Alaska Multi family owners - how has on time payment been?

18 Replies

Hey Alaska rental owners, I'm just curious how you are doing with on time rent payments? Are people paying on time? Late? How are vacancies doing? Any modifications to leases?

I dumped my rental in ER middle of last year, it was a dog. I've been seeing quite a few multi family listings, was just wondering if the sentiment is to get out? The rest of my units are in CO and doing well. Everyone has paid rent. I adjusted one tenants due date because of how is work pays out. Another wanted to leave but in the end stayed when they realized my unit was still a good deal. 

I'm still interested in Alaska, but it seems that any good economic news is lacking. Especially with Peddle pretty much dead.

@Keenan Fitzpatrick thats awesome, glad to hear you are getting it all on time. Seems like its just tough right now. Not a lot of positives. Good idea on the unemployment and job listings. Not a lot of people try to help out like that. Good on you.

@Michael Rogers also great news you're getting paid. Your point about Pebble is right for sure, I meant more so for the future. Especially with the way that Oil and Gas has been cutting back. Sounds like more cuts are coming on the slope with BP leaving. Just doesn't seem to be much to be optimistic about when it comes to the economy. 

Just out of curiosity how long have you guys owned your rentals in AK? A buddy of mine has a few houses on the Peninsula and its been tough for him through the ups and downs. He also had a few long vacancies of several months. Even being below market on rent. Have you guys weathered the other down turns ok?

@Tom S. I've had mine for 2 years. I close on another duplex today. I've been a licensee for about 6 years now. I had a condo rental for a couple years before that. My experience has been that almost everything falls back on the tenants you out in your building. I don't own buildings in southside and Westchester Lagoon. I have 2 in Fairview, 1 on Bragaw (lower Mt. View), and 2 in midtown off Tudor and Old Seward. Some of my buildings are fully remodeled and some are average. The fully remodeled buildings attract better tenants, who stay longer, cashflow at a higher rate, and are less maintenance. This is an experience that people will want to and be able to scale. Most of what's for sale in Anchorage is turnkey one the moment it sells but needs lots of maintenance and CapEx.

What do you think? This is the “hack” I’ve developed.

@Keenan Fitzpatrick congrats on the duplex. That's great news. I agree with you about the remodeled nicer units. Everything I own, I have put money back in to upgrade or have plans too. I bought a 4 plex in a class c area and fully remodeled it. Vacancies never last long and I usually have pick of great tenants. Its an advantage having nice things for sure. Also, just fixing things when they break or replacing them also helps too. I've seen a lot of property owners I know that cheap out on everything, and let repairs sit that need to be address. In the long run, that costs time and money. Fix it right, as soon as you can is how I run my properties. My costs are lower for maintenance than others, and we've compared numbers. Keeps tenants happy, and makes for good referrals when they move out. Win Win. So I like your strategy, or "hack" as you call it.

We have 48 units throughout the Kenai & Soldotna areas. All are rented and all are paying on time, minus the one or two who regularly pay a few days late. My real concern is what might happen this winter. With the possibility of unemployment benefits going back down and a federal push to mandate no evictions again, landlords may be stuck with nonpaying tenants for an extended period of time. I hope this will not happen, but I am preparing.

I did see that Alaska will be getting the extra $300 within two months. The biggest thing is that eviction moratorium.We have a little relief down here in CO, but it doesn't look like there is any help for you guys in AK unless you have an emergency fund. That is one of my hesitations for buying anything. Although I really like some of the properties in Anchorage.

My wife and I have a triplex and duplex. We had one tenant not work for two weeks so she got a modified rent for a bit. She was mostly paid up when the early PFD came and she used that to get caught up. 

I am brand new to the idea of investing in Ak. That being said I know that oil is a huge piece of AK economy. Do you guys worry about the future of green energy? Countries are making laws to do away with the new production of gasoline cars by 2030-2035 and more countries seem to be on board. Obviously we need oil for many different things and it will be a while until electric cars are the norm but is this something that worries you? Would love to hear your thoughts! 

@Trevor Halt Personally, I am not concerned about it. Alaska is such a vital resource to the rest of the country and the use of oil goes for far beyond just cars that there will be a demand for its resources and the labor force. And even if there is, Alaskans are about as tough a breed as it gets, so there will no doubt be an opportunity for the state economics to pivot to adapt to new demands should there be a need to. After all it isn't just oil that makes this state great, its mining, tourism, military, collegiate studies, fish and wildlife, etc. Its the people who have learned to find balance in a tough environment to make both flourish. Its the community!

@Trevor...I really don't worry too much about it. In the greater scheme of things, gasoline represents a fraction of oil production and other uses for petroleum production aren't easily replaced. I do think the Alaska economy is too singular and needs diversification. That's been slowly happening, but not fast enough to suit my taste. Oil and gas production will play a big role here for a long time to come.

@Trevor Halt

Jeremy and Michael had great points and summed it up well. I agree 100% with them. Our economy would definitely benefit from more diversification. Maybe in the future with more people working remotely we will see more people drawn to AK for its low taxes and gorgeous scenery. Or maybe they’ll go to Texas where it’s warmer, cheaper to live, and has more jobs. We’ll see.