All Forum Posts by: Eric Gerakos

I’ve had the same tenant in my single family home for 12 years and have never raised rent. They are great tenants that pay on time, never really complain, and generally take good care of the property. Since their fist signing they rent for $1595 but now market rent puts the house around $2100 (possibly more).

What are the thoughts on increasing rent? The lease renews this August.

Another data point is, I’m breaking even each month as is but building equity.

While I think it’s admirable that you have been running a charity, if you want to be a real estate “investor” you will need to make some changes. Not raising rents due to fear of losing tenants is a common mistake. If you buy properties in areas where people actually want to live then there will always be demand for your rentals and people will be happy to pay market rent. I have great tenants and take very good care of my properties and I raise rents every year to maintain maximum profits and to keep up with my rising costs. I never have vacancy. As others have said, if you go long periods with no rent increases it becomes difficult to catch up to market rent. You’re losing a lot of money now but you can turn this around.

1 Vote

Quote from @Eric McCusker:

What are the thoughts on increasing rent? The lease renews this August.

Another data point is, I’m breaking even each month as is but building equity.

2 Votes

This is why “affordable” properties in D neighborhoods are no bargain. Have never had to evict in 20 years as a landlord.

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Modesto/Merced, California

Quote from @Eliott Elias:

Stay out of it.

This.

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Quote from @Craig Janet:

Quote from @J. Mitchell Bernier:

@Dan Williams so for simple math, if you can get a monthly cash yield of $220 from a TBill that means your risk premium $230 a month.

So the question would be is that $230 a month extra worth the risk of owning properties?

This is a question as investors we have to start asking ourselves now that we hadn't been before. Before the risk premium was $400 a month when rates were low in that same scenario, but now that has changed is it worth it? Some will say yes, and others will say no, but the questions need to be asked.

I'm not suggesting you sale all your properties, but when examining new opportunities these are the types of questions we must be asking.

I agree with you Mitchell. In my market a $200K house will get you about $1500 after all expenses you will probably net around $1000. So that's 12K on a 200K investment for about a 6% return. Or you could take that same $200K and but in a CD at 5% and get $10K. Is that $2K a year worth all the hassle and risk of owning a property, not to me.

Either rents need to go up or house prices need to come down. Hopefully both. For the foreseeable future I'm holding on to my rentals and just investing my cash in CDs and treasury bonds.

Currently getting $17,500 for $200,000 with 8.75% first trust deeds. Something to consider in this market.

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I don’t care if my tenants defecate on their dining room table and uses it as a centerpiece. If they pay on time I will have the unit cleaned and painted after they leave. I don’t pester my tenants about nonsense and they stay for years paying on time. Don’t treat your rentals like you would your home. You’re running a business.

2 Votes

Have my cash in first trust deeds at 8.75%.

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Washington, DC

Do not walk away. RUN......

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Rapid City, South Dakota

I recommend an FHA loan or house hacking.

1 Vote

All Forum Posts by: Eric Gerakos

Eric Gerakos has started 0 posts and replied 672 times.

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