Finding/Screening Quality Tenants for SFH in East Oakland

Oakland, California
Oakland Real Estate Forum
5yFollow

Finding/Screening Quality Tenants for SFH in East Oakland

Willie Mincey
Member since 2019 · 3 posts · 4 votes

Hello BP! I own a home in deep east Oakland, and for the past three years it has been used as my primary resident. I am moving out, but want to convert this home into a rental property. I have heard numerous horror stories about problem tenants, and I want to do my due diligence and limit that risk. Can you please share your experience on finding/screening tenants? What are your thoughts on section 8?

Thank you in advance!

3Reply
42 views

Most Popular Reply

Brian Garlington
Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
5y

Willie,

Wrong. Your first step is to go to the Oakland Housing Authority Website and see what the requirements are as far as the shape the property needs to be in. You will also get an idea as to how much they will pay you.

Then advertise on GoSection8 for free.

Some of the things I do to mitigate a lot of the nonsense.

No smoking AT ALL. I don't care if you have a "green" card. You are not smoking anything in my rental.

No evictions or felonies in the last 7 years. Period.

Have the voucher match the property. You have a 3 bedroom place for rent and the tenant says they have a FOUR bedroom voucher is a recipe for disaster. Ask kow hamny people will live at the unit with them. If you have a 3 bedroom rental and she says "Me and my two sons",....you should be fine., but always ask.

No dangerous breed animals or pets, period.

Do they have any animals or pets? If the answer is no then I actually prefer that to someone who does have them. If they say they have a "dog" your antennas need to go up. Usually someone will say they have a yorkie or a chihuaha or labrador. If they say a "dog" ask what kind. Pit Bulls, Staffordshires, Bulldogs, Bullys, Dobermans, Rottweilers or any dangerous breed is a no-no. If they say they don't know what kind of dog it is because it is a "rescue", then ask for a picture of the dog.  If all is well, make sure to tell them to bring the dog with them when they come see the property. If they show up without the dog (Rocky the dog doesn't like strangers......or whatever excuse) then that is part of the screening process and if you end up finding a "better qualified" tenant then that is their loss.

I actually don't care what their credit score is or income is because I know the housing authority is covering 70-100% of their rent. I also don't care about the employment history either because if they get lose their job or get their hours cut they simply send an email to me and the Housing Authority and the housing authority starts covering 100% of their rent until they get another job. 

I also require them to pay one fill month's deposit before they move in. No exceptions.

If your rental is in Oakland or anywhere in Alameda County then check out a program called Abode Services. They are like Section 8 on Steroids in a good way.

2Reply
See this reply in the discussion

13 Replies

Jump to latestLatest
  • Account Closed
    Member since 2020 · 983 posts · 1k+ votes
    5y

    I think it is illegal to discriminate against Section 8 and you have to consider Section 8 with the exact same magnifying glass as every other tenant.

    As for finding the tenant from hell, always remember that just like a clown going to an interview for a job, applicants always put their best 'Game Face' on when you are interviewing them. Applicants have experience looking for rental units and they know exactly what papers they need to fabricate.

    We've owned several fairly large apartment buildings for several years and contrary to what every pro does we never ran a credit check. We think we do very well by asking to see only the first 2 pages of their bank account statements for the past 3 months and we want to see exactly what account their rent was paid from for the past 3 months and whether or not their rent was paid on-time for the past 3 months. We feel that the information we require is better than looking at a credit report that covers a wider range of dates and a wider range of things that don't pertain to whether or not the tenant paid their rent for the past 3 months.

    When a tenant hands us rent receipts from a $2 Office Depot receipt book and tells us they pay cash we kick the applicant out the door. We don't want tenants who pay with cash and most-likely they are not telling the truth.

    Inspect your rental unit to see how much damage your tenant is doing no later than 90 days after the tenant moves in and then give the tenant 7 days to repair any damage and evict the tenant for not repairing any damage even if you have a 1-year lease.

    Personally, I hate single family rental units with a passion and expect to pay a very minimum of $6,000 to clean a house and put it back together every time a tenant moves. My average cost is $6,000 to $8,000 and I had one house in Idaho where the bill was $32,000 and the tenant lived in the house only 3 years. Small apartments are much less expensive to maintain. I would consider selling the house and buying 1 4-plex where you can earn almost exponential profits when you increase the rents and the rent increases increase the value of the property. The cost to clean an apartment is usually less than $2500.

    0Reply
  • Jennifer Donley
    Rental Property Investor · Saint Louis, MO · Member since 2018 · 228 posts · 279 votes
    5y

    Hi Willie - for screening, I do all the things everyone tells you to do - call prior landlords, check credit, background check, verify pay stubs and employment, etc.   If you look here on BP, there is a lot of info on how to screen tenants.

    I also include as my final step in the approval process a home visit at their current residence to verify that they've taken "reasonable and normal care" of it.  This tells me far more than almost anything else I do.

    It's interesting how much @Account Closed hates SFH - I love them and when you pick a great tenant, it doesn't have to cost an arm and a leg to turn a unit. I just turned one for under $2,000. But that's the beauty of RE investing - there are lots of ways to be successful! Good luck.

    1Reply
  • Paul Merriwether
    Investor · Oakland, CA · Member since 2015 · 135 posts · 82 votes
    5y

    I loved my Sec 8 tenants!!! For 30+ yr's I owned the property at 2621 78th ave in the killing zone. My worst tenants were the ones not on Sec 8. Take for example Covid rent ... Sec 8 you got paid!!! Maybe the tenants portion was late ... not a big deal because it's generally minor $$$. They'll take care of your property because they don't want to get kicked out. I was shocked when my last tenant moved out it was two days after the 1st. Sec 8 paid for the entire mth. 

    One last thing ... NEVER SELL Oakland properties!!!! I learned my lesson the hard way. :) 

    1Reply
  • Paul Merriwether
    Investor · Oakland, CA · Member since 2015 · 135 posts · 82 votes
    5y

    @Account Closed >>

    Personally, I hate single family rental units with a passion<< 

    You must not be familiar with SFR in the Bay Area. They far out perform any MFU. I never hard positive cash flow

    from my rentals however with write-off's & appreciation I made more than $1 million. Love Bay Area SFR property!!! :)

    0Reply
  • Brian Garlington
    Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    5y

    Willie, I can't emphasize enough what Paul said. I have Section 8 tenants in deep east Oakland right around the area he is talking about and those Section 8 tenants are a gold mine when they are properly screened. If you are wondering who to take and how to screen them I can lay out to you what's worked great for me in that area, as well as Contra Cost County and in Cleveland my man. And do not sell your Oakland property. Maybe do a cash out refi and spend the money on more assets.

    1Reply
  • Paul Merriwether
    Investor · Oakland, CA · Member since 2015 · 135 posts · 82 votes
    5y

    @Brian Garlington  SO you purchased in Cleveland. Are you you renting to Sec 8 people? What kind of cashflow & appreciation does that area lend itself too? 

    0Reply
  • Willie Mincey
    OP
    Member since 2019 · 3 posts · 4 votes
    5y

    @Jennifer Donley thank you for your time and insight. I did find the tools on screening tenants.

    @Paul Merriwether @Brian Garlington Thank you both. I definitely want to keep my SFH. Its located right of 76th near the current Coliseum. I have not tried section 8, but I am definitely interested. Any advice you have would be amazing. I did some research, and it appears one of the preliminary steps is getting the home approved and inspected.

    0Reply
  • Brian Garlington
    Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    5y

    Paul..............yes I have been purchasing in Cleveland for years. Started having my PM rent out to Section 8 tenants out there as well. Too much nonsense from cash tenants and this was BEFORE the pandemic.

    A (now previous) property management company (who shall remain nameless) started getting creative in figuring out ways to NOT rent out to Section 8 tenants, even when I made it 100% clear that it what I wanted. I was shocked at some of the nonsense and excuses they were using to (supposedly) legally not rent to Section 8. The last straw as when a Section 8 Applicant who passed their background check came to the property management office with their full deposit and RFTA paperwork after seeing the property and the PM told them that someone else had already come in with their deposti before them and had signed the lease. Turns out they were "mistaken" and they apologized profusely.

    I have since fired them from managing that duplex. 

    1Reply
  • Brian Garlington
    Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    5y

    Willie,

    Wrong. Your first step is to go to the Oakland Housing Authority Website and see what the requirements are as far as the shape the property needs to be in. You will also get an idea as to how much they will pay you.

    Then advertise on GoSection8 for free.

    Some of the things I do to mitigate a lot of the nonsense.

    No smoking AT ALL. I don't care if you have a "green" card. You are not smoking anything in my rental.

    No evictions or felonies in the last 7 years. Period.

    Have the voucher match the property. You have a 3 bedroom place for rent and the tenant says they have a FOUR bedroom voucher is a recipe for disaster. Ask kow hamny people will live at the unit with them. If you have a 3 bedroom rental and she says "Me and my two sons",....you should be fine., but always ask.

    No dangerous breed animals or pets, period.

    Do they have any animals or pets? If the answer is no then I actually prefer that to someone who does have them. If they say they have a "dog" your antennas need to go up. Usually someone will say they have a yorkie or a chihuaha or labrador. If they say a "dog" ask what kind. Pit Bulls, Staffordshires, Bulldogs, Bullys, Dobermans, Rottweilers or any dangerous breed is a no-no. If they say they don't know what kind of dog it is because it is a "rescue", then ask for a picture of the dog.  If all is well, make sure to tell them to bring the dog with them when they come see the property. If they show up without the dog (Rocky the dog doesn't like strangers......or whatever excuse) then that is part of the screening process and if you end up finding a "better qualified" tenant then that is their loss.

    I actually don't care what their credit score is or income is because I know the housing authority is covering 70-100% of their rent. I also don't care about the employment history either because if they get lose their job or get their hours cut they simply send an email to me and the Housing Authority and the housing authority starts covering 100% of their rent until they get another job. 

    I also require them to pay one fill month's deposit before they move in. No exceptions.

    If your rental is in Oakland or anywhere in Alameda County then check out a program called Abode Services. They are like Section 8 on Steroids in a good way.

    2Reply
  • Willie Mincey
    OP
    Member since 2019 · 3 posts · 4 votes
    5y

    @Brian Garlington

    All those tips are really helpful, I will definitely use the recommendations in my applicant screening. My SFH is located in Oakland(Coliseum), so I will also check out Adobe Services. Thank you!

    1Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    5y

    You might want to read our series about “How to Screen Applicants like a Pro”:

    https://www.biggerpockets.com/member-blogs/3094/93296-how-to-screen-applicants-like-a-pro-part-1-verifying-credit-reports

    [email protected]248-209-6824
    Logical Property Management4.9458 Reviews
    WebsiteView Page
    0Reply
  • Leena K.
    Investor · Member since 2021 · 4 posts · 3 votes
    5y

    Very helpful post as we are in the process of buying a multi family unit in Oakland. Curious - why the ‘never sell Oakland property’? Because it will continue to appreciate for years to come?


    Thank you!

    1Reply
  • Brian Garlington
    Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
    4y

    No probel Willie,....I hope it worked out for you.

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free