All Forum Posts by: Bob Collett

Based upon the scenario as you describe it, the moving company is responsible.  If it is a real company and not just a few guys with a truck... they have an insurance for this purpose.  Have the seller file a claim with their insurance company, since they hired the insurance company.  If you choose not to let the movers fix the problem, you will probably have no case... I am not an attorney... just my best guess.

Get an application from each adult... especially the current boyfriend who will be staying in the house. Determine how many “sleepover” days per month qualifies as residency.

I require credit score 600. If it comes in lower than 600, I adjust security deposit upward. Consider disqualification for collections or charge offs on credit reports. Getting tenants is easy... getting tenants to pay on time... not so much.

Consider asking to see a savings or checking account statement. It is amazing how many tenants have $0 savings. When a car payment, phone bill, or Christmas toys, insurance bill, food, etc comes up... skipping rent is easy for someone who has no savings.

There is usually a reason if tenant has no checking account... I promise it is not because the bank screwed up.

Create formal written guidelines and follow them to avoid discrimination claims.

Don’t ask a disabled person any question that you would not ask to a non-disabled person.

Remember, service animals are not pets.

Determine what type of convictions are disqualifying ahead of time. You are generally safe disqualifying for convictions for crimes against property or violent crimes.

Of course you cannot discriminate against children, but you can check local square footage requirements to prevent an unacceptable number of occupants of any age. Make sure you have specific rules regarding which rooms allow beds... you would be amazed where tenants will put beds... basement, attic , dining room, etc.

Many local communities (cleveland) have an ordinance that allows no more than 3 unrelated adults.

If you allow pets, consider a viscous breeds list. Every pet owner insists that their dog is the friendliest pet ever. Ask your insurance company if they have a viscous Bree’s list for rentals. Don’t even think of not telling your insurance company that the house will be a rental.

Also, there is usually a reason why tenants want to move between Thanksgiving and New Years Day... someone else just kicked them out. Verify.

With respect to 3 times combined income... what happens if the boyfriend moves out? Or the roommates split up. Thus one is a challenge to plan around.

Good luck

Bob

I would say out if tien investors often have unrealistic expectations especially with respect to ongoing maintenance and turnover costs.

Typical registration fee ranges from $70 -$200 annually. Some cities also have a vacancy fee.

Bob

Dur

First, I would say don’t assume the tenants are telling the truth. Tenants lie about payments all the time... especial with a change in ownership or a change in management. 

I assume that both your realtor and your property manager advised you that the expected rent was unrealistic. Did you talk to the tenants during your walk-through before closing? Did you get a lease ledger for the past year? Did you personally visit the property? Did you hire a 3rd party inspector? Did you get a residential property disclosure form? Was there proper rental registration on file?

What city and zip code is the property? What does the signed lease say?

Answers to the above my shape my response. Feel free to PM me

Bob

@Rich Burnside

Cleveland proper passed the lead safe ordinance. This included increasing rental registration fee from $35 to $70 per unit.

Neighborhood, original square footage and condition above all else.

The only people who pay a premium for improved homes in poor Cleveland area neighborhoods are “out of towners” caught up in the Cleveland investment hype.

I get quite a few out state or out of country investors who pay a 20% to 30% premium to market value for a “turnkey” property only to sell it at a loss a few years later after reality impacts the bottom line.

The other thing that goes on is that otherwise “smart” investors pay cash for a home without the need for an appraisal. When they go to sell, the buyer is getting a loan, so the appraisal comes in 30% below contract price.

Then there is deferred maintenance. Investors forget (as does most everyone else) that housing is a depreciating asset. This is especially true in a place like Cleveland (area) that has seen a population decrease in each of the last six decades. Those left behind are striving to buy in better neighborhoods that would never support more than 3% to 5% return on investment.. if any cash flow at all.

Now, today, financially broke inner ring suburbs and even Cleveland proper are killing rental owners with rental registration fees, violations, construction permits, vacancy permit fees, contractor registration fees, POS fees, POS violations, POS escrow requirements, etc. if this isn’t bad enough, the city just passed an ordinance requiring (investors only) homeowners to PROVE that their properties are “lead safe”, which requires a licensed certified registered lead inspector. On top of that, the city just passed (or is passing) and ordinance stating that renters have a right to free legal counsel in an eviction hearing.

Make sure you are asking the right questions.

Good luck

Bob Collett

Realtor and property manager

I get calls all the time from out of state or out of country investors who think they would like to invest in Cleveland. Of course they need a real estate agent and a Property Manager.

Most investors want to start on the east side of Cleveland or in the inner ring east side suburbs like Maple Heights or Garfield Heights, etc They want to know what I think.

Today I saw a Facebook post from another property manager and Realtor friend who sums it up with a bit of tongue and cheek, but mostly spot on:

Maple Hts Process
- Violations
- Repairs
- Registration Fees
- More Violations
- More fees
- Reinspection
- More Violations
- More fees
- Turnover
- Additional registration
- Additional fees
- Additional inspection
- More Violations

This process is similar in all if the rental registration communities, but some are worse than others.

Bob

South if I 71 where?

Pretty much all of old Brooklyn is south of I 71. Old Brooklyn housing stock is an east west thing relative to Broadview rd, state road, Fulton, ridge rd. Also note age of house.

Generally preferable to anything on east side of Cleveland proper.

Many people in old Brooklyn who care about education will send their kids to a catholic school. (There is no religious affiliation required for admission)

Hi

I recommend that you join the local neighborhood community organization... attend meetings... get involved.

Bob

What zip code?