to lease the apartment. If a tenant must move for whatever reason they can break their lease by paying a break lease fee which could be equal to one months rent or less. If you are real generous you can tell them they will be relieved of their lease when you find another tenant to replace them.

What are your thoughts on this route vs. the 10 month lease idea?

@Sam Hodgett 

NE is a HOT area right now. Defiantly and area you would enjoy also with all the arts and younger professionals.

Get in touch with me when you arrive back in town- would love to see how I can help you in your pursuit!

Another added element in support for the Large Multifamily venture is the fact that equity build has much more potential in MF than in SF if you acquire the right property.

If you have a property with low vacancy but also low rents and one that can use some cosmetic upgrades you would be positioned to increase your potential income.

Say you have a property that has good layouts in an attractive area but it really needs some modernizing in the common areas and in the units. Maybe the curb appeal is lacking and could use a good refreshing.

You first address the minimal cost landscaping making it an eye catching property. Then you move into the halls. Replacing carpet, painting halls, changing out lights to new modern LED fixtures etc. You make it a fresher, cleaner and more welcoming property.

You bump rents from say $900 to $945. More money in the bank.

A couple tenants gripe about the rent hike and move out. You then go into those units spending $4,500 in the kitchen and bath (new cabinets, counters, maybe appliances and some tile work)

You now have a fresh unit ready to lease out at a new remodeled unit price of $1,025. Do this over the course of three years and you now have a property that's valuation is significantly higher than when you bought it.

You can take additional steps in improving the attractiveness of the property by installing a fitness center, business center or a community room in an area that is not currently leasable space.

Now that you have a property that is valued higher through both forced equity (sweat equity) and pay down of mortgage you can now leverage that equity in a Cash-Out refinance and roll those funds over to a new and exciting property to repeat the cycle.

It sounds like you are positioned to leave a legacy!

Just remember this one rule: A landlord is like a gambler. When you have a full house, You raise (rents)!

Welcome Home, Sam! I trust you are researching the Minneapolis market and finding your target neighborhoods. With a vacancy rate of 1.7% you are moving to a stellar market to begin your investing career.

If you are looking for ways to help save your money for your first home and to gain experience in the role as a landlord I recommend becoming an onsite resident manager at a small multifamily property for a management company. There are several opportunities out there for folks like you and your wife- message me for a couple recommendations.

Where in the metro are you looking currently for your first investment?

Write them a pleasant letter containing something along these lines: 

Dear Tenant,

It has come to my attention that you and/or your guests gave been smoking marijuana within your apartment. This behavior is illegal and must be corrected immediately.

Your lease contains specific language regarding the use of illegal drugs and other such activity within the property. This is a direct violation of your lease.

If I receive any further complaints or evidence of illegal activity coming from your unit your lease will be terminated/non-renewed.

This is a very touchy area for landlords. Although the lease in which your tenants are under do not allow cats you must comply with this accommodation request. You will have to complete your own due diligence though. I always require such requests to be fully documented by having the resident provide a service animal request form which can be obtained through any real estate attorney in your state. This form is to be completed by the resident and returned along with the doctors note. The form contains a release for you can then follow up with the doctor for verification.

(Note: You cannot email medical documents under the HIPA Act.)

Fun Fact: Did you know service animals can include not only Cats but also Ponies? I'd say let them have the cat, waive the fee and just be thankful you do not have a Pony walking through your halls.