Eviction stats ??

Question

hi i was wondering if any of you with low income rentals,, have kept track of eviction stats , i have a couple single family houses right now and i am comfortable in that area but a great deal on a triplex has come up and the only thing i am worried about is how often one can expect to have to evict someone. this fits the 50 % rule at $130 per door!,,  :  :D

Michael Rossi · Answer

Greg,

I do keep statistics on evictions.  When I was building my portfolio, I had an eviction rate of 1% per month.  Now that my properties are stabilized (meaning almost all of the tenants have been screened by me), my eviction rate varies between .25% and .5% per month (3% and 6% per year).

My primary screening criteria is that I don't take anyone that has an eviction on their record in the past 5 years or anyone that has a felony or more than 2 misdemeanors or any illegal drugs on their record in the past 3 years.  I check EVERYONE that will be living in the house.  I also don't care whether the tenant was actually evicted - the only thing that matters to me is that there was an eviction case filed against the tenant.  If another landlord needed to file an eviction case to get the scumbag to leave - that's good enough for me!!!  In the case of a felon, they must have been out of prison for 3 years.

Of course, you still need to contact previous landlords; their employer (if any), etc.

Finally, never 'work with' someone on a deposit.  They either have the first month's rent and security deposit IN FULL AND IN CASH, or they don't move in.

Good Luck,

Mike

Greg C · Answer

thanks for the answer,,, but come on throw a number at me  ,,, i have 100 rentals and i had to do 5 evictions last year 10 the year before  so my expected eviction is about 7.5% a year,,, you guys with multiple propertys must have a number
respectifully thanks!

Michael K. · Answer

Greg, my family specializes in lower income rental properties.

Evictions will depend entirely upon the tenant.  Scumbags who don't pay and trash places come in both wealthy and poor varieties.

Your best defense against evictions is TENANT SCREENING.  Have ALL applicants fill out an application.  Check with their previous landlords.  Verify income.  Run a background check that looks into criminal and civil (other evictions!) matters.  Also be sure that the potential tenant doesn't have outstanding warrants; nothing stops the rent from getting paid like incarceration.

I wouldn't bother with a credit check unless you have to do one to find evictions.  Low income people generally have trash credit; assume that they're all going to owe somebody.

Other than that, keep a clean property.  Trashy properties attract trashy people.

Have you considered rent assistance?  I've got three properties of my own in a municipality where the rent assistance is direct-deposited from the city to my bank account.  While I still have to chase the tenant for their portion, it's easier to handle chasing $40 of $925.00 than it is $925 of $925.

Mike

Account Closed · Answer

31 years of rentals, zero evictions, less than a dozen 30 day notices to quit.

I screen like a son-ova-gun.

About 50% of my low income applicants try to pass a friend off as their landlord.

I check ownership of rentals, don't use phone numbers provided by the applicant, google every name, do credit, criminal background, and eviction checks.

No one gets in without every penny paid before they get the keys.

My written criteria is 6 pages long and I stick to it.

I was just at the couthouse an hour ago-- applicant's "wife" has 3 evictions on her record. Sorry, rejected.

Michael K. · Answer

You're stricter than we are, but we've also got WAY more problems than you do!  I guess it all comes down to how much BS you're willing to handle.  In my cousins' case, they're willing to handle a LOT of BS.

Felons:  No violent felonies within the last three years.  Non-violent offenders can come right in, although we will check with their parole officer.

Sex offenders:  No non-consentual sex offenders allowed.

Drugs:  No manufacturing or distribution within the last three years unless on active parole with the recommendation of their parole officer.

Check forgers / bad check offenses:  If less than 3 years old, ALL payments must be in cash or in the form of a POSTAL money order.

Evictions:  Nothing current.  (We get LOTS of applicants who are in the middle of getting evicted.)  No more than one in the past two years.

Security deposits:  100% must be paid up-front unless they are actively working with a community organization that guarantees their deposit.

First month's rent:  Due at move-in unless through rent assistance or through a community agency that covers the rent.

That's about all.

Mike

Norm Chrostowski · Answer

Mike's the "Man", so he always gets a vote!
The other Mike gets a vote too! I agree completely about the credit check thing. If they were responsible with their finances, they'd probably not be renting in a low income area. Save your money, and look for evictions and convictions.

Call their most recent landlord, BUT MAKE SURE you also call their "second previous" landlord. That's were you'll get the real story.

Greg C · Answer

thanks mikeoh ! perfect ! come on you guys lets hit your numbers up against mikes and lets see if we can come up with a avrage,,, i like the 50 % rule but i really like to refine the process since i bring a lot of construction skills to the table and am learning management i like to estimate property a little closer

Eviction stats ??

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