All Forum Posts by: Steve M.

Start with what you CAN control. Your FICO and Heading out to your local REI clubs is something entirely in your control that takes little to no capital. Meet other investors, find someone who will take you under their wing, and while that's going on ~ clear up what you need to with your credit. Learn as much as you can before you ever decide to start ... 

Read this after my last post.

At the end of the day, if YOU feel incremental increases are the way to go, YOU may the decision.  Your PM is an extension of YOU.  You hired them ~ If they fail to comply, start interviewing new PM's.

@David J. has some good points ...

If I were in your shoes ... I'd have a sit down talk as well.  Go over the comps in the current rental area, and explain that you love her as a tenant and wish to see her stay on board, but you must raise the rent to more marketable rates.  See what she is "ok" with doing.  Whether that's $50 every 3 months, or 6 months, etc... etc...  I'd have a new lease spelled out with the new terms drawn up ~ go over them with her, and go from there.  If she balks and wants to move out, let her.  If she agrees, look at the bright side ~ you've got a long term tenant who has proven she'd like to remain such.  

If a long term tenant (18+ years) had 18 year old carpet, never complained about it, and paid rent on time.  I could care less about redoing the carpet or paint.  Whether she moves out tomorrow or 5 years from now, those items will still need to be done.  So whether or not she continues to reside there doesn't make much of a difference.

I could care less about the tenant being a hoarder.  And I feel a $150 increase (nearly 25% increase) demanded by the Landlord may fall upon deaf years.  See if you can reach common ground and raise it slowly :)

My $.02 cents!  Good luck and let us know the outcome! 

This ...

I would NEVER purchase and rent back to family/friends.  Business is Business, and if you are going to treat this as a business ~ I'd step out of the friend & family circle.

I've had no problem leasing my most expensive rental ($2000/month) without a fridge. Prospective tenants know right from the get go that they will provide there own.  You can tell some moan/groan about it, but I still haven't had an issue!

IMO ~ it really has nothing to do with the whether its a high end/low end rental.  And everything to do with the headaches that come along with appliances :)  The less appliances, the less headaches.  

Great Property ... hands down.

Quality of the tenant pool is everything to me.  I've been burned a bit too much on lower quality units and cheaper areas ~ and the headache alone, just isn't worth it to me.

I have a buddy who is the complete opposite.  He seems to thrive in area's like this.

Like all things ~ it comes down to the individual investor and what they are willing to do. Risk Tolerance plays a key role, as does whether or not you are willing to handle headache's on a daily basis :)  

That would quickly end the relationship I had with this group. I understand "overstating" the ARV, at the end of the day, they are trying to "Sell" these properties, and bank on unsuspecting newbie investors. However, if I'm familiar with the property PRIOR to you (the wholesaler) bringing it to me ~ its already off the table. If a wholesaler wants a payday, that need to make it worth my while. MLS listings (which I have access to myself) ~ aren't worthwhile.

My rule of thumb is nothing older than 1980 ... At that point, I don't have to deal with asbestos and/or lead paint issues.  I'm always weary of houses built in 78/79  ....

Reality is ~ I tend to look in the 10-15 year old range ... I almost always budget for HVAC, Roof & Water Heater repairs/replacements in the first 5 years.  

I plan to keep these rentals for 30-40-50 years, and therefore want relatively newer houses to keep up with me.  :)  I tend to stay away from full gut jobs now and invest in new & sprawling areas.

Welcome @Brett Fox

Going over your questions:

1)  2.1875% return ... Is that for 2015 alone?  If so, you're right on par with the S&P.  If that is for the past several years, you funds are underperforming ~ by a long shot.  (For reference ~ I invest heavily in Total Market Vanguard Funds, and I believe last year I was right under 13%)  Average safe withdrawal in retirement is roughly 4% (Adjusted for inflation).  This really isn't a question geared towards BP.  I've gotten most of my investment information from  www.bogleheads.org  Great resource, much like BP for Mutual Fund/Lazy Investor investing.  

2)  More details on the Condo are needed to tell you whether or not its a good deal, or what may be better.

If you decide to move forward in REI, plan several exit strategies if need be prior to getting started. Join a local REI club or association and attend some of the meetings. Learn your local market inside and out and go from there. Make sure to do your DD (Due Diligence) on everything.

Good luck!

Welcome @Daniel Zamora

Read up ~ Learn the search function well ~ and best of luck!  You're in a great area to get started!  Check @J Scott blog if you haven't already ... He's written some awesome books and got started himself down in Atlanta.  His site is  www.123flip.com  :)