All Forum Posts by: Ryan Morrissey

@Gualter Amarelo thanks Gualter. I’m definitely interested and will send you a PM with more details

@Erik Whiting thanks for the thorough response. I’m completely on board with the “ounce of prevention” proverb. The tenants who we’ve been evicting are primarily tenants inherited from the purchase of these properties last year. The biggest challenge has been identifying quality tenants in this market to replace them once we’ve got them out, but I’m definitely trying to be patient with this process and looking for the kinds of qualities you’re talking about. I recently filled 2 units, but still have 4 vacancies out of the 18-unit portfolio. Need to find the right people...I posted on this topic as well in a separate post to try and get some guidance from more established landlords in this market.

By the way, 3-4 weeks to have tenants out is a dream! Massachusetts is notorious for being extremely tenant-friendly. The process takes minimum 6-8 weeks and sometimes longer depending on the circumstances. 2 weeks before you can deliver a 15-day notice, then they have 15 days to pay up. So after a month of non-payment you can take them to court, which usually books at least 2 weeks out for a court date. Then once you get in front of the judge they usually at least give them until the end of that current month to move out (sometimes longer) resulting in a full 2 months lost.

@Rob Malda this is definitely the cheapest way to do it. I am not local to the area I invest in so I don’t have this option, but we’ve figured out a way that we can have the PM do the eviction for $600 instead of $1,000 for the attorney. See post below for more info

@Jill F. we've recently began using the property manager to do the eviction in MA instead of an attorney to save some money. Property manager charges about $600 vs. $1,000 for attorney. For the tenants that we have put in to the units, the lease agreement is between the tenant and the property manager which gives the PM the authority to evict. My LLC which owns the properties is nowhere on the lease and so is virtually out of the picture. Not sure if this would work in OH, but it's been effective in MA and has saved money on those evictions we've had to do on tenants that we've placed.

For tenants who were TAW that I inherited when buying the properties, those evictions had to be done by an attorney since they have no contract with my PM. The cheapest way is to obviously do it yourself, but whereas I am not a local investor, I cannot be the one to do it.

@Jonathan Killam this is definitely a good idea in theory, and we actually have had a few cases like this where we come up with a payment agreement, but we do it as a formal stipulation agreement documented in court during the eviction hearing so that it is formally documented. That way if the tenants don’t follow through then we can pull the plug. I’ve had mixed results with this....some have followed through on their stipulation agreement and are still renting from me now, others haven’t and we’ve had to follow through on the eviction. The nice thing about having the formal stipulation agreement is that if they don’t follow through, you can immediately evict, as opposed to if it is informal then you need to still start the eviction process from scratch. This stip agreement will still cost about a grand though as we need to pay attorneys fees to handle it in court.

@Gualter Amarelo I see that you did submit a response to my other post on tenant placement already, so thank you for that and I will follow up with you via PM

@Gualter Amarelo thanks for the input, but that didn’t address my question. I’m looking for feedback on whether or not landlords use collections services to try and recover losses from former tenants who were either evicted or terminated their leases early. Do you bother with collections or just write it off as a loss? Are there certain situations when you decide to pursue damages vs. leave it alone? If you pursue damages, have you had any success?

The vacancy rate you’re referring to at 5-7% for a portfolio that’s been under your management for 7 years makes complete sense and is probably the average for a mature portfolio under sound management. My experience in year 1 has been 10-15% as a lot of poor quality tenants were in place at the properties I purchased and we have intentionally induced high turnover to clean house through evictions and rent raises, improving each of the units during the turnover. I have a separate post about identifying quality tenants in this market area which is another challenge I have right now as we’ve been turning over a bunch of units lately. Currently sitting with 5 vacancies and quality tenants have been hard to identify. When you say you could fill your units with “engineers” if you wanted, I’d love to hear more about what your sources are for identifying such quality tenants so quickly in this market area...but perhaps on that other post

@James Wise agreed that is a concern I have with this approach...don’t want people thinking they can just stop paying me and I’ll pay them to move out. That is definitely something to monitor. In terms of making sure they were actually gone, we meet with the tenant at the unit to pay them in person (this was all facilitated by my PM, not me personally). If there is anything left in the apartment or it is not in broom-swept condition, they don’t get paid until it’s addressed. Once we verify the units been fully vacated and in broom-swept condition, they sign a lease termination agreement and we pay them the cash. So now if they go back onto the property, they’re actually trespassing and could be arrested as they no longer live there. We didn’t change the locks, but I suppose that’s something else you could do too as an added control. The tenants give you their keys, but I guess they could have made copies...

@James Wise I found cash for keys to be a viable alternative. Had a tenant out the unit by the end of the month that they didn’t pay and the unit was left in good condition which cost me $500 out of pocket to pay them off. I don’t live in the area, so eviction would have cost me $1,000 minimum in attorneys fees and the tenant would have been in the unit for at least another 1-2 months not paying rent and likely would have left the unit in worse condition. It might not always work, but this was our first attempt and it was pretty successful. The one downside is they don’t have an eviction on their record now so they could more easily burn another landlord and they made an extra $500 cash.

@Mike Buckley I figured as much...I know it’s off topic, but curious to hear a bit more about weekly rentals in that area. Is there good money in that? Why do that versus annual leases or monthly TAW?