All Forum Posts by: Michael Kistner

@Gab Loo @Hannah Peerbolt wrote a good blog that covers a lot about what to look for in your property manager. https://www.biggerpockets.com/blogs/10723/71963-finding-the-right-property-manager-as-an-out-of-state-investor I’d really look at point 3 she makes. A spoke to a lot of property managers before going with the one I have and most of them had random little fees they charged for different things. I also like to ask about their worst experience as a property manager and how they handled it. How often they communicate what’s going on as well. Are you going to get a heads up on little issues or have to find out at the end of the month what’s been happening. Hope this helps. Good luck! - Mike

@Vinh Hoang Welcome to BP! Coming to the Bay Area from Chico I think it’s a good market. Good college town but also has a big hospital. Two big things I look for in a market. Good luck! - Mike

@Rachel H. They’re all good neighborhoods and I wouldn’t say there’s any cosmetic issues as much as just being outdated. I’ve been fortunate to find older couples for the most part and the decor hast bothered them. 

 With that said I do think a time will come when I’ll need to update it. And after some good suggestions I’m going to start making more detailed lists for each property and how I can update them without breaking the bank. 

I will have to look for a team so I’m glad I have some time because the properties are out of state. I appreciate the advice! 

@Mark Nickoson I think having a plan on future repairs and renovations will be the way to go.

 @Sylvia B. knock on wood, I've been getting nurses and older couples. (Maybe that's why they don't mind the 60's décor?)

   I appreciate all feedback and enjoy hearing other strategies. I'm leaning toward modest remodels, not top of the line material or appliances by any means, but at least get the places out of the 60's.

@Michael Boyer

    Thank you for the response. 

   Getting tenants that are rough on the property is the major reason I didn’t initially do any major improvements. And the peace of mind is probably the bigger driver behind the question. 

Thanks for the responses! 

  Every property has been purchased at or below 75% the value. I haven’t had any trouble renting them out. 

  They were all built in the late 60’s and most haven’t been updated since then. 

If I update each property I would be able to increase the rent but it wouldn't be a great ROI.

  As far as an exit strategy I don’t plan on selling them unless the area got bad for some reason. I’ve found a commercial lender that will give me a line of credit on 80% of the combined equity of the properties.

  I think it’s because I don’t plan on selling them that I go back and forth on making major improvements. 

Hey BP Forum!

When you purchase a buy and hold property do you believe in making only necessary repairs or do you go in and gut the place even if it doesn't help your ROI?

     I’ve been going back and forth on this lately and am leaning towards gutting the rentals and updating them. But I’d like to get more opinions and hear others strategies. 

 Thanks,

   Mike

Hey BP forum!

  I have a question geared more to the buy and hold strategy. 

When you purchase a buy and hold deal do you remodel and update the entire place or do you only do the necessary repairs to maximize ROI?

Originally I was only doing the necessary repairs, maximizing my ROI but have recently revisited some earlier BP podcasts and hear people going in, gutting their buy and holds and making them really nice.

   I can see the benefits to having nice products and making them easier to lease but I just wanted to hear other people’s strategies and why they prefer it. 

Thank you!

- Mike

@Vanesa Gonzalez

    I’d look at the lease agreement you inherited and see if it’s been violated in any way. If so give them their 3 days notice and they’ll likely work with you. 

    I have also heard of owners paying awful tenants to leave. Usually one months rent. Worst case scenario give them their 30 days notice next month. 

  Good luck!! 

 - Mike

@Sarah Nation

    Have you considered buying a single family and renting rooms? If you don’t prefer to do that start networking with agents in your area and request that they send you all the multi families that come on the market. 

    It’s an easy thing to do on the mls and then just start analyzing as many deals as possible so you recognize a good deal right away. 

 Good luck!!

 Mike