All Forum Posts by: Bryan Cork

@John Underwood

Some complexes include water, gas, trash, wastewater. Some just include trash.

The utilities included are just one aspect, the real one to me is the difference in HOA dues I'm paying out. For example if complex A has a $200 HOA and no utilities, and complex B has a $300 with a few utilities included I'm looking at how I can make a buy and hold investment make sense in property B by passing some of that incurred cost along to tenants in the way of a "utility fee". If I can offset it by $50 per month that will make a big difference in my numbers. But adding the $50 to the regular rent amount will also make a difference to people skimming through properties to rent online. I assuming people don't dig into the details right away :)

@Alex Deacon

Thanks for the reply, I agree keeping the advertised rent price down helps in the marketplace. I just don’t know how to structure it properly.

Hi all,

I am looking at buying townhomes and condos as buy and hold rentals. Some complexes have a portion of the utilities included in the HOA dues, so that tends to push the amount of the HOA dues way up. So my question is, has anyone had success in charging tenants rent plus a "utilities fee"? I'm afraid that just tacking it onto the rent amount will cause renters to skim over my property as "overpriced" compared to a similar property that doesn't include utilities.

So if you have done this, how do you market it? And how do you structure that in your lease?

Thanks!

@Damon Rucker

If you want people to stay, I would forget the rent raise for now. I would focus on the management side of the business. Specifically, the security deposits. Again if you want them to stay I would collect that slowly over time. Good luck!

Oh and I’m a compassionate guy, but this is business. If rents need to go up you need to do what you’ve got to do. And that might mean people have to leave. Happy landlording!

@Brandon Peaker

Specialized IRA services is a company I recently connected with to get some of their training material.

They were on Joe Fairless’ podcast #1642 that’s called The Best Ever Real Estate Investing Podcast. Check it out!

@Jeff M.

I agree Jeff, as your agent they owe you that obedience, and to act in your best interests at all times. I hope you have the correspondence in writing.

@Michael Chant

Maybe I’m assuming too much, but if you are wholesaling this as a FLIP, then don’t listen to me. But if you are looking to sell to an investor as a buy and hold. The criteria is different. You need to know who is going to buy this and why.

@Michael Chant

I as an investor look at CAP rates for all properties. SFR's, Condos, townhomes, duplexes, and 4 plexes.

Now with that said I know that CAP rate does not equal market value, but I use it to judge the performance of property A vs property B, assuming they are similar in nature. Also it helps me weed through different properties with different levels of expenses. So if you as a wholesaler pitched me this deal, and I saw 2 units together that have better CAP rates than I felt I could get vs buying 2 Condos/townhomes that are similar in style and quality I would be interested. Duplexes are interesting too because some are converted from large SFR's, so comps of size and sqft can come into play on the back end (converting them back to a SFR). Anyway, the bottom line is if you are going to try and assign to an investor it needs to be a great deal for them in terms of ROI/ cash flow.....that is determined by the CAP rate IMO. Good luck!

@Jason SanMartin

I would start by asking the wholesaler if taking his purchase contract with a non cash offer is possible. They might be negotiating with quick close conditions and needing cash buyers. As far as a VA loan, I'm not positive. Might depend on the condition of the property but I would talk to your lender, or put some time in on Google. Good luck!

@John Vu

Forgot to add, 2% rule = Gross rent Multiplier (GRM) it took me a while to figure out they are one in the same 😉