All Forum Posts by: Shane H.

I would consider the value to income ratios on your investments and then yes I agree with the others and suggest you refi into a 30 year on any of the 3 that you keep. 

For example you said that Rental 1 has "a lot of equity". You don't say specifically what the value is, but consider what ROI you could get from the proceeds on that rental if you sold it. If you can get a greater or easier return by putting those dollars to use elsewhere, then consider selling.

The rule of thumb I try to follow is asking yourself if you'd buy each of your properties if they were listed for their current market value?

If rental 1 is worth (no idea just making up numbers here) $650k and you only owed $144k then you could take the extra $500k and earn a much better cash flow elsewhere. However if it's worth $250k, then $500 cash flow on that property would make more sense.

Hopefully this helps!

Hi Jake, i'm not an expert by any means but to answer your question the best I can you have the same net result. The "how" of what your doing would mostly be a question for your accountant or yourself if you have a preference on how you view your P&L's.

Your tax liability (again not an accountant here) stays the same if your income goes up the same amount as your expenses. how you are doing it now is perfectly fine. There are a few other ways you can handle it like job costing etc but again the net result is the same, it just comes down to how you want to view it on your reports.

Happy 2020!

Don't be afraid to offer a Bi-Weekly rent payment option, especially on C and D units. For example one of my units is $750 per month or $375 every other Friday (or whatever their day their payday is). They seem to pick the bi-weekly option more often due to it being easier for them to budget and there are two big advantages for me.

1) It equates to $812.50 per month instead of $750 (They are fully aware of this and are fine with it)

2) It means i get a 2 week earlier heads up if they are falling behind and can begin the eviction process that much sooner.

T his made me think of an add-on question to this. What about common areas on a multiplex? I have a triplex with a heated stairwell and common laundry. I'll be going to install lockboxes on the heaters this month but didn't think notice was needed due to them being common areas. It seems strange to me to have to give notice before accessing these areas but the question above is similar enough that i thought i'd ask your opinion on it.

Thanks!

Is your PM familiar with her or the agency she represents? Do some solid due diligence and eliminate any doubt before you commit to anything. Lastly, if your gut is still saying "no" then walk away. It isn't like you don't have other options to fill vacancies.

To rephrase your question, you're wondering if you should sell a property that is barely generating enough rental income to pay for a mortgage that is only on 60% of the value and in doing so would net you $150k-$200k that you could reinvest for immediate cash flow?

I think it would make a lot of sense to sell at this point and reinvest. Take the win you've had with the appreciate and use that further grow your portfolio.

Just my .02

I know this is something i consistently struggle with... I definitely don't look to make my rentals into marble and mahogany homes, but i do tend to over build, improve things that don't NEED to be improved, and spruce up things are are still functional but ugly.

Many of these things i justify by doing myself, but there are so many times when i have to step back and realize that the improvement i would like to make isn't necessary. I had to get over the feeling that every tenant is going to notice all the things i didn't improve as soon as they walk in.

I recently had my triplex appraised and while doing the walk-through with the appraiser we started talking about the old wooden windows and how i wanted to get them all replaced with new vinyl windows (this is in a C neighborhood). He just responded with "Why? they won't increase your rents or your appraised value..." And it was just yet another reminder that the improvements that i'd do to my home are not the same as those i should do to a business.

I agree with the above posters. Remember that just because you CAN buy something doesn't mean you SHOULD.

Thank you everyone for your suggestions! As an update, it ended up being one of the tenants daughters and she didn't tell him about it right away. He owned up to it and offered to pay the total. I countered due to his honesty (and wanting to encourage honesty in the future) to only charging half of what it costs to repair.

@Daryl Luc This is excellent advise, though in this case these tenants are inherited.

Hi Everyone!

I have a triplex that has a back parking lot and one of the tenants crashed into a support pillar hard enough to destroy it. I have been trying to find a vehicle with damages but I can't seem to be lucky enough to be there at the same time or it was one of their friends.

I am about 98% certain i know which unit it was, but I can't prove it. The unit i believe it is has had 2 complaints from the other tenants about partying and noise. I wouldn't be completely upset to lose them but if push comes to shove i don't know how i could enforce that they pay for the damages without evidence. Total cost to repair is going to be $600-$1000.

I can't really consider splitting it between all 3 as i'd rather take the loss than alienate two innocent units (even if it was one of the quiet ones that did it id' be alienating the other 2)

How would you recommend handling this?

Thanks!