All Forum Posts by: Aaron Xie

Even 1.5% is too optimistic. 1% is a more realistic rent/price ratio now. 

@Clay Manship What are the areas you have invested in? Your 17-21% Cap rate is really high to my standard. My property is located in Greenwood (Center Grove School district). In this area, now I can barely find properties with monthly rent/price>1.5% that can be rented for $1000+ per month (the A-properties?). 

Thanks, @Greg S.. 

Just an update. I have asked my PM to reject the application. 

@Mike D'Arrigo No, I do not factor in mortgage payment down or any appreciation. 

I just heard back from my property manager. Here is her reply. 

Is it true that I, as the landlord, don't have access to the credit and background reports? That is weird to me. Could anyone from Indiana kindly confirm this for me? I have had a great relationship with this company, but this just surprised me. 

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Unfortunately, we are unable to forward the credit and background reports due to privacy laws; however, I can provide you with some information regarding the applicants.

There are two applicants. One is employed and has been on their job for a year and a half with a gross monthly income of $12,000 and was with their previous employer for four years with a gross monthly income of $10,000. We have confirmed the applicant’s income via their employer and tax forms.

They currently own their home; however, they love your property and are willing to lease the home for a few years in order to potentially purchase the home when/if available. They plan to sell their current residence.

The reason they would like to pay for the first year up front and make the repairs to the home is to show they are truly interested in purchasing the home and want first right of refusal when you are ready to sell. We would require the work to be completed by a professional vendor and require them to provide receipts of payment to the vendor. 

Thanks, Dawn Brenengen! Now I intend to reject the tenant as well, but still would like to see the application and credit report from my management. 

@Ryan Billingsley You have great deals! I did not factor in any finance/leverage, because I know that varies a lot across investors. BRRR is the strategy I have beening following as well. Without any finance/leverage, what would your ROI be?

I am interested in learning the ROI (return of investment, i.e., net annual income/total purchase price) of other investors on their rental properties, to see if there is a big variation across cities/states. My ROI in the last two years for my SFH rental is 6.11% and 7.91%, respectively. The property is in Indianapolis.

My property management has approved the application, but is asking me whether they have my approval for these additional requests. I will call to find out what they mean by "have approved the application". Hope they have not promised anything to the tenant. 

Just want to bump this post up to see if anyone has a recommendation.