All Forum Posts by: Sean McKee

@Kim Dillaway- You can certainly have your agent reach out for this kind of information. However depending on types of properties you are buying, the seller might not have all that information readily available. I purchased distressed buildings with so much deferred maintenance that I wouldn't trust any data they provide me. I'll take whatever information they provided with a grain of salt and then use my pro-forma data to make the offer price. I'll also check with the local building department for any permits issued, sometimes you need to submit a FOIA request. During the due diligence phase you can verify your original assessment.

@Allen W.- I own several C class properties. You can definitely increase rents by making the units slightly nicer. The key word is "slightly", so maybe 10% to 20% more than what would be typical for your market.  Also realize, unless the units were severely underpriced, you likely only get a 100 to 200 dollar rent increase. People in those markets typically won't pay that much more for premium finishes as they have limited budgets.

I had one unit that we just cleaned up and put new appliances in and got $200 more in rent. Most people just want clean and safe place to live. 

Good post. I think a lot of landlords, including myself, have been guilty of this to some extent at some point in our careers. Obviously this was an extreme case of letting stuff getting way out of hand. I think it's the fear of not wanting stir the pot. Some tenants cause problems, but not enough where you want to go through the headache of either finding a new one or take on the cost of an eviction.

It's not that you don't know what to do. You just don't want to deal with the costs associated of those actions and take the path of least resistance. At least you thought it was the easiest way forward until something else happens. By then it's too late and the tenant caused more damage than if you had acted earlier. It's not until then you learn the error of your ways and that you cost yourself more money, time, and stress.

I think COVID taught a lot of us the importance of tenant screening and not letting issues fester.

@Mary Aviles Lease Runner can accomplish it. You can run eviction, credit, and background separately. Of course it cost $49 which is like $10 more than Transunion. I've heard a number of brokers say they have the tenant initiate the report on Transunion and said it complied. But I'm not sure if this is true, because you get access to everything at once.

Splitting everything up just increases the cost to potential applicants, which I'm sure is the exact opposite of what they wanted. I hate having to charge more money and go through a longer screening process with applicants. A lot of them get confused when I split it up and charge more.

I don't think it was well thought out ordinance and I don't think a lot of people out there are complying with it. I guess we will have to see how they eventually start to enforce  it.

@Julie Batt- I paid total 1700, however the case was dismissed when the tenant moved out.

I think your property manager is referring to a forcible entry and detainer. You are going for straight possession of unit and not seeking money. I think it’s faster if you can’t locate the tenant to serve them. I could be wrong on that though. You should ask them what they mean.

If you have the tenants full name, Date of birth, and address (pretty sure you can use your property), you can report them more than likely. The social security number only helps further identify them. I’ve done it without a social.

I hope your current occupants decide to jump ship as well, now that the eviction ban has ended.

@Brian Walters- I only use methods like this when I want to make an offer quickly and don't have the time to do a full breakdown. I verify these numbers during the inspection phase to make sure they are accurate. I will also use them if I am just browsing through properties and want to make high level estimates. There are too many variables to rely on quick forms of estimating.

I would read a few books on estimating repair costs. Also hire a general contractor to give you an estimate when you do find a property you are interested in. It is very easy to underestimate repair costs. 

@Henry Lazerow- I certainly hope this goes nowhere. It seems to be more an anti-gauging legislation than anything else.  However if you increase rents 20% or more, the legislation wants you to pay relocation assistance.  I'm not a lawyer but  I think the fact that it doesn't prevent you from charging whatever you want is the way they are trying to get around rent control. Portland did a similar thing before the state passed rent stabilization laws.

@Connor O'Brien- I didn't read the document in detail, I actually didn't see the pre-qualification part. They are definitely trying to make it harder to screen out people.

@Jason DeVelvis- I currently use NestEgg and just recently signed up for their premium version that includes a dedicated property manager. It's 29 a month per unit. I had been using virtual assistants before, but once I saw they had property management feature, I switched over. 

The free version is pretty good. There's a portal that tenants can directly request maintenance. You have the option to use their contractors or your own(they will still coordinate with them). They will coordinate with tenant. They also offer leasing services, insurances, rent collection, and a few other things. Essentially they are working to become a one-stop shop.

The property management feature assigns you a rental manager. They can take calls, text messages, emails, etc. They can handle lease generation, attorney referral, etc. They however are not a traditional property manager. They are 100% virtual and do not actually sign anything in your name. There is no commitment, you can cancel at anytime. They are virtual assistant that specializes in property management. I have a good lockbox system in place, so building access it not an issue.

Companies like NestEgg definitely have the potential to put some of the lower caliber property managers that serve small landlords out of business. NestEgg has some areas it needs to develop more. The app itself is very glitchy, so I prefer to use the site. The rent collection feature makes it hard to track when rent will be deposited (ACHs take 5 to 8 days) and the accounting/reporting system is not very useful. Despite all of this, they have been a very helpful tool to have. They are a growing tech company and I suspect they will continue to improve.

Hello BP,

This post is mainly for my fellow Chicago investors.  I've heard about a just cause ordinance that is being proposed.  I took a very high level look at it and the proposal is quite ridiculous. For example, the landlord would have to pay up to 5 times the median rent if terminating without a just cause. The median rent would be set by the city. Yet the landlord can still increase rents up to 19% a year and not pay anything. So I'm not sure what this ordinance would accomplish, other than slowing down the inevitable and causing more headaches for landlords.

Has anyone heard any updates about this?  Is this likely to pass? With all the recent changes to the housing laws in Cook County, it would not shock me.

@Cristal A.- Everyone pretty much summed it up. 60 AMPs is not adequate for modern homes. From the photo you sent you have some old wiring. I've dealt with outdated electric a decent number of times.  All it takes is one outlet to go bad and then all the lights on that circuit start to flicker. You will go to try and replace the outlet and the cloth is all burned. At that point, you need to just rewire the unit. The problem with the outdated electric is it can be fine for years without any problems and then suddenly it goes bad.

 If you do have to do a full blown rewire/remodel, that will be hard to do with a tenant in there. It can be a very messy job and will probably upset your tenant. If you are legitimately going to bring everything up to current code and possibly do other remodel work, you might have a case for nonrenewal to make the required repairs. I'd contact a lawyer and make sure you actually do all the required work. If you just end the lease and rent it again without doing repairs, then it will more than likely be considered retaliatory.