All Forum Posts by: Shari Posey

It's such a competitive rental market out there with rents going down and all kinds of freebies offered (free gym membership, free first month rent, low deposits, etc.) that we decided to just buy the new fridge and washer and hope for the best. We will still have the clause in our lease that says they are their for tenant's convenience only but we'll just have to see what happens when something else breaks. I mean, one month empty is more money lost than the new appliances.

We went out of town for 5 months and provided all our tenants with payment slips and they mailed the checks directly to our bank. We only have 4 rentals but they sent them mostly on time every month and we viewed it online on our trip. In fact, they are continuing to do it now that we are back and it's a breeze. Love it!

This is an old thread but I have a new question...our lease says all appliances are at the convenience of the tenants BUT of course, the most recent tenants expected us to repair them. We said no. So now they moved out and we have a broken refrigerator and broken washing machine. I think it's a nice benefit to provide them (and it's a renter's market) but how do we tell them it's their responsibility to replace them or repair them??? They will be brand new and I expect them to be working for at least a few years. (We found a new fridge for $250 and a new washer for $300. We have had mixed results with used appliances.)

Oh, man, forget about LLCs for each of these properties. From my quick half-hour research on the internet, an LLC is treated like a corporation in CA and it can get really expensive with $800 per year per unit to the state plus seperate accounting costs at another $500-plus per year per unit, and then insurance, too.

I think an umbrella is the way to go.

I thought about a few years ago but as I recall it's about $1000 per property just to set it up. Honestly, I don't know that much about it so any CA landlords can advise.

Actually, when I look at our bank account I think I don't have much to lose but you're right, with properties we do have a lot to lose. Good point. I think I'll go for the $1m umbrella--it all ends up being about $1000/yr for all properties.

Right now I have no liability insurance on any properties. All are owned free and clear so I don't have to have insurance but I'm worried that a tenant will slip and fall in the tub and sue me. I have fire on a single fam home (only $200/yr) and just the master HOA insurance policy on 3 condo units.

Is liability coverage of $100,000 per occurance enough? $300,000? Do I need to get a $1m umbrella?

FYI--In order to get any liability insurance, I must ensure one condo for property damage ($350/yr) and then I can add liability on dwellings rented to others for about $25/yr for each unit. Also, it seems stupid that the condo interior costs more than fire on a single fam. dwelling. And they require having my auto policies as well, which is at a higher rate than my current carrier.

Vikram, I think we agree to disagree. I get your points; I just don't agree with them.

Regarding the premise that the internet is rendering real estate agents less important...I just don't see it. In fact, I just closed a deal last week with a couple who I met at one of my open houses. They were using the internet to find open houses and to contact the listing agent on particular houses. They said they were frustrated it was so hard to coordinate a listing agent to show them the property and some don't even return the calls. They were thrilled when I offered to work with them. What I see is that the internet is how a buyer starts to get familiar with an area and the price ranges but I estimate more than 90% end up with an agent who works with them to get a house. On the listing side, the internet has been a great way to drive interest and traffic to a house but unless a seller is going to sit at home all day or leave a combo lockbox on the house for anyone who wants to see it, I can't imagine how you would get enough buyers to view it. Additionally, I think the agent provides a valuable seperation between emotions on both sides of the deal--I'm probably talking about residential homeowners not investors although I've seen some emotional investors, too. As others have said, agents handling paperwork and our E&O insurance are other benefits for both parties.

Actually, there have been ways the internet has actually hurt the process: scams particularly on renters, Zillow inaccurate values, Refin's out dated listings, etc.

This argument about real estate agents' worth is an old one and the internet has been around as a way of life for more than a decade. Entrepreneurs are constantly trying new models (online auctions, ebay, HelpUSell, Buy-Side, etc.) but nothing so far has really caught on. That's not to say something won't in the future (We sent a man to the moon!) but until you have been a real estate agent, I just don't think you have a grasp for the amount of work and stress we go through...remember, we are selling dozens of properties, not just one every couple of years.

One last point: regarding commissions and NAR's "strong hold"... commissions are ALWAYS negotiable. If you interview multiple agents you will get multiple commissions. You should pick the one who is willing to get the job done for the commission you are willing to pay. Some agents will work for 1% and some won't work for less than 7%. Maybe the problem you have run into is nobody is willing to work for you for the price you want to pay. As someone who is often in commission negotiations, trust me--there is no price fixing.

Wow, I've let this post get away from me and I just scanned over all the posts!

A couple of points I'd like to make:

--Vikram: Ocwen bank does provide quite a few listing agent responsibilities via India and it's a total mess! I was the buyer's agent on a deal with Ocwen and it took 3 times longer and 100 times more stress getting that deal done than it should have taken. I've heard the same experience from other agents dealing with Ocwen India.

--The post that said it is "typical" for agents in southern California to negotiate 1.5% listing and buying commissions...well, I haven't seen hardly any of that in my area unless it's a listing for a relative. And here's why...

--Commission for the buyer's agent...I sold a condo conversion a few years ago and the investor didn't want to coop with buyer agents (selling agents). I told him it was a mistake because next door was another conversion offering 3%. I literally heard an agent in our units at an open house pointing out all the negative aspects suggesting they look next door at the nicer units; they all got excited about what was next door. After that my investor offered 2.5% but there's no telling how many potential buyers he lost.

--Regarding the worth of a buyer's agents...my average length of time working with a buyer is between 3-6 months. The market has just slowed down but in the past I've written dozens of offers for a single client. In our market the low-priced/hot properties get multiple offers (sometimes dozens of offers). I have earned every penny!

Like I said before, some sales are easy and some are horrible, so in the end it evens out. (If it were so easy then everyone would be a successful millionaire agent!)

I think you should try it yourself just like doing your own tax return on Turbo Tax; if it's easy then keep doing it yourself but if you think you can make or save more with a professional then go that direction.