All Forum Posts by: Adriaan Sierra
Adriaan Sierra has started 5 posts and replied 57 times.
Post: can't find a tenant
- Investor
- Cleveland
- Posts 58
- Votes 41
Quote from @Audrey Peltier:
Quote from @Gary L Wallman:
Quote from @Audrey Peltier:
Hi all!
This is my first time posting something here. I'm kind a newbie. I bought my first and only rental 2 years ago in Cleveland (I live in CA). The former PM found a tenant quickly. They left in December (without paying the last month). I had to spend a lot of money to renovate the house and the garage was totally destroyed.
The new PM can't find a new tenant (32 days on the market and 216 view but no application) and right now I am hemorrhaging money.
It is a single family home - 3 bd/1ba - 993 sqft - with backyard. $915/month
Do you have any advice?
Decent house with the exception of the horrible look of patched-in siding on the rear of the house, pictured no less. Garage is also a mess. I would re-side the back of the home and clean up the garage.
Pricing seems fine compared to others in the area but the listing is very poorly done. I'm always amazed at how many property owners and managers have no idea on how to write an add. It's supposed to help you sell your property to perspective renters, not scare them away. Why would any property manager list every utility the tenant has to pay separately? Just say utilities not included. What's with the $129 fee and $30 monthly tenant benefit package? You're trying to rent a C class home, not a room at the Plaza. Get rid of all the legalese and junk fees and you'll be fine.
IMHO,
Gary
The garage is being renovated entirely.
I tried to make the PM change the ads but they won't move.
Look at their answer:
All of our rental listings are listed in the same format, to make prospective tenants truly aware of all costs, processess, etc that go into securing a home. We have never had an issue or complaint with the set-up of our marketing ads. I apologize for the inconvenience, but I'm unable to adjust the listing. We have also found that most tenants appreciate the full transparency, so they can fully get a breakdown of costs before viewing a unit/signing a lease.
I think this tells you all you need to know. This is the most non-answer to a genuine concern. They never had an issue, yet the house remains open for 30 days...
Make sure you thread carefully here. Pissing the PM off is not going to be productive, in their mind you are probably one of many annoying customers that only happens to have a single house with them. You need to understand how they are thinking about the problem (if they see any) and if that is aligned with what you want. You also need to understand if your concerns are reasonable (again educate yourself)
You are in a bind, so you need to come up with a plan on how to move forward.
Wishing you all the best
Post: can't find a tenant
- Investor
- Cleveland
- Posts 58
- Votes 41
Quote from @Audrey Peltier:
Thank you for all your responses.
I have not been really happy with the PM, even if I pay 10%.
Here the link. I'm ready for your honest thoughts.
First of all, this area is not for freshman, out of state investors. There are two empty lots right in front of your property and a few vacants on the block. You need a S8 play here to make things work.
What this implies is that you need to focus on your team. Given that you had a PM at first which you now you don't, that the garage was destroyed, and that the current PM is struggling to rent it, I will again double down on the idea that the PM is mostly the problem. Namely, YOUR PM selection has been deficient.
You need to focus on that. You need someone with proven experience in that area who has a solid plan. I'm sure you will get plenty of offers here, make sure you explore those options and other and to also ask the right questions (educate yourself on what those are).
Wishing you the best of luck.
Post: Are people finding it harder to find deals these days?
- Investor
- Cleveland
- Posts 58
- Votes 41
Just wondering how y'all still managing to find good deals out there. I've had a strong focus on West Cleveland, with an appreciation component on my play (e.g. Lakewood) and the last quarter we only close on one property. This is the lowest number we had since we started.
All of the available inventory is way outside our buy box, and I recently saw a MF sold for twice what our highest bid would have been. Most of the deals that are currently available for MF on the regions where I buy would have you at negative cashflow. Last year, we were aiming for a 10% cash on cash at a minimum.
All to say, who are the crazy people that are buying at these prices / rates !? I cannot understand most of the current buys unless you plan to house hack or something like that.
Just curious if you are seeing the same pattern.
Post: Physician Investor looking to work with experienced BRRRRs
- Investor
- Cleveland
- Posts 58
- Votes 41
Feel free to shoot me a line if you have any specific questions (someone who doesn't do this for a living as well). I, unlike most people here, am not trying to sell you anything :)
Post: can't find a tenant
- Investor
- Cleveland
- Posts 58
- Votes 41
the problem is obvious here. You need to either find a new PM or connect with current to find out why they are not doing their job.
Presumably you hire a PM to be an expert in the area. Otherwise what's the point...
It's reasonable to assume you wouldn't know what to charge for rent in Ohio (within a range), that's why you have boots on the ground. Properties sitting long without renting will kill any return you may have. Even with a larger portfolio the worst vacancy I have experienced is lower than what you are saying. The destroyed garage is also a red flag. Seems like your tenant screening was not ideal either...
Maybe post the listing so we can get more granular here
Post: opinion about this offer
- Investor
- Cleveland
- Posts 58
- Votes 41
LOL. maybe don't play in the NBA before ever jumping in the court.
Post: Best Landlord Bookeeping App available for Realtors?
- Investor
- Cleveland
- Posts 58
- Votes 41
Not a realtor, but Stessa as far as I know does all of the tasks above except the last (that I am aware, since I am not a realtor :) ). I enjoyed using it.
We recently switched to quickbooks for better accounting, but I feel I had a better grasp of things with Stessa
Post: can't find a tenant
- Investor
- Cleveland
- Posts 58
- Votes 41
the problem is obvious here. You need to either find a new PM or connect with current to find out why they are not doing their job.
Presumably you hire a PM to be an expert in the area. Otherwise what's the point...
It's reasonable to assume you wouldn't know what to charge for rent in Ohio (within a range), that's why you have boots on the ground. Properties sitting long without renting will kill any return you may have. Even with a larger portfolio the worst vacancy I have experienced is lower than what you are saying. The destroyed garage is also a red flag. Seems like your tenant screening was not ideal either...
Post: Cancelling Property Management Contract
- Investor
- Cleveland
- Posts 58
- Votes 41
This sounds terrible and I am sorry this is happening to you.
Hopefully this helps you find out what went wrong with the first PM and give you ways to self correct
Post: Properties to stay away from
- Investor
- Cleveland
- Posts 58
- Votes 41
Quote from @Bob S.:
Quote from @Adriaan Sierra:
In my opinion, the thing that you have to be the most wary in Cleveland is location. I'm sure James Wise will promote his guide here soon enough. That's a start.
The city has had 15-20 years worth of population decline so there are many areas with essentially worthless properties. These are the kind of properties that would look amazing on paper ($60K with tenants making it a 30% cap rate) but could be terrible investments.
Well not so fast. 10 years ago, I was told I was crazy to set up shop there, well how wrong where they. Also, we are buying in parts of East Cleveland as we know what is coming. 8 years ago we got an 81 unit, off Terrance, we were told we were nuts, well now turning down more than 3 x what was paid. We are trying to buy everything we can just east of Little Italy off Euclid Ave, just nothing out there. Well, I am negotiating a 7 unit, good numbers, will see . An old buddy has a 3 br off Euclid ave rents each bed for $500 6 beds to Case students, shes all in 35k, do the numbers about 50% NET :) Pricing in Cleveland and the burbs have doubled tripled or more of the last 10 years, heck EAST Clev MF are now selling for 40 50k per unit, vs 5k . Just last week closed on a 4 br on 6th off Hayden, it will rent for 1200 at least. We like that pocket behind the RTA. Its all about knowledge and your team
All the best
As you say, it's all about YOUR knowledge. I wouldn't dare going to the blight neighborhoods of Cleveland because I am out of state and I have a clear strategy based on appreciation. Investors need to be very careful there. If you do not understand what you are getting into you are going to get duped.