All Forum Posts by: Doug McVinua

Congratulations on the purchase of your 2nd property!

Some of the Facebook groups have been productive the last couple of years. Find an active group for the area of the valley the property is in and run an ad for free.

@Raymond Locker Michael Sheridan  Four Eight O 668-7600 is great with family law, estates etc and should be able to put this together easily for you.

@Paul W.

We typically charge one month's rent plus a $300 cleaning deposit, both are refundable. If a pet is approved we will add another $300 that is non refundable. Deposits cannot exceed 1 1/2 times rent in Arizona.

Application fee is $45 per adult for credit, criminal and eviction history. We also request a number of other documents to collaborate the information.

Earnest Deposit is typically $750 for a property like this, earnest money normally converts to security deposit at move in. Earnest Deposit is non-refundable.

Be sure to use documents that are inline with the Arizona Landlord Tenant laws.

Let me know if you have any other questions, glad to help!

Welcome to BP @Steven Oneill!

It's a great site to learn and share!

Welcome to the site @Andrew Strachan! 

Lost of sharing and great information on the site. I look forward to learning and sharing with you.

@Daniel J.

Where is the land in Arizona? 

The metro markets, Phoenix and Tucson continue to do well. Both markets have been stable for the last 6 years and builders have purchased most of the improved lots that exist. 

Raw land is hit and miss, location, location, location, location!!

@Clary Roberts

Once upon a time (2008-2010) era a few lenders sold off some large packages of assets,  typically millions and up for pools of properties in AZ. Many of those were purchased by institutional type investors and some are still held in large rental pools

@Bill Gulley Agree, we just don't see most lenders seling individual properties. Some of it is regulatory as mentioned and some of it that they just aren't capable of dealing with individuals on each property so they don't. Lenders are so process driven, part legal and part model it just doesn't work for them.

Some of the very small local lenders/banks/credit unions might be suited better to sell 1 asset off than the big national players.

It feels like looking for a needle in a haystack sometimes!!

Having completed a few, Hard money was used for the initial acquisition of the property and the rehab costs. Using your example we would have $105,000 owed to a hard money lender on this property that is now in good condition and rented out. You can now get a conventional loan with a good interest rate, lower your payment to improve cash flow and have a permanent loan.

We were able to refinance into the conventional loan on a couple of properties with equity such that the owner had almost zero cash tied up in the now positive cash flowing property.

He now owns a positive cash flowing property in good condition with almost no cash tied up in the property. Very nice when it works!!

In Arizona most Property Managers have an account that is designated and labeled "Trust Account". The Trust Account is for holding money that you have care of but it's not yours. Some have more than one and some have one. I happen to have one Trust Account that is carefully reconciled every month and balanced so we know exactly how much money we are holding and for whom. Some have two so that deposits are in one and rents in the other one. The Department of Real Estate doesn't really care whether you have one or many as long as everything is reconciled monthly.

Trust Account is only a label on the account and is not at all like other Trusts. The Department is very careful with the label and with Property Management as millions of dollars have gone missing in the last few years from Trust Accounts.

We provide a professional statement every month to our owners with details of everything that happened. We also provide copies of any repairs etc so the owner knows exactly what is happening.

@Zane Belden

The 4-Plex's have been mostly in Mesa and Phoenix. I see a few Tempe but it seems harder to make the numbers work in Tempe. Chandler has a few, Gilbert hardly any multifamily like 4-plex.

Condo HOA's are an issue many times, the acquisition cost can be attractive but once you bring the monthly dues into play the numbers change fast. Some work, lots dont just for that reason.

Seasonal has been interesting and you hit on the challenge: vacancy. The first quarter is always full but the rest of the year is more challenging. I have actually moved completely over to long term rentals. I have one furnished that does well with corporate clients even when restricted to longer terms. Just had a corporate tenant for two years in one furnished property.