All Forum Posts by: Zee Abbas

@Jack O'Jack I would echo everyone’s advise so far. I was your age when I bought my first property and made some mistakes (some wins too) including not really being prepared for the scope of work I was tackling. Fortunately, I was occupying the property at the time and knew the trades so was able to cut some costs. This is your first deal- you should fly down to Midland (an oil town) and put hands on the property. Walk it through during the day, walk it through at night, drive through the neighborhood in the morning and again at night, so on and so forth. This time investment will be invaluable to your future in this business. You’ll need to develop the “eye” and get actual experience to get good with #s and this is where to start. At the end of the day, would you buy a $75k car in the hope that you can flip it for $30-50k without seeing it first? Most rational folks would say no, and this isn’t anything different.

@Hoi L. I have a property down in Louisiana that is on the edge of the a flood zone. Flood insurance isn’t too bad and the property is raised so it’s not the end of the world for me but buying a non-raised property would be a complete no for me. Even then, every time a hurricane comes by, I wonder if the street is going to flood or not. I figure that even if a prospective property floods once in the next ten years, I would almost wipe out a good chunk of cash flow I’ve built up due to that one event. Having to free the tenants from the lease, contacting insurance and waiting on their timelines, then doing the actual repairs above the deductible and lastly placing good tenants back into the property is such a massive headache. Glad your moving on from it, best of luck!

Any property that has flooded twice in the last 3 months, will flood again in the near future. Did the property have flood insurance? If not, the damages will not be covered by the standard home insurance policy. Future flood damage will heavily eat into your cash flow and give you headaches. I would pass on it and focus on a different property. 

Why not have a weekend plumber give you a labor only price?

The decision to replace or fix for me really depends on the age or issue. Old unit or burnt compressor? Replace. Leaking ceiling? Looks like the condensate drain line needs to be flushed out, which is just a regular PM. While the techs there, have him install a float switch so the unit will not start until the water level drops. May need to replace the indoor fan capacitor on the one with low airflow. All three can be done in a 1.5 hr service call. Have the other guys come in and give you quotes but you probably don’t need to replace anything at all. I’d start doing these basic PMs every season to keep the emergencies at a minimum. Besides, 10k is pretty expensive for a standard 3 ton mini split.

I do a walkthrough quarterly on my properties. Even though changing filters are the tenants responsibility, I have found that most of the time they are not changed and if they are, changed right before the walkthrough. At this time I also take care of small items to fix or repair that the tenants hadn’t reported.

@Peter Morgan glad it worked out for you!

I’ve been in a similar spot with my first rental property. My tenants moved in August 1st and by the 3rd, the AC unit stopped cooling, despite working perfectly fine since I had purchased the property. Being a remote and first time landlord it was difficult getting the problem fixed even though I had a good idea of what it was. I ended up giving my tenants a week of free rent to offset being a week without AC. In hindsight, this was probably an over reaction but at least it gave me peace of mind. Like @Scott M. mentioned, I would install those window units to at least have cooling. At the end of the day, it’s your property and maintenance isn’t some magic wand that can be waved and have all your problems go away. I would not pay for a tenant to temporarily stay in a hotel either. It’s clear you are making your best effort to do timely repair. Now, speaking as an HVAC contractor, I have a 1 year parts and labor warranty on all of my installs at minimum. The company that installed the unit should make good on their contract. Once they fix the problem, I would have the guy you trust do a once over to make sure everything looks right. I also don’t quote aggressive timelines like “4 hours”. “4 hours” is corner cutting territory- did they braze with nitrogen? Did they flush the line set? Did they pressure test and vacuum the lines before charging? These aren’t questions that can be answered anymore unfortunately. With my experiences I’ve taken the proactive maintenance approach- this year I replaced the hot water heater proactively so I wouldn’t have to deal with this situation. I may be changing out a unit 1 year early but ultimately passing up $100 in “life” is well worth the headache of having to do a replacement in a bind. Good luck and hope you get this sorted soon.

I have to agree with @Jack Butler. Investing is a game of patience. I understand that you have been outbid on multiple properties but you don't want to put yourself in a position where you are barely above the water financially. Are you sure the property will pass an FHA inspection?

I just did a 2.5 ton indoor-outdoor (not heat pump) install with new lineset w/o ducting for a customer for $6k + tax. If you are only replacing the outdoor, this seems too high to me. An outdoor unit on it’s own is not >$3k in materials. If it’s both indoor and outdoor then $5k is reasonable. We don’t know how old your stolen unit was or what refrigerant it used so I can’t advise on whether to replace just the outdoor or both. Also I second the cage idea. I have a cage installed on my rental property and I am still able to place high quality tenants. The cage is a left over from before the neighborhood improved but I figured I would leave it there just in case.