All Forum Posts by: Robert Schumacher

@Russell Gronsky

In the state of CA ... they are tenants after living there for 14 days. I would suggest having your attorney serve a 3 day cure to remove anyone not listed on the lease from the premise. You can still evict for lease violations (except nonpayment of rent) right now. What county is your property in?

@David Carroll You are the only one that can decide this. If you have 200k sitting in an IRA and your not dependent on it for retirement, you may choose to pay the 100k in tax & penalty but getting that 100k is a slow process !!

If your plans were to have this grow into your retirement nest egg and it’s moving in the right direction, why change courses? The grass is only greener on the other side if you water it.

Real Estate can get you some great ROI but it's because of smart leverage. Are you going to be able to buy with 10% down, have it cash flow positive and beat your current situation? I spend a lot more time on my RE investing and my 401k gets 3-4 hours a year to rebalance twice a year.

Personally, I went to work and put the extra effort into making more money. Once you learn how to get your hustle going, that is how your going to grow.

IT IS HARD WORK !!!

I think having multiple income streams going into retirement in the winner. You got the 1st steam started ... keep it growing and be patient getting the income stream started.

Be Patient !!! Very few grow wealth quickly. Most do it systematically with a game plan and follow through by executing a plan.

@Colleen F.

Thanks for the challenge on the temperature question. After further research, (25 CCR 34 Heating) is showing 70 degrees.

@Robert Freeborn

What are CAP rates in the area?

Does it CF with 100% financing?

How much would you need to update all 8 units?

My concern is your lack of capital. Personally, I would be looking to see if the numbers allowed you to update all 8 units, bring rents up to market & then finance it to get your capital out but only to the extent of the property is still cash flowing.

If it doesn’t CF but you can raise the value, sell it and you will have capital for your next venture. Make sure you run all your numbers.

Do you have Rent control in your area preventing you from raising rents?

@Amy Zemser

I am not familiar with NY law, but in California, providing heat is a habitability issue. I would encourage you to learn what is required of a landlord. I believe the heat need to reach 73 degrees (3 feet off the floor) to be considered habitable in CA. How is it defined in NY?

I would also be very cautious, because you could be liable for retaliation if you are not careful. A tenant deserves heat. Her complaining isn’t a reason to kick her out.

This would ABSOLUTELY be in my attorney’s hands moving forward.

Best of Luck !!!

@Bud Gaffney California just put in statewide rent control effective 1/1/2020. Landlords with under market rents will be hurt, and the rent increase limits were retro back to 3/15/2019. Could this happen in MA?

@Kam Mill

1. Get a Great Property Manager

2. Screen your Tenants - set standards

3. Use licensed contractors w/insurance

4. Get large security deposits

5. Build up & retain cash flow / 2 years

6. Repeat if the numbers work

7. Always evaluate your anticipated expenses to actual expense to ballpark better on the next deal.

8. Always be “FAIR but FIRM” w/ tenants,

9. Document Document Document

(Tenant calls, repairs done, upgrades, and most important processes if you want to grow.)

I went from 1 to 130 units in 3 years and it’s hard work. Build your team and upgrade the weakest links as needed.

Good Luck !!

@Jonathan Pflueger

I only mentioned it for newer investors.

I assure you I wasn’t trying to call you out. Cheers !!!

@Jason Martinez ... Would your employer Pay you before getting your job completed? If you pay a contractor upfront, what is the incentive to return?

We don’t EVER pay them upfront !!

We will pay them for work completed on a pre-determined schedule that everyone agrees to in advance. The final 10% is paid upon successful permits being approved.

Put everything is writing.

@Jonathan Pflueger ... I hope your trying to bring your multi unit building from an 8.5 cap to a 6 cap. I think you got your numbers reversed.