All Forum Posts by: Amy A.

Don't let mice deter you.  Get a quote for a yearly contract from an exterminator and include it in your operating expenses.  This may cause you to reduce your offer, but you should still make the offer.  After a few years of dealing with tenants, you'll look back at this and laugh at how easy this problem was to solve compared to the ones they'll throw at you!

Assuming it's in a good area, a 7.8% cap rate isn't too bad right now. When I buy a property, I include a vacancy rate and verify all expenses. Call the city to verify taxes, call the electric, water, trash, insurance, plowing and oil/gas companies to verify expenses. Find out if rates are going up for 2020. They probably used rates for 2019. Assume a % for repairs/maintenance and CapEx. Once you get the real NOI, offer around an 8% cap rate. Years ago I offered 10%, but that's hard to get now. At least interest rates are lower to make up for it so your cash on cash return should be good. I look at % returns, not a certain $ amount per door. Also, don't expect to make much cash flow the first year because inevitably something will come up. Also, make sure there's nothing holding back the rent increase - such as a lack of parking, extremely small rooms, etc. Once you have all your data confirmed, make your offer with confidence.

Unfortunately, this is normal in real estate investing.  It can be frustrating as you acquire more properties and don't seem to make any money, but over time it's worth it.  It's a "get rich slowly" process. Once you have several properties, assume that one of them will not make a profit each year.  This is fine, since the others cover your expenses and allow you to make a comfortable living.  Spreading out your risk is important.  Hang in there!

Hey there! The AG's lease is very slanted toward protecting the tenant's rights but not yours!  Atty. Shankman has a great Maine lease.  I'm not sure how much he charges for it.  It was in a book I purchased for a class I took a few years ago. You can probably buy the book, which includes other forms and info, for a few hundred dollars.

If it has gone up in value, don't forget to harvest your tax free capital gains! You must have lived in it 2 of the last 5 years.  Do the math and see if it makes sense to sell before time's up.

@Maya Torres wouldn't it be great if screening reports told you if applicants smoke?  I've been thinking of buying a retired drug-sniffing dog and having it screen my tenants, lol!

Nobody has mentioned lead paint.  It's a big problem where I live.  If a child in your unit tests over the limit for lead, inspectors will go in and test the unit and will probably find lead paint somewhere, typically in the windows.  They will be forced to move, at your expense, and you'll have to get on the waiting list for a licensed lead abatement company to go in and charge you about quadruple what it should cost to make it "lead safe".   This could be another reason to replace old painted wood windows with vinyl while units are empty.

I recommend Rob Reinmuth as your Realtor.  He is also an investor and I think you'll enjoy working with him.  I can't post his number here, but you can google him.  Tell him Amy from Maine sent you!

It's a duplex.  You know it's her because the other tenant wouldn't tell on herself!  When this happened in one of my buildings, I went into the complaining neighbor's unit and smelled the odor myself.  That way I could testify in court that I actually smelled the odor and it also protected the neighbor from retribution because I didn't have to say there was a complaint.  Just start the eviction process and don't let the issue fester or you'll lose your good tenant.  Yes, the smoker will deny it.  As landlords, we get used to people lying to our faces.  I've had them deny it even when I had photos of the cigarettes in the apartment!  She's not going to stop smoking.  Sorry, this is a bummer, especially when you just placed the tenant!

Sorry, I backed out of the deal after I went to a planning board meeting to get approval for the conversion to mixed use. Not only did they reject us, but the major tenant was there getting approval for a new building!  The numbers didn't work without that tenant (Domino's Pizza). So, I never got final numbers, but good luck with your project.