I am really touched by all the help I get from the BP community. I’d like to write down my experiences after purchasing 2 rentals from Roofstock. Hopefully, it’s useful, and that someone, somewhere will benefit from it.

Our 1st rental in SC:

I first heard of Roofstock at the Home Union and some other turnkey companies from BP. After a bit of research, I liked Roofstock better. The website provides due diligence vault that has inspection reports, PSA, and tenant info for reach rental home that comes with a tenant. Their certified process sounds convincing. I am willing to pay 0.5% as a buyer for the research that they did for me. In May 2018, I pulled the trigger and purchased a home in SC. It’s very easy to send an offer from their website. Simply enter the price, your credit card number and submit. Your card won’t be charged if the offer is not accepted. Asking price is 103K, current rent is $1100, 3-star neighborhood. Got a counter offer the next day for 115K. I was very eager to get this deal and I like the home is in a quiet court, so I accepted it. Pretty sure I overpaid it, but I am happy that I finally got started.

The entire process was very smooth. They held your hand every step of the way. Only a bit drama at the end. One day before the closing day, the title company was supposed to Fedex the original closing docs overnight, however, we were asked to print them out ourselves at the last minute. On the closing day, we went to a notary center and a lawyer in SC called. He walked us through all the documents and answered all our questions. We signed and notarized on the spot. We also paid extra because SC requires a third-party witness signature. The next day, our title company said our documents were not good because our home printer default setting prints double sided, so the closing package was printed out on both sides. We had to do the closing process all over again. It delayed the closing by one week to the end of June and we paid the notify + witness fee again. When we casually mentioned it to Roofstock, they refunded me the notary fee from the 2nd time.

I signed the agreement with the MPH (Marketplace Homes), one of the certified PMs on their website. Monthly PM fee is $90. So far, there’s 2 repairs. One is about $100 to fix a lock on the back door and replace a toilet seat. Another one is $325 to replace the garbage disposal. It’s leaking every time it turns on. I feel that the price is a bit high to simply replace a garbage disposal.

MPH usually sends an email with a work order if they receive something from the tenant. Then you can simply approve to authorize MPH to fix it, or you can handle it yourself. I always ask for BEFORE and AFTER photos for my records. Sometimes, they can only provide AFTER photos.

The lease ended in Feb this year. It’s already been renewed to Feb 2020. I didn’t increase the rent price. I calculated it roughly -- the profit is about $500 after 6 months, from July to Dec. I am sure some people think that this is not a good deal, but I am OK with it. I won’t buy again in SC though because the property tax is way too high. On the Roofstock website, the estimated property tax is about $2800. The escrow account statement shows about $3100 was paid out at the end of Dec 2018. 

Our 2nd rental in MO:

In Nov 2018, I submitted an offer ($53,500) on Roofstock on a Saturday. Asking price was 55K, 2.5-star neighborhood. 2 bedroom and 1.5 bath, close to 1000 sqft. Market rent was $800. It was accepted on Monday. Buyer’s remorse! Oh well.

Since it’s a cash deal, it should be able to close in 15 days. However, the seller pushed the closing date again and again. I was told that the city requires Occupancy Certificate. The inspection with the city was scheduled by the seller but rescheduled. I had a bad feeling about it from that day. Finally, the Occupancy cert is provided by the seller. It shows PASS but quite a list of violations. Roofstock confirmed all violations were fixed and addressed by the seller. By law, it must list on the certificate. So, nothing to worry about.

The home was closed smoothly on Monday, Dec 17. No drama this time. The Roofstock agent is very professional. She always replies my emails quickly, even during the weekend. She’s the bridge between the seller and myself. She calls me if the situation is urgent. She’s very comfortable to deal with. A few days after closing, a guy introduced himself by email: Michael from the Roofstock customer satisfaction department. He asked for feedback etc. I believe this is new because it’s not a part of post-closing process when I purchased my SC home. I feel Roofstock is growing and improving.

Roofstock provided two PM companies in MO. MPH is not listed as a certified PM there. I asked Roofstock if it’s OK to sign up with MPH and still get the rent guaranteed program. Roofstock agreed. To me, the rent guarantee is a new program that I’ve never heard before. What I understand is that after 45 days of closing, Roofstock will pay 90% of the market rent if the vacant home is not leased. This program helps me a lot later.

On Friday, Dec 21, A marketing manager from MPH reached out to me for questions. MPH suggested giving a $200 incentive for the first month since it was the holiday season, raising it up to $800 after that. I agreed.

On Thursday, Dec 27, MPH confirmed that a photographer will be sent the next day to take photos. Unfortunately, the photographer didn’t find the lockbox on the property. Anyway, a lot of back and forth. On Monday, Jan 7, the home is finally up and live on Zillow. MPH did a pretty good job by virtual staging the home, looks very good. See example:

The leasing manager from MPH reached out. We would have a weekly call or email communication about the viewing stats etc. A week later, I was told total 12 visits in 7 days. It's the most popular home among all the rental properties MPH is managing at that moment. It takes 2 - 3 weeks average to fill a good tenant. Based on the leasing manager, the rent is reasonable.

In the meantime, I found out there’s no way that a dishwasher can be installed beside the sink (red arrow) because there’s not enough space. I asked MPH to give me an estimate for removing those 2 drawers and install a dishwasher.

On Thursday, Jan 24, MPH sent a contractor to the home and found out the house is too cold. Turned out the gas was turned off around Jan 19. I called the gas company and setup the appointment the next day between 7:30 am to noon. The gas company only called my PM once 15 min before they show up at the door. There must be an adult onsite. And my PM missed the call. After many calls with my PM and the gas company, the contractor, sent by my PM, was waiting in the cold house for several hours. Finally the contractor met the gas technician on Friday afternoon. But the gas cannot be turned on because it cannot hold the pressure. The temperature was at 12F and the winter storm was coming.

The plan was to ask the contractor to drain the water as much as possible and winterize the home on Saturday. My PM would send a plumber/gas technician to fix it on Monday. I learned a few things that day: the water was turned off too, my PM is NOT local (she had to do research to find local plumber/gas technicians), and I was not sure how easy it will be to find the leak and how much to fix the issue.

Monday, Jan 28: Plumber/Gas technician started working on it since the morning. I only got an update at the end of the day from my PM: "Unfortunately, he was not able to find a leak with the testing done in the pipes. He believes there is a pin hole in one of the copper pipes. He stated that some of the piping is behind 2 x 4 in the wall, so they are difficult to get to. He had every branch capped off and even disconnected it at the meter to test. He had the water heater, furnace, and dryer capped off and couldn't find it in the pipes. He did confirm it is not pressurizing still, which makes him believe there is a pin hole. With your authorization, he can go back out tomorrow. Tomorrow he would be able to come back with an air compressor and listen for any whistle or leak in short sections like before. Otherwise, he would be able to reroute it, which means he would be able to tie on and run a new line to get it to pressurize. Please let me know how you would like to proceed. " The quote is about $1750 for Monday and $3000 more the next day, WITHOUT any guarantee to fix the issue. :-(

I didn’t authorize my PM to go ahead. I was frustrated. I wrote an email about the whole thing to Roofstock. Michael called me right away to understand the whole situation.

Tuesday, Jan 29: My PM was not responding. I called the sales in MPH instead and asked to get firm quote on replacing new flex pipes. He said he would talk to his team and get back to me. Later in the day, I called and emailed, but there was no reply. I feel like both my PM and the sales from MPH simply fell off the face of the earth. Not sure if it’s because of the winter storm. That evening, I posted my situation in BP and got lots of useful tips. Thanks BP! I also looked up the certified LOCAL PM on Roofstock website in MO and decided to call the next day.

Wednesday, Jan 30: I called the local PM who sent me his plumber guy and this plumber saved my day. He confirmed the leak is hidden. $600 to replace a section, $1100 to replace all pipes, not including fixing the dry walls. I chose to replace all pipes.

 Long story short, by Sunday, Feb 3rd, all pipes were replaced with black iron, and flex parts were connected to the stove. The plumber also saw something the gas company may not like about the furnace. The flue pipe touched the wood door to the utility room. It’s a safety issue. He fixed that too. By Tuesday, Feb 5th, GAS IS ON!

I fired MPH by cancelling the agreement with 30 days’ notice. Roofstock cannot provide any legal advice to my question: do I need to wait 30 days to sign up with a new PM? I totally understand. Anyway, I waited 30 days to sign up with this local PM to avoid any legal issues.

Friday, Feb 8: I scheduled the water company to turn on water. No need to have an adult on site when turning on the water. I hired this plumber anyway to make sure that there’s no leak. Unfortunately, it’s LEAKING. The plumber turned off the main water valve. He fixed it the next day, also replacing a broken regulator.

Michael from Roofstock supported me through calls and emails during the whole ordeal. He mentioned Roofstock can cover some of the cost. It took a lot of pressure off of me. He also gave me lots of useful suggestions, updated me when the guaranteed rent would show up in my bank account, chased my new PM to update me about the leasing statuses and a lot more. In short, here’s the list and who paid for what:

• $138: Service trip to measure dishwasher etc by MPH, paid by me.
• $660: Winterize home by MPH, paid by me.
• $1750: Troubleshooting the gas leak by MPH, paid by Roofstock.
• $1450: Replaced all pipes + fixed safety issue, paid by Roofstock.
• $660: Leaking fixed by the plumber, paid by me.
• $1450: Fix dry wall + repainting, paid by me.
• $150: Professional cleaning, paid by me.

In early March, the guaranteed rent for Feb was paid by Roofstock as promised. The March rent is on the way. I like their guaranteed rent program. It give me time to work with my new PM to screen and find a good tenant.

In conclusion, I will continue to purchase rental properties through Roofstock. I am glad that they are growing. Since December 2018, they introduced several new programs such as property tours in Atlanta, San Antonio, Roofstock One, Weekly webinars that I tried my best to attend and learn, bring your own property program (BYOP) etc. Maybe I will share more in the future!

Thanks for reading and happy investing!