All Forum Posts by: Sergey A. Petrov

Looking at your other post, it sounds like there are 8 tenants/roommates with an emotional connection to the property. The funds between all of you aren’t enough to acquire it. The rent roll doesn’t seem to support the valuation (otherwise it would’ve sold to an investor a long time ago). This is where emotional and business cross lines. If the 8 of you want to own it because you like it, are willing to overpay, and can come up with the money that is the way to go. Otherwise, I think you’ll have a very hard time finding an investor willing to make an emotional decision where the numbers simply don’t pencil.

Nobody is under any obligation to give anybody any contractor estimates. The way you hand the negotiation is a different story. Did you tell the seller we offered $205k but the estimates I have in front of me bring it to $172k? Did they catch you in a lie because your estimates are only $15k or are there other legitimate hard third party costs that bring it to $172k? Or maybe you said we did our due diligence, there are several hard costs, and many unknowns. We are still game and want to close but our number is more like $172k now to make sure we are able to navigate through all the now knowns and unknowns which will take longer than anticipated. We still have a deal and are willing to take on the risks that you won’t have to.

You would be limiting your pool of guests. Boutique hotels, etc that advertise and promote this will generally say “and oh by the way 1 of our 20 rooms may be haunted - guests reported something in room number 13”. Creates hype but limits it to just one of many rooms. 

Is that a legitimate guest as in my out of state parents / kids / friends just moving to WA looking a job that are staying with me for 3 weeks or is your tenant renting out rooms on a nightly basis? If subletting, not a good thing. I’d issue a notice to comply. If a legitimate guest, I’d let their parents visit them for 3 weeks

That depends on where you are in your investing career, how much assets may be at risk, how much insurance you are willing to buy and how you plan on financing your future acquisitions.

Lots of assets now + cash purchase on the next investment = definitely form an LLC.

Not a lot of assets + need cheap and easier financing on the next acquisition = hold it in your personal name and buy proper insurance.

something in between = risk vs benefit analysis 

Quote from @Isham Zabala:

@Sergey A. Petrov the dishwasher is only 5 years old

 Than your tenant broke it, hopefully you have the move-in checklist, and something from your appliance repair contractor that says it didn’t just fail on it’s own. Your tenant pays.

Quote from @Isham Zabala:

@Chris Seveney I tried to repair it and even tried to get a new part, but they don’t even make that same panel anymore or the same size

How old is the dishwasher and what is it’s depreciated value today? Charging a tenant $518 to replace a very old appliance that has no useful life left with a new modern appliance might be a stretch…a professional repair, assuming they can find the part, might be close to that $500 anyways

Quote from @Marco Gonzales:

this was not a scheduled outage, the tenant put in a maintenance request because her fridge outlet lost power, and her lights got dim, she turned the breaker box off and it wouldn’t turn back on. She informed us what was going on, we tried getting electricians to the property but it being July 4th weekend, they were either busy or closed. We put the tenant in a hotel for the next two days while we got a electrician to the property to fix the problem. 

The fridge loses power, the landlord says I’ll put you up in a hotel, you jump on the opportunity to stay at a hotel and leave your food behind? If and only if it is a great tenant I’d offer them a $200 gift card otherwise I’d tell them their request to not pay rent next month has been denied

Did the panel just fall off on its own? Sounds like someone broke something unless the dishwasher is 40 years old and pieces just fall off when you touch it. 

Knowing all this well in advance, it sounds like you did tell the tenant there would be no power. You also put them up in a hotel. A reasonable human would do something with the food in the fridge instead of letting it rot. If your tenants knew this was about to happen and did nothing to protect their own belongings that’s on them and there is no need to give them seven hundred bucks to restock the fridge!