Tanya F. Thank you for your thoughts. Yes, I am in a hot market. Rents are currently $600 and $625 for the place I'm purchasing. Tenants do not pay water or trash. The average rents for units my size are 750 to 800 for average rentals and that does not include utilities.
The 2% was me calculating how much rent would have grown to if rents had been increased 2% over the last 10 years. I see know how this is too big of a surge in rent, but the numbers totaled less than current rents in the area. Maybe not the most sophisticated calculation but made sense to me at the time :)
The current tenants are MTM, so I wouldn't be breaking any lease terms. One tenant keeps an immaculate place. The other whose lived there the longest, has three boys. Not slobs but definitely well lived in, according to my husband.
The units are older, and we do plan to update. No major damage. Am trying to figure out if I should give them notice or keep them. Not sure about their incomes yet.
We are making a big transition right now, and not sure if being an immediate landlord or remodeling first is the way to go. Trying to make the easiest transition with three kids. I like the idea of having the security of the rental income upfront. We will be living in and remodeling the third unit, so no cash flow immediately.
If I did sign new leases, do I collect new security deposits and include the deposits on hold now. Rerun old deposits and start fresh? Or am I stuck with the low $200 deposits?
I definitely want to be reasonable and that's why I asked Marcia Maynard. Her advice seems sound. Your advice is also welcome. Always something to think about. Just when I thought I'd considered it all. Appreciate you turning my gears.
