All Forum Posts by: Corina Eufinger

Ulises,

I am always skeptical of networking organizations that want large cash up front.  

I prefer buy and hold rentals. I have 12 rental units right now and its the only aspect of real estate I do. I like rentals because its a a constant flow of cash (in theory).  It doesn't hinge on me creating new leads and new deals. I only need new deals to expand what I have. 

I use Teledirect for over a year now.  Minutes are 1.10 each. I haven't had any issues with them.  I use them for my rental properties for after hours emergencies. I don't know if they can do order taking.  

In most states, you would have to told him you were not renewing his lease before May 1st.  Just because he didn't renew (again in most states) doesn't me he is going.  Presumably as well his choice "not to renew" may also not serve as proper notice since he didn't inform before the new rental began.  But without knowing your state laws I can't really say...

Either way, you can always refund what he may be entitled to for rent above and beyond what is required.  You will have to refund I believe the pre-paid rent not used (whether that could be used for damages beyond sec dep...that's another state law question). 

Once you get over the leasing hurdle it is feasible to manage it on your own for SFR. It is one of the easiest investments to manage because the tenants tend to be self-sufficient. They do their own lawn, pay all the bills outside of taxes, handle the snow. It more requires an owner to occasionally check up on the property (drive bys and annual inspections) and be available for repairs in a timely fashion and have the network to respond to emergencies if you cant. If you don't want to do repairs after work at all, and take frequent vacations without a network of connections for repairs, you are better of getting a manager. If the leasing part of it worries you (being available, etc) there are some companies that will handle leasing for a finder's fee (usually one month's rent in that instance). Whether a manager makes really depends on how hands on you want to be. My only worry with a full-time job is your availability to show the unit. If you are only showing it on Saturdays, it may take longer rent it. Its not a hard and fast rule but usually the less available a property is for showings, the harder it is to rent it.

My fee for SFR is 10%. If someone only wants us to handle leasing and then get out of the picture, its 60% of the 1st month's rent plus any special adverts requested by owner (once that require paying like a newspaper listing, etc).

Trischa,

I do recommend addressing the looming departure in your introductory letter.  If not only to cover your bases to be also as a measure of characteristic for your business dealings. Not that you owe them an explanation but rather as a display of upfront and ethical business practice.  If you don't mention the requirement to move-out it can seem shady or sloppy to the tenant receiving the letter. Here's a few strategies you could use 

1. "We are sorry to inconvenience you with the requirement to move that was put fort prior to the sale.  We hope you have found a new home that sparks a little joy over an otherwise stressful time."

2. "We appreciate your cooperation in vacating the unit in a timely matter on August 31.  We hope the length of notice given was able to ease the process for you. If you have any questions on our expectations for the move-out process please do not hesitate to call. "

3. "We hope your search for a new home for September 1 has been smooth.  It is unfortunate that we are not able to under go the repairs while you are residing in the unit.  Our wish to complete a large rehab of the unit makes that impossible and wouldn't be a nice living situation for you [your family].  If you have any questions on the move-out process [or need suggestions of where to look for a place], please give us a call. 

If you are doing an additional notice to vacate, Wisconsin Legal Blank is the best place to find pre-made forms.  But in honesty a notice to vacate doesn't have too many legal requirements in Wisconsin and can easily be made by yourself.  Make the date of the notice is more than 30 days prior to end of lease (the date of letter matches postmark if you are mailing); make sure it has the specific address you are looking to be surrendered; the name of the tenant on the lease, the salutation of "Jane Smith and all other tenants"; the body of the letter should state the date the lease expires, the phrase "and all other premises associated with lease [this covers garages, storage units, parking spaces, etc).; then state that the notice is in compliance with Wisconsin State Statutes. In its entirety my own created 30 day notice is 3 sentences in the body.  That's it. I always mail mine, and I always use certified mail (not the signature requirement, but the one that gives a tracking number.)

Hope that helps!

No, I wouldn't recommend it. An owner of mine has a home warranty on her SFR rental. I forgot what the exact item is she wanted to use it for, but the contractors assigned to the home warranty were scheduling 3 weeks out. I don't know any tenant that would wait 3 weeks just for the problem to be investigated.

@Craig Curelop I would agree there about the napkins.  Its like charging for paper at law office or PM company. 

That's a very good clip to illustrate your point.  A lot of people end of being a Squidward (or at least inside while outside trying to act like Spongebob). Conversely I always enjoyed Mr. Krabbs though the portrayal is a facetious view of business owners and better off people, it was something that struck me as the more right path in life.  Mr. Krabbs himself wasn't a depressed or unhappy person (Spongebob antics aside), he was a happy guy because he had his stuff figured out.  

I was working for a property management company in my teens when they bought out another one.  Tenants were already accustomed to working with a PM rather than being managed by the LL previously.  It is the best way to expand your own management portfolio by far.  You have to be aware that LL's will be leary of you and possibly very slighted by the PM who got bought out. It is in your best interest call each LL and make an appointment (if possible) to meet in person. We went to a lot of face to face meetings in their homes and local restaurants.  We sent out a letter that said "we are purchasing your property management company effective _____.  We would love to have opportunity to have a member of our staff sit down in person with you to discuss the transition and our company.  Please give us a call to schedule this. Don't worry, if you get too busy we will be sure to reach out to you before the buyout goes into effect."

As far as value of the business.  For the business value there is no set formula. A good place to start is to value it based on the the last 3 years income plus the value of any assets you acquire in the deal (trucks, large equipment and tools, office that is owned, etc).  If the company brings in $145,000 per year in management and maintenance income (gross income not net) the value of the business is worth $426K plus the assets purchased. Chances are they will talk you up for the value of income, which is fine.  They might say its $475,00k. 

Hope that helps. 

My first year I did one deal that constituted 12 rental units (2 fourplexes, and 2 duplexes).  I have not acquired any additional properties since then.  But in my 3rd year now I have my eyes on another portfolio (33 units) but need more down payment for seller financing.  I only do rentals and have a slim category of what I will purchase.