Rental Property Investor 路 Ankeny, IA 路 Member since 2017 路 2k+ posts 路 3k+ votes
6y
@Steven Jackson I used to live in Sacramento, just up the road from Stockton. Make sure you are very familiar with Stockton, and the exact neighborhood where this is. First, the fact squatters live there might give you a clue as to what kind of neighborhood it is. Second, when I lived there (10 years ago), there were some very bad areas of Stockton. Sure, many people thrive owning D class properties. But, many also do not.
My own stomach doesn't handle below B class properties, so take my advice with a grain of salt. But I would be very worried about buying a property and then not being able to evict for months and months after closing. If you have no experience with this, then I would say this isn't a good prospect for you. Unless you have a good team on board that does have experience.
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Suzanne Sevier No, the home is occupied by multiple different people. The seller allegedly gave them cash for keys, but they came back. He now wants to sell the home with the squatters in it. The new owner would have to evict using unlawful detainer, however I'm not sure how Corona Virus may have affected my ability to get them to leave legally, so I'm wondering if the deal is worth the hassle. I stand to make close to $50,000 after repairs and fees.
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Anthony Wick yes this home is in Stockton, CA. My concern is that I won't be able to evict during covid-19. I'm not sure how the laws passed would affect my ability to enforce an unlawful detainer
Rental Property Investor 路 Ankeny, IA 路 Member since 2017 路 2k+ posts 路 3k+ votes
6y
@Steven Jackson I used to live in Sacramento, just up the road from Stockton. Make sure you are very familiar with Stockton, and the exact neighborhood where this is. First, the fact squatters live there might give you a clue as to what kind of neighborhood it is. Second, when I lived there (10 years ago), there were some very bad areas of Stockton. Sure, many people thrive owning D class properties. But, many also do not.
My own stomach doesn't handle below B class properties, so take my advice with a grain of salt. But I would be very worried about buying a property and then not being able to evict for months and months after closing. If you have no experience with this, then I would say this isn't a good prospect for you. Unless you have a good team on board that does have experience.
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Anthony Wick this would be a flip, my main concern is whether the new laws pertain to the squatters and would delay my rehab and ability to turn the property around for a profit quick. I've done rehabs before, but this would be my first squatter situation during Covid.
Rental Property Investor 路 South shore, MA 路 Member since 2017 路 1k+ posts 路 1k+ votes
6y
The fact that there is no lease or rental agreement, chances are you can have them removed by authorities. That would be my guess since they were never tenants in the first place. But check with the police and an atty.
Check out this website and call, they will tell you exactly what you can and can't do. I'm going thru a similar process with a house that I bought at a tax sale in Texas in March that had a lady living in it rent free for 4 years since the original owner passed away. I had to wait over 2 months because of covid-19 before I could file a Notice to Vacate and then had to wait 30 days after the notice to file for eviction. Still worth my time and trouble though.
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Mike Kirby thank you. Great info. My concern is that I will have more holding costs and I want this property rehabbed and sold within this year. I'll look into the link you provided. Thank you again.
@Suzanne Sevier No, the home is occupied by multiple different people. The seller allegedly gave them cash for keys, but they came back. He now wants to sell the home with the squatters in it. The new owner would have to evict using unlawful detainer, however I'm not sure how Corona Virus may have affected my ability to get them to leave legally, so I'm wondering if the deal is worth the hassle. I stand to make close to $50,000 after repairs and fees.
"The seller allegedly gave them cash for keys, but they came back." and this is the problem with cash for keys. You are giving money to a thief so don't be shocked when they screw you. Cash for keys doesn't give you legal rights to the property, only eviction does. In fact giving them cash may have legitimized their claim. Eviction of "all unnamed tenants" is your best path and with evictions frozen through potentially the end of the year, it could take a while. That $50,000 profit could disappear after carrying costs and attorney fees.
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Joe Splitrock that was my train of thought as well. I don't want to sit on a property when the affects of the Corona virus in the future are unknown, but are expected to be bleak.
Lender 路 Milpitas, CA 路 Member since 2016 路 376 posts 路 248 votes
6y
@Steven Jackson I definitely recommend that you speak with an attorney that specializes in evictions. Like @Brian Ellis says, since there's no lease, removing them should be a simpler process than if they were tenants. Let me know if you need an introduction to an eviction attorney.
Investor 路 Marin County California 路 Member since 2018 路 1k+ posts 路 2k+ votes
6y
Not telling you anything you probably don't know already but people who will accept cash for keys and then return to the property have little respect for persons or property. Consider what damage they can do to the property on the way out even if you CAN get them evicted in this environment. I can think of ways to inflict $50,000 worth of damage with a crow bar and a bag of cement.
There is zero chance I would buy this property unless I receive a deal so good I could hold on to it for 2+ years before receiving possession. With the state of the economy influx, my number would be somewhere in the range of 25% of the current value
No, the authorities are not going to help as they have possession. They are going to tell you this is a civil matter. I remember a BP member having an eviction in California take 5 years on a property he purchased.
Bottom line is....even at 25% of value this might not even be a deal
Menlo Park, CA 路 Member since 2018 路 42 posts 路 21 votes
6y
@Greg H. Good suggestion. Thank you for your comment. The ARV is $250,000 the current market value is probably about $170,000, so I would need to get it for about $127,500 based on what you are saying. Noted 馃槈
@Greg H. Good suggestion. Thank you for your comment. The ARV is $250,000 the current market value is probably about $170,000, so I would need to get it for about $127,500 based on what you are saying. Noted 馃槈
25% of value is $42500
Look at it this way, if it were so easy to get them out, the owner would do it
Rental Property Investor 路 Henrico, VA 路 Member since 2019 路 265 posts 路 155 votes
6y
@Steven Jackson I would suggest no. It can take awhile to get folks out and from what I've read here on BP, California is particularly difficult. Add to that the eviction moratoriums that many states have put in place (when does the moratorium in CA expire? Will it be renewed?). Then there's the HEROS act (see other thread on BP), which would put in place a national eviction moratorium for 12 months if passed (it passed the House already). So, as @Greg H. mentioned, it seems doubtful the profit would be that much and go according to plan.
I would give it a year timeline to evict tenants judges are going to be very friendly to landlords... also they can file bankruptcy and slow you down.. unless you buying cash and waiting for them to leave I wouldn鈥檛 do it..
I just bought a house that is worth 1.5 for 550 exact same situation beside them moving back in... except I have to evict 3 tenants and you can鈥檛 start the process to August 20th in New York City where my property is at...
I bought the deal cash
Nothing worse than making payments on something and you have no end in sight