All Forum Posts by: Connie Chan

@Sheena Lee Don't do it! There is indeed risk. I use a separate account for each rental property, but there's STILL risk for giving tenants your account number. For example, it makes it really hard to evict a tenant if you give them your bank account (at least that is true for the area where my rentals are, it is location specific). The tenant can always send a partial payment and I can't block or refuse to accept it. Now your tenants might be "good" tenants but I don't think it's worth the risk. Also, bank statements aren't great for bookkeeping. It's better to have a separate system. For example, I once was checking my statements and noticed that it seemed off by the amount of the security deposit, but my bank doesn't even show me my checks written or cashed beyond 18 months. I went to the local branch and the manager couldn't get the images either. 

There are other safer ways of collecting rent that still allow for deposits to show up directly into your account. I choose to use an app called Tellus since its free and mobile and my tenants prefer a mobile system where they also get the notifications. It gives me a notification when the rent is paid or late. More importantly, unlike the bank account, I can choose to block payments altogether or block partial payment. From a business perspective, I think it's safer to have these systems in place, just in case.  

@Akeem Moreno , Congratulations and super exciting that you've made this decision to get into rentals!!! 

My recommendation is to read some of the Bigger Pockets books, listen to their podcasts, and also see if there are good online courses on the topic. Mostly because everyone on BP has really good advice but a different risk/reward tolerance as you -- and therefore you'll have to take everyone's opinion and then reframe it to fit your own risk tolerance. For example, if you want to max out rental yield you might pick a place that's "riskier" in terms of home prices, but it's perfect if you're super long termholder and want to optimize for cash flow and financing (and this means it also depends how much debt you put on it). Wheras if you're just testing out the waters, you might want a place (like NY which is what you mentioned) with higher liquidity! 

And even the type of building you purchase chances all based on your needs for liqudity, risk, property appreciation potential, amount of work it takes to manage (is it a new build where things won't break or a home where you'll be fixing stuff each week), etc. So definitely chat with all the amazing friendly and wonderful experts here on BP but also take the time to learn how the whole process works from books/podcasts and online resources. It will pay off for sure. 

You can also get frosted windows. I put that in one of our bathrooms that has a window. It was the same cost as a normal window and I think it looked more "modern" than the glass block look. But that's just a personal taste question. For rentals I go for broad appeal and appeal towards younger crowds. 

The other idea might be one of those frosted adhesives. I don't know if they stand up well in humidity but they're SUPER cheap at HomeDepot, maybe $10 would be sufficient for that window size. Worth looking into though if you're considering replacing the whole window. 

@Jason Malabute , I think this is a good question and also specific to location. As we all know in real estate it's location, location, location! And for rentals, the same holds true. A home in a really good location is less susceptible to market price drops, it doesn't mean the price won't drop it just means it has a higher chance of dropping less or rebounding faster. Now of course, things are fair and those places oftentimes have lower rental yield. 

I'm in the bay area for example, and rental yield here is very very low! But on the flip side I know the appreciation value is good and that even in a market correction the demand for homes in the bay area isn't showing much weakening. It's part of a macro trend I think towards technology. I was studying Palo Alto prices last year and even in the 2008 crisis, it barely dipped and rebounded fast. (rental yield there is so so low)

There's that saying don't wait to buy property, buy property and wait. One of the realtors I know puts it in her signature. I personally half agree with it, there's always something that may be worth investing in, it's just a different risk/return profile at any given time in the real estate cycle. 

I was at a real estate conference not long ago and they had a big thesis that the reason millenial ownership was down was not just cost but actually people getting married earlier!!

They said that one of the major predictors of buying a home was getting married and having kids, and with people in the States doing that later in their life, the renter phase is getting extended. I thought that was a really interesting hypothesis and would suggest that this trend isn't changing anytime soon even with market changes. 

@James Pollock and @Peter Tverdov , I don't have as many units as either of you but I've been using a mobile app called Tellus. It can do most of the things you mentioned and even my mom uses it! Listings, screenings, maintenance, payment stuff. Instead of SMS texting it has chat which is nice because you have your conversations threaded and backed up just in case. It doesn't create a website for your property though like a Buildium does. My tenants like it though and they pay more on time. 

@Account Closed , my mom is in the same situation as you with a 3 bedroom property with 3 roommates that get billed separately for different amounts, too. She and I use a mobile app called Tellus, it's also free and can do the late fees. 

@Joseph Schreiber great advice from everyone so far. Only thing I’d add is think about diversification. Real estate is my favorite investment class but that 5% stake was probably a good investment for you in terms of ROI! (I’m assuming you were an angel investor). So I think it’s about allocating some to stocks some to real estate some to whatever other businesses you want to invest in. And don’t forget bonds and all the other options out there. Also think about liquidity. Real estate doesn’t have the same liquidity as say stocks, but also has lower risk if you choose well. So ask yourself 5 years from now will you want to start a business or do something else that needs that cash quickly. If so, then liquidity matters.

@Jalen Henningsen search Zillow and craigslist comps. But also do it for a period of time. Otherwise you only see a snapshot and rent prices can really be seasonal. So many look several weeks up to determining the price. Also remember these are listing prices not necessarily the prices that actually clear.

@Dan Shelhamer quickbooks is indeed hard to master but good if you have a ton ton tin of rentals. I use a mobile app called Tellus. It lets me take photos of receipts throughout the year and classify it by tax category and also unit. Generates the expense report automatically for me for tax season. Also it’s free. I set my mom as a co-owner for one of the homes and she can upload receipts when she handles stuff for me when I’m out of town. That part is super handy.