All Forum Posts by: Oscar Brooks

Great discussion and love how in-depth we are getting on an often overlooked cell in a deal analysis spreadsheet. Despite @Bruce Runn and others' success at finding renters quickly, since this is a deal with a family friend and seems like you aren't positioning for an advantage over other buyers it doesn't hurt to be more conservative with your numbers and be pleasantly surprised when vacancy is lower. One small thing that caught my attention @Andrew Carlson is that if the seller is flipping through his checkbook for expenses instead of pulling up a nice clean spreadsheet, you should think about what best-practices to learn from him and which to learn elsewhere. A great mentor will ideally be more organized and have better systems in place to understand their business than a cursory glance at the checks they've written.  

@Shane Pearlman My first duplex deal was pre-market and super smooth with @Ryan Luthi. Highly recommended and he taught me a lot.

@Brittney Lundeen this is a tough spot to be in and COVID-19 and eviction rule changes makes it even more challenging. Especially in MN we tent to be very accommodating, but remember that this is a business and your investment is at stake.

I'm not a lawyer, so these are just suggestions, but I am a fan of being as explicit as possible in my leases. If not in there already, the next lease you write up should specify when someone goes from guest to tenant (4 nights/wk, is on site more than 6hrs/day...or whatever you think) so you remove as much subjectivity as possible. Even if he was a perfect guest, if he's there all of the time he is contributing to the wear and tear on the property, water use and utilities (even if tenant pays utilities your mechanicals are working more) so you should be compensated for that. Not quite the same, but if they were running a business from your property and 20 people showed up to work every day but left at 5 and didn't sleep over you'd want to change the structure of the lease.

Similarly, build in specific consequences for smoking in the unit. Fee of $X for cleaning fee or HVAC filtration (if applicable) on first offense. Forfeit of security deposit on 2nd offense. Termination of lease on 3rd offense. Again whatever you feel comfortable with in terms of escalation here.

No personal experience with this device and not sponsored, but I've looked into FreshAir Sensor previously for my Airbnb, and it is a simple plug and play device that detects cigarette smoke. You'd be able to collect empirical data that someone was smoking in unit or basement. 

Last tip, get it all in writing. Even if you have an in-person conversation (from 6ft away), write a follow up email and say "Here's what we discussed today. No smoking. The next violation will mean I keep $X from your deposit for deep cleaning/paint. Guests are tenants if they stay over more than Y nights/week and need to go through the application process. etc. etc."

Good luck! 

You do not need to give your tenant access to the garage. There are plenty of landlords who rent garage space to the highest bidder even if the person renting the garage space doesn't live in the property.

If items are left behind you do need to keep them for 28 days but you can charge (i.e. retain portion of security deposit) a reasonable fee to store those items.

There are lots of other things that are much bigger problems than some stuff getting left behind that I would worry about when considering investing in real estate. $100 for a month of storage unit or not using part of your garage for a month is a drop in the bucket.

http://www.startribune.com/renting-and-the-law-tenants-left-their-junk-behind/294413421/

@Garrick S. you've gotten the attention of some of the folks I've found to be the most knowledgeable and respected in the greater Minneapolis area.

I think what you are hearing is that the high volume offer approach will land you a certain type of property in Minneapolis. If you are OK with the options that @David Barnett laid out in order to get into some properties that may work for you. I'd be curious if there are any realtors in Minneapolis who already use the high volume offer approach for themselves. If there are, maybe a partnership would work since they are already OK with the low hit-rate and extra effort involved.

I either personally maintain or pay for anything that is shared because if there isn't a direct line to a responsible party it is always NMP (not my problem) in the tenant's mind and the small issue will eventually be a big problem. Snow has melted and refroze and is 6" thick ice, grass isn't cut and the city issues a citation, garbage bill not paid and now you have accumulation of trash which can attract rodents or upset neighbors. So water, garbage, lawn, snow just as @Pavel U. mentioned are on me. The one small exception I have is that in my lease I set the expectation that an assigned parking spot (outdoor, uncovered, unpaved) is the tenant's responsibility to maintain so they should shovel, rake, and trim plants.

Impressive that you got it down below the 2018 value @Brian R. What kind of support/evidence did you include with your challenge?

If I understand the limitations correctly, you can sell to an owner occupant in the future without having to convert it back to a duplex...of course that limits your buyer pool.

Finally heard back from the assessor and got a reduction of just over $50k! My sales ratio (assessed value/sales price) is still greater than 1 which is not great for a property that I owned for only 6 months before the assessment, but I didn't think it was worth the risk of continuing the challenge and potentially ending up with a higher valuation. Curious to know how others fared with this process.

@Pavel U. Still waiting. Emailed and got this back, no specific response date given. "I apologize for the delay. We have volumes of appeal this year. We will get back to you soon" If they are getting volumes of appeals maybe that's a sign they didn't do a great job of evaluating values.