All Forum Posts by: Natalie Schanne

@David G. - I’m not sure if I missed it, but I did not see a confirmation from you that the other tenants have complained. If the other tenants are not complaining, I would wonder if it’s more of an issue in my brain than actuality.

Could anywhere in the laundry room or hall accommodate a wall bike hook for vertical storage? They seem to be about $30. I guess she’d say she can’t lift it onto the hook.

Yes - it’s good policy to not allow any common storage. I was just thinking about if I’m older and it hurts to lift stuff, and I’m using my bike to be mobile, that you’re unreasonably hurting my quality of life for almost no reason. I might use my bike 30x a month and you’re only going to visit 1x a month.

@April Hamm - the best strategy for you is to start to buy direct from seller (or the ugly dated houses on MLS) and make your own renovations. Then you know about the renovation and YOU can choose whether to put in good piping or mediocre piping. I was surprised when I had a licensed plumber use shark bite in an inaccessible spot behind the shower, so all my brand new tile was likely to get busted out WHEN (not if) it leaks. "Oh don't worry about it" they always say.

Any corner you cut now, is potential maintenance in the future. I’d rather that I choose those corners or I slow my rehab to do it right. :)

@Daniel Kries - 100% recommend buying either a multifamily or a very large house (6 beds, 3 baths or with potential to convert it, usually 2100 sqft or bigger, and renting by the room.

The large single families are a lot more common to find, often with better layouts, newer, and cheaper per bedroom. You would then furnish the whole house (inexpensive stuff like from Facebook marketplace moving sales is usually good - you don’t want cheap stuff, you want expensive stuff that is 90% off because someone else is moving) and rent the rooms.

Comparison:

$300k - 1950's duplex 3/1 and 2/1, 1600 sqft, located on major road, rooms are tiny. You rent the 2/1 for $1500 and the 3/1 for $2000 for a total of $3500/mo. Assuming no STR.

$300k - 1980's 2400 sqft single family, listed on MLS as 4 bedrooms but really 6-7 bedrooms and 3 full baths. You furnish it and rent each bedroom for $800-1000/month for a total of $4800-6000/mo.

Mortgage for either is $3000/mo (I’m making it up) but one is more profitable than the other.

Note - if you rent rooms, you have to run your house like a tight squad. A single bad personality can snowball into squalor so you have to remove them immediately or screen them out upfront. I don’t allow overnight guests, indoor smoking, pets, etc. It’s just not conducive to shared living. You will find most people are quiet and stick to their 10x15 room playing Call of Duty anyway. They appreciate being able to rent a room for 20-50% less than renting an apartment. my customers are mainly actively working professionals making 40-80k/ year.

@Wayne Alden - call or go to the building department and ask. Usually you can do so totally anonymously such that they don’t know your address or name, and the clerks are not the inspectors. Ask them what you need to do. Then ask other investors who do business in your town, including rentals and flips. BiggerPockets events has listings for local meetups along with meetup com.

In my area - no permits for roofs, siding (they stopped after hurricane sandy because too many people needed them…), no permits for replace in kind like kitchen cabinets with sink in same space. Yes permits for new plumbing piping, new hvac, new electrical outlets and lights. Yes permits for demo of drywall greater than 50%. They know you are not getting permits when new recessed lights appear and you didn’t pull permits, because recessed lights are pretty much never a replace in kind.

The building department exists to keep us safe. If there wasn’t the inspections or the fear of inspections, there would be even more shoddy work than there is today. The average homeowner doesn’t know how you hacked together the electrical panel. They came back multiple times for my new hvac system and I had no idea what they wanted, but some kind of grounding was messed up, and my electrician knew how to fix it, but hadn’t done it right the first time.

So I don’t mind buying permits and paying for permits. The part that’s tricky sometimes is the paperwork required to apply for the permits (llcs must have architect plans vs homeowners can have hand drawings), and the delays with the plan review (on average 3 weeks in my town plus another 3 weeks after you resubmit if they found something wrong).

@Nathan Gesner - I had a tenant leave behind almost all his stuff when he lost his job and moved back to California. I confirmed with him that it was abandoned and he wasn’t coming back, then I disposed of it. One of the things was like a 60” OLED TV which I used to furnish one of my AirBNBs. He was young and I assume he didn’t care about any of it. You know, the type that can roll into town, buy everything he needs at target or Walmart, then roll out of town and leave it all behind.

I believe in this case the other side of the story is - the landlords found the house in a state of poor repair. It is unclear how long they’d neglected to check up on it. When the tenant didn’t pay July rent, they took steps to clean out the property to repair it. It is unknown whether the landlords had already given notice to the tenant to move out on June 30th. Would that change the story at all? Not really in the eyes of it being against the law to throw away someone’s stuff while they’re still there. Was the tenant really at a funeral? Do we feel more generous to a tenant that was at a funeral versus one that blew July rent money at Disney World? This is only the tenants side of the story. It is probably filled with half truths. There’s no justification why the tenant did not pay rent for the first week of July. Yes, the landlord broke the law by throwing away stuff without filing for formal eviction and getting authority to do so by following the correct procedures or receiving a written communication from the tenant that they’d abandoned the property. Yes, I would be devastated as a customer to lose all my personal belongings. I think this landlord tenant relationship broke down a long time ago and was probably acrimonious.

@Kuriakos Mellos - first read your contract. I was approached by a couple who wanted to sell their PM managed condo and the contract said that it expired annually and auto renewed for 12mo, so they had a short time window every Oct to cancel or they were on the hook for another 12mo at the 10% of rents rate and attached fees and maintenance. It also said that if they sold their property that they owed the company 6% commission and/or were required to sell through that PM brokerage.

— second, write down all the things you think a normal PM (or even an on site personal assistant) could handle for you such as house showings (could you use wifi combos or showmojo with a camera for self showings?), rent collection, eviction, emergency maintenance. I would assess the expected costs and time versus my costs and time.

— for properties I self manage, I am more likely to buy a new fridge / washing machine / pick your appliance, and have them haul away the old one than to spend any time coordinating a repair. Because my time is worth $100/hour or more and I can guarantee at the end of buying the new appliance that the problem is solved.

— Vacancy is the biggest $$$$ killer in this business. No tenant. Tenant not paying rent. For my properties, rent can be $100+/day, so I usually paid for contractors who are speedy because the differential adds up quickly. If the guy can paint the house with his 4 person crew in 3 days for $2000 or paint it with himself in 3 weeks for $1500, the crew is better for me.

— you have to have someone as motivated to get your house rented as you are. If you keep making your place a bit better, it will stay rented quickly. You need videos and great photos of your property so you can advertise it for rent starting 30-60 days out from the vacancy because the BEST tenants are looking at least 30+ days in advance of occupancy. I don’t understand when there are crappy crappy photos of a unit or obvious “defects” that could be fixed cheaply and are holding people back from renting. I advised one person to repaint the living room, they refused, and it ended up costing the first tenant who backed out, 3 months vacancy and ultimately $100/mo rent ($1200/year)

Over the past year I have seen several deals for hotels in foreclosure on TEN-X that have seemed like home run opportunities. I’ve asked my friends to invest with me but haven’t seen anyone interested even though they are like 20% the price of a multifamily 1 bedroom apartment in the same town. WHAT AM I MISSING??

Deal 1: 350 key 100,000 sqft hotel with 30,000 sqft conference center on 10 acres. Harrisburg PA. Fully furnished. 1950 original build but recently renovated. Last loan was $15m. Auction started at $1m and ended at $4.5m. (Sold to a local apartment company). Had been a common wedding venue, meeting space. They relisted it as a hotel with $95/night rates. (Rebranded Penn Harris Hotel by Wyndham)

My idea was to rent to 350 single professionals at $800/mo x 350 = 3.36m revenue per year plus on site laundry / restaurant sales. Property was next to a hospital and many offices. Also to build a self storage on spare land.

Deal 2: 200 key extended stay hotel (rooms with small kitchens) in College Station TX near Texas A&M. 30 years old. Fully furnished.

Bidding started $1m

Deal 3: 230 key hotel in Morristown NJ, 13 acres. Fully furnished. Current Sonesta. Close to everything. Auction price starts at 4.5m. In this area, a crappy old 10 unit apartment building earning $1500x10=15000/mo rent, can sell for $1.5-2m easily.

why the hotel versus multifamily valuation is so different? Like cap rate 5% vs 10%?

Also what are the financing options and is it harder to finance a hotel than a multifamily? I’m guessing so with so many of these buildings going into foreclosure in the past 2 years since Covid shutdowns.

Anyone interested in bringing cash or expertise and partnering up on a Nj hotel outside nyc (New York city)? I have $500k cash.

@Kevin Wu - I assume you need to increase your price or look at duplexes only.

@Deb Blue - submit an loi with and without the junk. Get a junk removal service to give you a quote based on the photos you took. They usually think in terms of cubic yards.

@Brandon S. Pangman - As an engineer who specializes in durability, I highly recommend low porosity granite. Just double check and make sure your cabinets are well installed. I’ve seen lots of laminate scratch, warp, get stained. I’ve seen quartz get burned (because it’s glue resin). But the best quality (not necessarily the highest price) granite can really last. I have 12 year old granite that looks like I installed it yesterday and I do not do a good job with cleaning or sealing it. The low porosity granite is more durable against acids and stains. My favorite granite right now is viscount white which is grey with black swirls and glitter speckles. In my area it’s the “grade 1” so cheapest, most common, and runs 35-40 psf.

Brown fantasy is a common color my flipper friend Stan Wilder picks.

No doubt I would pick granite every kitchen. I only keep laminate if it’s in good shape when I bought the property. I use prefab quartz sinks and Costco wood vanities.

Do not ever ever ever choose real marble. It stains and scratches so easily.