Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Try Pro Features for Free
Start your 7 day free trial. Pick markets, find deals, analyze and manage properties.
All Forum Categories
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

All Forum Posts by: Steve K.

Steve K. has started 29 posts and replied 2763 times.

Post: California to make "Solar "mandatory for new Homes!!!!!!

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

Important notes about the CA mandate: 

The California Energy Commission (CEC) worked closely with the California Building Industry Association (CBIA) on this since 2008. 

Applies to new homes and MF buildings of 3 stories and fewer.

Also applies to major remodels.

Approved by CA Energy Commission 5 votes for, 0 against.

Approved by CBIA.

Includes flexibility for building designs/locations unsuitable for solar.

Solar panels do not have to be on the roof, if builders do not want to include rooftop solar in they can choose to access a nearby central community solar array. Community solar arrays are already widespread and available in CA, so shares can be purchased to virtually offset consumption just like one would buy energy from a coal, nuclear, or hydro power plant. 

Arguments for:

Reduction in green house gasses

Improves home owner’s cash flow position by lowering energy bills (estimated average of $80/month in savings)

Solar already widespread and cost effective in CA

Important part of overall effort for CA to get 100% of it's energy from carbon free sources by 2045

Arguments against:

Raises housing prices (expected to raise mortgage payments by ~$40/month on average)

Raises barrier to entry for home ownership

Will double the amount of solar on the grid by 2025, which will be problematic for utilities to manage

Info from the California Energy Commission Website:

http://www.energy.ca.gov/releases/2018_releases/20...

FAQ’s:

http://www.energy.ca.gov/title24/2019standards/doc...

Infographic:

http://www.energy.ca.gov/title24/2019standards/doc...

Post: Best paint to use to paint kitchen cabinets

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Michael Watts I have a great painter who uses Benjamin Moore ADVANCE. It takes a long time to fully cure, like a month, but once that time period is over it’s a very solid paint, almost like a lacquer. Tenants can cause some damage if not careful while it cures, so keep a quart on hand for touch ups. Very happy with this paint overall.

Post: I'm feeling like a bad person.

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Chris Hanisco

 Just think of it like this: the situation with the soon-to-be previous tenants will blow over relatively quickly, while your investment is long term.  In a few months when your building is rehabbed and stabilized with quality tenants paying market rent, you'll look back at this as a minor blip. It will blend in with all the other minor blips you'll have dealt with by then.

In the meantime, it may difficult to get your son to understand. I'd definitely get ahead of that, and explain how you're under contract, and that the contract stipulates the building be delivered empty. You need to rehab the building and raise rent in order to make enough money to pay the bank each month, and that's it. 

One piece of advice separate from this tenant situation: don't overdo the renovation. Classic newbie mistake (maybe even the most common one, and I'm in this club so don't be like me) is spending too much on rehab. It's tempting to go overboard making the unit really nice. But keep in mind that you may be redoing much of that work again sooner than you think, like during your next turnover even. So don't go full remodel, just do the minimal amount you need to get your targeted rent, using durable, cost-effective materials. Looking back I wish I had done less unnecessary remodeling, and definitely less worrying about tenant drama. 

You'll still be there leveraging your asset in the wisest way possible long after this drama is ancient history. You're making the right decision, even though it is the hard decision.  

@Chris Hanisco

Post: Seller will not provide bank statements in due diligence

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

The commercial lenders I work with do not require bank statements or taxes from the seller. We have to show our bank statements, taxes, and demonstrate that we have adequate reserves to our lender as borrowers of course. But all we need to get from the seller for underwriting is lease agreements/rent roll, estoppels, receipts for any recent capital expenditures and operating statements. I could see how getting bank statements/taxes to help verify the history of the building would be helpful, and it probably doesn't hurt to ask, but in my experience (4 plexes as well as small commercial 5-24 units) it is not a lender requirement nor is it customary.

 I personally wouldn't push the issue. I'm mostly concerned with getting a really good inspection, during which I'm on site the whole time going through crawl spaces, talking to tenants and collecting as much info as I can. Pro-forma rents are based on market data/how much updating I plan to do. Also I just always assume that one of the tenants is Mr. or Mrs. Murphy of Murphy's Law infamy, and have adequate reserves going in to account for that unavoidable fact. @Kyle Mitchell

Post: Thoughts on Murder house?

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Phil K. There’s a famous “murder house” here in Boulder, the JonBenet Ramsey house. It has not had a great track record in terms of being a liquid asset. The current owner lowered the price below $2M while comps with no murder were all over $3M. but still couldn’t offload it. It’s a beautiful house in a fantastic location too. The owner even had the address officially changed, which I though was a pretty good idea. Still no sale though, last I heard it was sitting vacant.

Post: Seller will not provide bank statements in due diligence

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Kyle Mitchell Profit and Loss (P&L) statements, Trailing 12 (T12), and Estoppels are common, sometimes Schedule E. Never heard of bank statements myself, and not sure I'd be comfortable with that as a seller. I only really like to show P&L/T12 and estoppels, because if the president doesn't have to show his, I don't want to show mine either.

Post: Im 19 years old with $160k. How do I invest?

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Gregory L. Nobody has mentioned this idea yet so here goes: but yourself a primary residence. I always wished I had the means to buy myself a house during my college years instead of renting. Part of this is because my college town had ridiculous appreciation. I would have doubled my money during the 5 years I lived there, instead of spending $30k on rent. This may or may not be the case for you regarding appreciation, probably not, but at the very least you can rent rooms to friends and make money instead of renting/living in the dorms (barf). Buying a primary is most people’s starting point, and probably makes more sense than buying a mobile home park that is priced too good to be true (major red flag in a high risk sector of real estate). As a homeowner you’ll get to learn all about the joys of taking care of a property and managing a college rental at the same time lol. Depending on what town you’re in, you might be able to just pay cash (but I wouldn’t spend any more than maybe $120k so you have adequate reserves especially considering you may not have steady income), or perhaps your parents would co-sign on a loan. Not enough info in your post to know if any of this actually makes sense for you or not, obviously you’d want to be sure the area has appreciation potential, and maybe you’re not even planning on staying at that school 4 years in which case don’t buy, but just a thought as it’s something I would do myself if I could go back in time and had that money at 19. Finally, whatever you did with your first business, do that again as many times as possible, sounds like that’s a much better gig than real estate!

Post: New Landlord advise.. Evict? Or wait it out...

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Jeremy Mattson you’ll want to check your local quidelines for specifics on your jurisdiction. I’m only familiar with my own state. In CO, posting on the door (in addition to mailing it), serving in person or sending via certified mail are all legit methods. The certified mail receipt is proof you served the notice, or at least made every effort to, and since she paid the late fees on the ones you posted to her door, that probably qualifies as a acknowledgment of receipt. When serving in person, I have the tenant sign the bottom of my copy and their copy, and I sign too in acknowledgment of it having been served on that date. It can also be served to anyone at the property of suitable age so you could serve her kids if they’re 18. That’s weird the certified mail couldn’t be delivered, not sure what happened there, maybe she refused it or something. Since she’s your neighbor I’d just post on the front door as well as any other doors, make it unavoidable to see, and drop a copy in her mailbox or wherever she gets mail too. Being her neighbor you will probably know if she’s seen the notice. Any judge should accept that if you’re certain she saw it and you made every effort possible to deliver it. If you’re in doubt you could have a professional serve it. Again, check your local laws, just read everything in your local tenant-landlord handbook regarding evictions as well as the Nolo website for your state. Having a record of when she paid rent and/or late fees should be enough documentation to establish chronic later rent payments but definitely follow protocol according to your local guidelines.

Post: New Landlord advise.. Evict? Or wait it out...

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

@Jeremy Mattson Well that makes it as easy as possible for you psychologically; you shouldn't feel bad about evicting someone who has already exceeded the limits of charity from their church and even their mother. My case was the same in that way: she even had a grant program for single women willing to pay her rent, she just never filled out the paperwork. I attempted an amicable split, offered to waive the late rent plus late fees and even offered her a week more free rent to get out if she went peacefully and didn't damage the property on her way out. I reminded her that if I had to evict, having that on her record plus garnished wages and ruined credit would make it impossible for her to get another apartment. But she didn't take my offer. Maybe she thought, "I'm a single mother, they won't just kick me and my kid's butts out in the street." I included all late fees, court fees, lease violation fees, and damages in the Notice to Pay or Quit. Surprisingly she actually showed up in court. I stuck to the facts and kept it extremely simple: she was chronically late on rent, hadn't paid her utility bills, and I wanted her out so I could replace her with a more responsible tenant (I didn't even get into the lease violations, as I didn't want to). When it was time for her side of the story, she launched into a litany of excuses. The judge literally cut her off mid sentence, Judge Judy style, and simply asked, "Can you be out tomorrow on your own, or do I have to get the sheriff to forcibly move you out?", and that was that. 

Maybe this is the rock bottom moment your tenant needs to get her act together. Anyway, not your problem. The eviction will be over before you know it, you'll learn how to do it, and you'll feel so much better after it's done with the unit rehabbed and a quality tenant in place. Sounds like you're bootstrapping so you probably don't want to pay a lawyer. Just look up the process on your court jurisdiction's website. It's not that hard in my experience and all the forms are right there. With unpaid utilities, lease violations, and chronic late rent that you've served notices on and documented, it's a pretty cut and dry case. Just follow the process exactly as your jurisdiction requires, don't deviate at all or you may have to start all over.  

My main take away from my first eviction was realizing the importance of serving notices to pay or quit and charging late fees immediately every time rent is late beyond the grace period. I'm not rude about it, I usually don't even talk to the tenant but if I do I just say "Company policy. We need you to pay on time so we can pay our own bills including the mortgage for this building on time. Banks don't tolerate late payments so neither do we." If the tenant pays, great, I halt the eviction process. Late fees equal more revenue plus I've got documentation of the late payment that I can use if I need to evict down the road. If they don't pay, the eviction process has already begun so lost revenue is minimized. As far as lease violations go, they just get the one written warning along with a hefty fine. Failure to cure or subsequent violation results in automatic eviction. It's so much easier to just serve notices than it is to track people down, listen to excuses, haggle over details, etc. I don't do any of that anymore. It's simply business. It sounds like you're already on the right path since you mentioned you served her notices, so you're off to a solid start. Good luck! 

Post: New Landlord advise.. Evict? Or wait it out...

Steve K.Posted
  • Realtor
  • Boulder, CO
  • Posts 2,866
  • Votes 5,106

I’m not a huge fan of cash 4 keys, personally. It just rewards bad behavior and trains people to become professional tenants. But it’s cheap and easy to evict where I operate, so I’d rather pay the nominal court fee than the tenant. Depends on what the eviction process is like in your neck of the woods I guess. Most tenants get out once the notice to quit is served, and it doesn’t go to court anyway. It could be worth just asking her politely to leave, point out that it’s become obvious she can’t afford the unit seeing as she’s always behind on bills, explain that you are hoping to remodel the unit anyway, and give her a few weeks to get out. If you can keep it amicable that’s ideal, but I wouldn’t hold my breath. Even if you do reach some sort of agreement like that, I would start the eviction process anyway so that when the day comes for her to move out, and she hasn’t moved out, at least you’ll be that much closer to being able to evict. If you make a cash for keys offer, don’t pay her a cent until she’s completely out, the unit is clean and the locks are changed. If it’s comes to eviction, follow the process exactly as your state requires: stick to the lease violations/evict-able offenses, don’t get dragged into any bs or accept partial payment, follow the process exactly as your state requires all the way through. I hear you on the single mom thing, it’s tough. Unfortunately in my experience a high percentage of renters are single moms. In fact my first eviction was a single mother of 2 in a very similar situation to yours where she started sliding downhill by not paying her utility bills. I got a service call for her furnace and when I got out there I couldn’t figure out what was wrong with the furnace for about an hour until I realized the gas company had turned her gas off at the meter. She told me every excuse in the book, including that she had just been diagnosed with throat cancer. I talked to her boss and her doctor, it was all lies. I should have evicted sooner.