Hello I purchased my 1st duplex in September and everything is going great. Another real good opportunity came up to purchase another duplex, but since I am going to be financing I was concerned about renting it out. I was concerned because I was wondering, do tenants really move in the winter months or do they wait till it warms up. I mean it snows in The mid west so I would think its a PIA to move. Im from sunny SO CAL so we really dont have winter. Lol any input would really help. Duplex is in Council Bluffs Iowa.
In Tenant Utopia, where everyone is logical and makes good life choices, people only move In May, June, and July, and everyone pays last month's rent.
In Council Bluffs, Iowa, however, you may have to evict 2 tenants in November in an apartment building you recently bought because they were inviting homeless people to sleep in the warm laundry room and stealing other tenants' clothing...
Before I had experience with this @Edgar Rodriguez I had the same concerns. However, I've had to move people into rentals in January and even during the holidays. It happens.
Life goes on with job changes, households splitting, etc. So, the need for housing is still there.
As in any deal you should factor in vacancy rates and consider that you may at times have 1 or both sides unrented. It depends on the town and neighborhood. I generally use a 10% vacancy rate in projections. My average is lower than that. So, it works out ok.
Is this duplex currently empty? Leased or rented? That can help with the income side as you take over the contracts, and security deposits.
Remember you can also try to take possession toward the beginning of the month. You will get the pro-rated month of rental income and zero mortgage. That's a big help.
@Ron Rohrssen thank you for the reply. This duplex is currently empty. Since im still new to REI, I have these concerns. I was thinking I mean if I have to wait till the warmer months ill be out at least 3 months maybe 4 months of rent. Ouch. Lol
@Owen Dashner 😱 the hard truth huh.. I was thinking if investing in Omaha for that reason. Dont know if thats any better. Ive heard to stay away from the North side of Omaha.
@Owen Dashner #dead 😂
@Jill F. ok so its not totally dead around winter. Lol
You can get applicants any time of year. Just stick to good screening criteria and maybe see if you can get an 18 month lease.
I'm in Cody, Wyoming. It's a small town, it's cold, and there are few job openings outside of the summer tourist season. I'm still renting apartments and houses.
We can't tell you what that specific market is. Try talking to people that actually live there and own/manage rentals.
I was in the same situation last year with a duplex I bought in Omaha. There is still a decent renter pool, but you may have to sacrifice on price the first go around. Also, try to get a 18 month lease so that you don’t have this issue next time.
I've signed leases on January 1. It happens here in western PA in C-class housing. October comes, the furnace doesn't turn on, the tenant calls their LL, the LL has to pay for a big repair, suddenly the magic spreadsheet doesn't work and the incompetent LL of course refuses to admit they're not cut out for C-class. So the LL turns into a total piece of work, blaming the tenant for the increased maintenance the building needs (like it's not a C-class property) and their own lack of reserves, protracted personal fight ensues because the LL absolutely NEEDS to give the tenant a piece of her/his mind, month-to-month lease is mentioned, eviction is threatened, tenant really just wants out but is worried about moving in the winter months, starts asking around quietly, gets on our waiting list.
It may just be my business model, or the demographics of the area, or the local housing issues, but I can always count on incompetent C-class LLs throwing business my way in the 'Burgh year-round.
@Matt Morgan 👍 thanks for the advice. This is my first winter in REI. So will be learning