What to do when taking over occupied 4 unit

Question

I am excited to be closing on my first 4 unit soon.  All of my properties previously have been unoccupied, and this is fully rented.  What advice can you give to a first timer? I am working on a checklist for the new place, and I am sure I haven't thought of everything.  I never do!

Trevor K. · Answer

Thanks.  I will go over the leases with the tenants.

Ramon Jenkins · Answer

congrats

Anthony Gayden · Answer

@Trevor K. I hope this works well for you. I prefer multi-family for a number of reasons

Jarrett Harris · Answer

@Trevor K.

1. Make sure every tenant has a lease

2. what is allowed and what isn't

a. pets, smoking, number of people in the unit, amount of security deposits, amount of rent/month. When is rent due, late fees. What is the tenant liable for?

Trevor K. · Answer

Thanks @Paul B. That is good info.

@Jarrett Harris Cap EXs are looming, but nothing needed in the next couple years.  Boiler is new, so that is good.  Confirming the leases is new to me.  I think I know what you mean, but could you explain it?

I am trying to avoid what Paul B. was saying about tenants getting bent out of shape, and I am looking for guidance about making the tenants happy, while still transitioning them to my way of doing things.

Jarrett Harris · Answer

Congrats. The above advice is good. I bought my 4 unit 6 months ago 50% occupied. 1 tenant has been very good. The other is a professional tenant currently waiting for eviction. Confirm everyone's lease and make sure you don't have any professional tenants. Any Cap EXs coming up this year or next for your property? How are the furnaces/boilers, water heaters and the like? Any pictures?

Paul B. · Answer

@Trevor K. ;

Hi and congrats! As I took over my 4 units, the change in ownership ruffled the tenants, for reasons I will never fathom. Some quit paying or moved out. Something to watch and be prepared for.

Timothy Riley · Answer

Congrats!!!

Justin Mills · Answer

Yeah im a buy and holder myself too.

something to consider...... you could get solar on you property and include electric in your rent. Im doing this and a get an ext ra200 for electric per unit. My bills arent anywhere near this. It is a big help to my tenants aswell. peace of mind for them i guess.

If you can afford it buy new a/c units. I have old ones and they are a hassle. Some stupid little thing is always malfunctioning.  I will be replacing them this year though.

Also, make sure your plumbing is robust and tenant proof.  I have 3 3brs and 1 5 br. My building hase 17 kids under 18 in it.  They are always flushing nonsense down the toilet. I am going to add a clause to my leases in the future where i charge for sewer unclogging..

Trevor K. · Answer

@Cal C.  Yes, due diligence is done. I haven't transferred utilities yet, as I like to wait until after closing.

@Justin Mills My exit strategy is very similar to a ship captain's.  Might not be the best, but I am still young enough to recover!

I will be holding long term, and plan to renovate the units as the tenants move out, they are in ok condition, but there is huge room to increase rents.  One tenant has been there 13 years, the other 3 have 11, 9, and 2 months left on their leases, so timing is great.