All Forum Posts by: Chad Hovermale

Are you planning on making any improvements to the property?  That's a good time to raise rent.

Also, you could ask the seller to raise rents before close.

We take our application and revise the title to "Resident Update".  Run it like you would an application, but it's less threatening to the tenant.  It becomes a "getting to know you" instrument.

Don't wait to raise rent.  They expect it.  They know that they are paying below market.  They've likely been shopping for a new place in anticipation of the potential new ownership and have seen what they would have to pay if they moved.  Waiting to raise the rent will create a grudge.

Good luck.

How did you screen the potential resident?  What criteria did you use?  

This just keeps getting worse for me.  I'm working at home and called over to Angela, "Hey!  I got got a vote on my post from @Joshua Dorkin !"  Her flippant response was, "That's cool, hun.  Did you order your book, yet?"  Ugh.  Yes.  I ordered my book three days ago and recieved it last night before you took it from me.  Thanks for the link!

I don't know whether to throw a party or cry.  J Scott's Flipping book came in the mail yesterday, and I started reading it this morning.  I explained my excitement to my wife and told her it was a "roadmap", blah, blah, blah.  I turned to the staging chapter (18?) and flipped through a few pages.  She now has the book in her possession and won't give it back.  "Can I underline it and highlight?", she says.  Are you fricking kidding?  Then she says, "Maybe, I need to get a copy."  Yeah... maybe you need to get a copy, so I can have mine back.  I just lost my brand new, mint condition Flipping Houses book.  A small price to pay to have an educated, engaged spouse.  

I make a living as a trade contractor; and if it weren't for the complaints and bad experiences that people have about other contractors, it would be a lot more challenging to secure long term relationships within which our company can provide reliable and profitable services.

That said, as an investor, instead of asking, "What are your biggest complaints?", I would flip the question and ask, "What are the top three things you look for in a contractor?".  So... I guess I'll start that thread in the forum.

Remember, there are two sides in every relationship.  We look for long term trade partners that can count on us and upon whom we can depend.  The use of leverage is the last resort, and indicates a break down in goodwill and function in the relationship.  Treat contractors with respect and honor your commitments.  If your contractor needs money down to start a project, then they haven't been in business long enough to establish working capital.  If they DON'T need money to start a project, then I'd be willing to give them money up front.  (It's like when an investor goes to the bank: The more you NEED money, the less they will give you because they assume more risk).  If the contractor doesn't have a track record in your market, then trust them with small stuff.  As you grow, they grow.  Don't drop them for the cheaper contractor after they've proven themselves (It's likely that the cheaper guy isn't running the business well and is just chasing cashflow,  short term win for you, but you'll probably end up with more complaints to add to this list).  Appreciate that there is a cost to running a business that can provide solid service in a timely manner... speed of transaction in a flip or renovation saves you money, and everyone wins.  Now I'm rambling...  I love this topic.

Without knowing where the property is, I bet that the units rent for 600+ each in GR.  The l/c terms are fine.  What's going to kill you is managing it.  The hassle factor for tenants willing to pay to live in the place is through the roof.  The numbers work, but this deal could be a drag.  

We operate a drywall contracting business in Grand Rapids, MI.  All of the advice is good on this thread.  @Justin Grubbs has a great recommendation for how to handle this in his region.  @Josh C. has a great rec for how to handle this in his region (especially the one throat to choke wisdom).  In my experience, drywall and paint are conflated in some markets and treated as different trades in other markets.

When in doubt, it is easy to go materials suppliers (drywall specific, or paint specific, not the lumber yard that has a pile of drywall in the back). They will tell you how these trades are customarily approached in your region. You might ask the two painters which supplier they use to purchase drywall. Another option might be to ask your REI network in the area for their recommendations.

It is a lot easier to hire a bad contractor than it is to fire a bad contractor.  Stay diligent and plod through the back and forth communication frustrations.  The effort you make to figure this out for this project will add value to your future projects, as well.

Good luck!  Keep at it.

Hi, Tessa.

Welcome to BiggerPockets.com.  You are in the right place.

One tip: Make sure that you set up a few keyword alerts. "grand rapids" is a good alert for staying in the loop with the active REI community in the area.

Best wishes!

Chad

Many people do a great job filing their own taxes using software like TurboTax.  You may be able to get the answer you are looking for from the TurboTax customer service support staff.  My earnest experience is that hiring a professional accountant to file your taxes will be worth whatever fee you pay and provide the peace of mind that filings are correctly completed in order to protect your assets and your real estate earnings.

Good luck.

@Liz Carpenter Welcome!

My wife and I are active duplex investors in Grand Rapids.  We love it!  Thanks for introducing yourself on BP.  The advice in this thread has been terrific.  I'll only add a couple of things:

1. There are several sub-markets in Grand Rapids.  Each of the submarkets in which you'll find 2-4 family properties has pros and cons.  I could share a lot about what we like about the Kentwood area and why we invest there.  But, I am always looking at listings in Wyoming, GR, Hudsonville, Jenison, and Northview school districts to get an idea of values.  School district makes significant differences in gross rents.  Also, scout places close to the college campuses in GR.  

2. If I were in your shoes, I would consider using a property manager.  We service our places and take great care to serve our residents, but I don't want to be on-call to a neighbor next door 24/7.  It would also allow some space for you to operate the business of real estate ownership without the social obligations of neighborliness.  Not all potential residents will reciprocate that obligation in a multifamily property. 

3. Set up your keyword alerts ASAP!!  "grand rapids" and "duplex" for sure.

Lastly, I'd repeat @Brandon Krieg  's advice to attend the meet-ups.  They are comfortable places to interact.  There is a broad range of experience levels from multiple demographics.  

Best wishes,

Chad