All Forum Posts by: Bettina F.

One tip to find good handymen -- go to the parking lot of Home Depot or Lowes (or what ever the big box home improvement store is in your neighborhood) early in the morning.  The good handymen are there in their pick ups getting supplies for the day's jobs.  Get their names and phone numbers off of their trucks.  

The drunks and the stoners are still sleeping off the previous night's binge.

The hotels pay big taxes and don't like the competition.  The City is acting as the enforcer for the hotels.  Nothing new here.  The same thing is happening with the taxi companies and Uber.  Corporate cronyism kills free enterprize and hurts the consumer. 

We sent a new owner letter introducing ourselves and stating that we would be meeting with the tenants within 2 weeks to inventory any maintenance needs and to go over our rental agreement.  We kept the terms the same for the inherited tenants on leases (date lease is up, monthly rent) but we  toughened up and clarified rules.  The tenants only cared about the monthly rent, and lease term.  Most were grateful that someone was finally addressing their maintenance needs and that we were improving the property.   The chronic late payers were not happy that we were enforcing timely payment and late fees.  They were "rehomed" as soon as their leases were up. 

You need a Roommate Addendum to your lease that protects your interests as a LL.  Many of the Roommate Agreements on the net are written to protect the roommates (sort of a "who takes out the trash agreement").  This is not what you want.  You want a roommate agreement that basically says the roommates function as a single entity -- one rent check, one security deposit, the LL is not responsible for determining which roommate caused damage, etc.  The book Landlording by Leigh Robinson has a good template in the back.

Now you sound like my stockbroker-- or my old finance professor!  Yes, my building has a positive net present value.  I could have made more money since 2013 if I had invested my $400K in the stock market, but my husband and I already have significant investments in the market.  We bought our apartment building when we sold the big Puget Sound house and bought a less expensive retirement house.  We wanted to keep the same proportion of our portfolio in real estate. (Diversification reduces risk, remember!)  We went with multifamily for ease of turning over individual units and I don't like the binary options of rent/no-rent inherent in SFHs.

I hate roommate situations.  They just add a layer of complexity to the LL.

Te best defense for a LL is a Roommate Addendum to the lease signed by all the roommates.  This addendum protects the LL -- it does not cover who takes out the trash type scenarios that the roommates need to work out themselves.  It protects the LL by basically getting all the roommates to sign stating they are one entity for the LL to deal with.

The book "Landlording" by Leigh Robinson has a good template.

It sounds to me that the problem was verbal communication to the wife, that got passed on to the husband and misunderstood.  In the future, do follow up documentation of  all conversations in a letter or email.

We have a information sheet that we give or email to prospects that states "Rent is $XXX per month.  The Security Deposit is $XXX.  Total move- in monies are $X,XXX.  You must have a total verified monthly income of $X,XXX to qualify."   This has eliminated much confusion and also helps eliminate prospects trying to negotiate with us.  It also helps people who cannot afford our apartments decide not to apply in the first place.  I do not like collecting app fees from prospects I know will not qualify.

We paid cash for our building, which was fully rented at the time with some marginal, PITA tenants.  Our building is 6 units, and cash flows with just ONE unit rented.  It took us about 6 months to realize that, since we had no mortgage to meet, we did not have to put up with any tenant B.S.  So, as soon as leases were up, leases were not renewed, and units were scheduled for remodeling.  We were very busy that first year but the increased rents and the upgrade in tenants were so worth it.

Having a planned vacancy that allows you to upgrade the unit, reset to market rents, and appeal to a higher quality tenant is a good thing.

I disagree.  Early retirement is the perfect time to buy multifamily.  Much of your life experience will help in being a LL.

In 2011, my husband and I bought the property that would become our retirement home.  We rented this out for 2 years.  Due to high property taxes, we did not want to retire in the big, expensive (but paid for) house overlooking Puget Sound.  We bought in low cost Northern Idaho.  In 2013, when my husband was 62, we sold the house overlooking Puget Sound and paid cash for a 6 plex in Northern Idaho with the proceeds from the sale of the Puget Sound house.  Paid no capital gains, since were both over 55, and moved to our retirement property in Northern Idaho.  We purchased two single story triplexes that face each other to form a courtyard.  We are healthy enough to do most of the painting, mowing, and day to day management ourselves.  We have a trusted handyman for the items we cannot do ourselves, but with YouTube our skills are expanding daily!  (I have become an artist in drywall repair!)  Since the building is paid for, it cash flows like a herd of cash cows.  Rents are rising in our area.  Our building stays full,  and we had NO turnover in 2016.   We average 4 hours a week in managing the property.  This includes mowing the lawn and snow blowing in the winter, rent collecting, and bookkeeping.  (Luckily, our property is near water and that means it is often warm enough that a light snowfall melts by mid-morning.)  Since we are retired, when we do need to put in the hours rehabbing a unit, we have the time without the stress of juggling jobs and LLing.

My husband and I both have significant savings in 401Ks,  We wanted the keep the same proportion of our portfolio in RE, rather than placing it all in the stock market.  We always have the option of hiring a full time property manager in the future.  Our daughter will inherit the property on its stepped up basis when we die, and it should provide a nice income for her.

It has been fun to step out and do something different at this stage in our lives.  I never would have been happy wasting my retirement on the golf course.

In 1983, my husband and I were unable to sell our house when we wanted a larger house in a better neighborhood.  I was 28 and inexperienced.  We were lucky enough to stumble across Leigh Robinson's book.  We bought the new house, kept the old house as a rental.  We followed his book to the letter, kept the rental for 10 years had positive cash flow and made a bundle in appreciation.

In 2017, I am older and more experienced.  I now own an apartment building and the 12th or 13th edition of Mr. Robinson's wonderful book.  It is still full of practical tips, great forms and ideas and corny humor.  I pulled in out recently when I needed to draft a roommate agreement to protect the LL's (mine) interests.  Again, Mr. Robinson came through.

I see a lot of talk about people spending thousands on guru courses.  I think this book still costs about $20.  It is timeless.