All Forum Posts by: Rusty Thompson

@Jay Hinrichs 

That is a really interesting point you bring up. The inverse relationship between work and pay when it comes to rental classes. If the rate of pay is the same. Class A properties will have less calls, less maintenance, less late rent payments... ect. As you move down the scale work goes up but the reward for the managers go down. A property manager would need to get paid on a sliding scale depending on the level of difficulty associated with the asset. It could be a revolutionary system, but the PM would need to know a lot about their local market to pull it off. I also see a lot of lower end customers going some where else, which might not be a bad thing for the company.

@Bill Exeter 

Thanks for clarifying that. I thought that was how it worked, but after reading the above post I started questioning myself.

@Bryant Cheely I'm having a hard time following what is going on exactly. Its early so excuse me if I am not understanding what is going on. From what I have gleaned you are having a hard time determining who to hold responsible for damages between roomates when moving new ones in and out? I hold everyone personally responsible for damages in my units. It doesn't matter who did it. It is spelled out in the lease. If you are doing a inspection before new roomates move in then wouldn't you know what damages were there from the previous occupants? It appears they are also asking for a new lease mid lease? 

I agree with @Marcia Maynard . Charge them a "change of lease" fee. Outline in the beginning your procedure when it comes to adding and removing tenants. Since you are only signing one lease, then only collect one security deposit. The tenants will have to determine how to handle pay out the tenant moving out. Do a full inspection before a new tenant moves in & invoice the remaining tenants for any found damages. Let the new tenant know that they have 1-week to let you know of any damages you may have missed or they will be liable for it. My final thought is, is a lease working for you & would going month to month make more sense.

@Andrew Cordle 

I agree & disagree. If he qualifies for a FHA loan & the numbers work & he is comfortable with a risk. I think he would be crazy to use it for a SFR. I know for a fact how difficult it is to finance a 4-plex without at least 15% down in todays lending climate. 3.5% or 5% down would leave him with money he could set aside for reserves or invest in another property. If he feels comfortable investing after that, then move forward. If not, assuming the 4-plex cash flows, he can have it professionally managed while he sells it.

The fact the 95% of buyers on the market looking for a SFR doesn't seem like a bonus to me. All that means is that you are competing with first time home buyers & flippers. Unless he is lucky, the best deals will go to one of them.

If he doesn't qualify for a First time home buyers program then a SFR might be a good choice. In most areas SFR's sell for less than 4-plexs and he will have less of his cash tied up in one deal. If he decides he doesn't like it then as you said it will probably be a easy sell.

@Elizabeth Colegrove 

That is a really good point. I should probably reconsider it in the future

Man, if you think your life is busy with 2 units, wait until you get over 10. Couple things I can think of. Train your tenants. I tell my tenants to not call me unless it is a emergency. Otherwise text. I use my breaks at work to take care of paperwork. I have someone cook my meals for me. Which is a double time saver as I don't have to go to the grocery store or cook. Don't waste time while watching TV, use it to do things on your computer.

Its a long shot, but do you qualify for any of the first time home buyer programs?. If the numbers work I would recommend a 4-plex. It could possibly be the lowest cost per unit you will be able to get. One thing I think seems obvious, but I seem to find myself explaining to newbies is to not buy a duplex for twice what you can buy a SFR for. All things being equal.

@Elizabeth Colegrove 

The landlord tenant code in my state specifically states that check and money order are the only acceptable forms of rent. I accept personal check until the first one bounces. From then on I will only accept money order. Luckily I have never had that happen & most of my tenants pay with money order as it is.

You might also consider searching the term "buisness plan" and see what comes up

I don't know if you are going to find a defined business plan template. There are a lot of different paths to take in Real Estate each one is going to depend on where you are at in life, what assets you have & what your goals are. If you listen to Pod Cast 74 Jordan Thibodea outlines the evolution of his buisness plan. 

When I wrote my business plan I decided on my goal then designed my plan around it.