All Forum Posts by: Renard Miller

@Josh C. Definitely understand that. It's just that there is some inherent value in having security deposits in place. The implied value of that is not 0, so when the sales contract contemplates them, it does not feel unreasonable to seek compensation. But you are right that the most likely outcome is a lesson learned. 

@Sara K. The units are decent inside and the tenants do not appear to be an issue. I guess my thinking is that if X% of security deposits wind up being kept by the landlord, there is some value to what is missing. 

@Jennifer Beadles that is a very helpful point re: the leases. I will have to go back through each and check. I know that our sales contract contemplates the security deposits being transferred at closing, which would have been a better time to bring up that the seller did not collect them. Hopefully we can recover some amount, but at worst, this is a relatively cheap lesson for future deals. 

I am in the final stages of purchasing a fourplex in Virginia and wanted to see if others had any thoughts on what my options are. In the future, this will be a question I add to my diligence checklist, but in this instance, is it reasonable to ask the seller to make a purchase price concession to account for the missing security deposits? The seller simply did not collect security deposits for three of the four units and did not mention this fact at any point up until now. 

As security deposits are the tenants money, it is not necessarily a perfect solution to ask the seller to cover these amounts, but it also creates great risk on my end if there are no security deposits in place. 

As I see things, my options are: (i) eat the cost; (ii) have seller adjust the purchase price down by some agreed upon amount; (iii) have seller write a check for the missing security deposits; or (iv) have inherited tenants pay a security deposit when we take over the property. None of these seem perfect, but I am wonder if there are reasons one might make significantly more sense than the others. 

Would love to hear any thoughts on the matter. Thanks in advance!

@Justin Pierce There is definitely more employment in Norfolk and people only tend to cross the bridge recreationally or if their job is particularly high paying. For the jobs that are more common throughout the area, people tend to live and work on at least the same side of the water. 

@Robert Rodriguez we have not gone down the Section 8 road thus far, so I will let someone else speak to that, but that is something we would be open to exploring in the future. Thus far, we have inherited tenants at each property, so we may explore more options once we have vacancies and can make the repairs/changes necessary for Section 8 compliance. 

Hi @Amy H.! Thanks for asking. We own the Bonchon on the corner of College and Granby in Downtown Norfolk. Definitely check it out the next time you are in the area! 

Hi, Justin. As my wife, @Ayana Miller, said above, we invest in Hampton Roads (thus far primarily in Hampton, with an interest in targeting Norfolk in the future), where we are from. We are in Hampton Roads about two weekends a month between family, real estate and business interests there.

The market is very investor friendly as many are looking to rent for a variety of reasons (military, students, recent relocation, etc.). The future looks bright in Norfolk, specifically, with a number of businesses (ADP, IKEA, etc.) coming online this year and next. The city is also making strides to grow its already attractive downtown area with the revitalized Waterside opening earlier this year. With two universities, in addition to a thriving community college network, there are any number of attractive audiences to target when thinking about buy-and-hold strategies. If you would be interested, I would love to connect over coffee in the near future.