All Forum Posts by: Account Closed

I do a 5% increase at every lease renewal to cover the rising costs of insurance and property taxes.

We have two notes both at 12% in Seminole, Texas. 

Tend to look for like quick maturation loans, like under 5-years.

The payments are sometimes late, but we charge $50.00 late fees, and they add up.

Although, more difficult to do now, when I started over 10 years ago, it would be for me, balance of cash flow and appreciation, low property taxes, and low interest rates, with 25% down 30-year conventional loan. 

Avoid buying cheap old houses, as they will cost you more in the long run in repairs, insurance, and maintenance. 

Research the neighborhoods where the properties are located, (check average income of the area) as you don't want areas that attract high turnover, that will cost you big in rehab every time a tenant moves out.

Avoid non friendly landlord cities, this would also include cities that nickel and dime you in landlord taxes, occupancy tax, and permits (always finding issues with your property to charge you a violation)

If out of state, it's impressive to find a good competent property manager who communicates to you.

New, flooring, counter tops, cabinets, appliances, light fixtures, etc. can add value to a property.

We used to use All-State on our longterm rentals in Alabama, as they had some nice Landlord Policies if you had multiple properties with nice discounts if you pay in full and bundled. 

But since we sold off most of our portfolio, we lost those discounts and the prices they quoted for our new STR were over $4K.

We found a company called, Proper Insurance Services and got a $2,148.64 policy premium for the STR in Georgia.

For the LTR in Alabama we use Real Protect and got $857.54 for that premium.

As an out of state landlord and one who has a property in Atlanta, find a reputable property manager. 

I pay a little extra in the percentage on our STR (30%) but it is worth it, as the PM does everything in keeping the clients happy, property maintained, cleaned, landscaping, security, keeping the property occupied, and their knowledge of the local rental market, and what to charge.

Wow, you got a 3.875% interest rate, that's great!

We do about $56K in gross revenue. 

The property is a 2-story brick, 2,110 sq. ft. 4 bed, 2.5 bath, 2 car garage.

Bought the property in 2018 for $150,990 (basically the lot first, then waited a few months while they built the house) 

Got a conventional loan with 25% down, 4.875% interest rate 30-year, later refinanced that to a lower rate of 3.75%

Rented the property out for 3 years as a LTR to the same couple, then thought it could do better in monthly income, reinvested $100K for a rehab into the property to start a STR.

In the 5-years we have had it, with the exception of the rehab, it has never been vacant for more than a month. 

The first couple who rented it out for the first 3 years didn't want to leave, and even offered to buy it.

Yes, but that is quickly shrinking with the rising cost of property taxes, insurance, security, cable, wifi, lawn service, PM fees, cleaning linens, book keeping, pest control, furniture and appliance maintenance, power and water, etc.

Also, we bought the property new in 2018, rented it for a couple of years as a LTR and then when we went STR, we had to put over a $100K into it to upgrade it to luxury status to charge for the higher rents.

The property has a great location right in the perimeter, and near to the Atlanta Airport, so that is what it had going for it. 

We have one in Atlanta, GA. and we have been going for almost 2 years. 

What has been learned is that a STR has vastly higher expenses, especially in home insurance, and more moving parts than a LTR.

This tenant knows how to play the game. This is so Pacific Heights.