All Forum Posts by: Jeff McCaskey

@Jordan Decuir 

Hey Jordan, welcome to BP and investing. Not sure how log you've been  in the game to this point but welcome none the less.

I don't have but just a minute right now to post but......

Go for it and do Multi. I did, first deal was a triplex. Half my portfolio is MFH but the majority of my units are located in MFH.

1 roof multiple doors, several tenants in one place makes it easier to handle for the most part. Have an empty unit.... no problem, mortgage still gets paid from 2 other units etc.

No fear, jump in!!

Its not always about being the biggest and baddest or smartest guy or gal in the game. Really what it boils down to on anything in life is being "enough" of those things at the particular time. It boils down to NEVER QUIT!!! If you decide  to NEVER QUIT, you will always win in the end.

Cheers to everyone who NEVER QUIT!!!

@Tim G. 

You know what they say.......

Don't sweat the small stuff, and it's all small stuff... Lol

We all have days or projects like that. Or least I know I certainly do.

Per the others - way to keep on it when it got tough man. That's how you win. NEVER QUIT!!

I actually need to call the termite guys tomorrow to schedule a treatment date for the flip I'm working on......

Thanks for the reminder!!!! Lol Man I should've been a little smarter on that one, thank God for bigger pockets!

@Lisa Carpenter 

To be honest i am not familiar with the AZ landlord tenant act and its provisions. Nor am I familiar with exactly how extensively written your lease may be.

However, I set up my lease carefully though I did not personally have it written via a lawyer - but my lease is clear and lengthy and if a tenant violates a provision I can declare the lease null and void and end the relationship. 

In most cases I will discuss an issue and attempt to resolve it politely especially if they have been on time with payments and have had little other trouble. If a person has obviously been taking advantage of all the small ways they can push the limits then they are quickly handed a letter discussing the problem and the lease agreement provision(s) and given a 3 day pay or vacate or just a vacate notice. Relationship over.

In the case of anything that prevents them from paying the rent, there is always a reason of course and that should be discussed even if a landlord is not fond of a particular tenant. In my mind everyone deserves the chance to be heard - the first time anyway. 

If it's a problem with a solution then great and it can be fixed and we go on about our business together. 

If they can't pay and there isn't a solution to the problem (resolving little things not big ones) then I basically tell them in a polite manner that whatever their problem is, I am not responsible for it and they should not make it my problem. I agree to provide A B C D etc in exchange for a fee. I am not a marriage councilor, a quick cash business, bank, humane society etc etc.

I say all this to make the point------- Have a lease    Stick to it       Be firm     Don't make concessions     It's an agreement/contract       Hold them accountable     They are an adult      Don't accept a reduced rent because you feel bad for them - this is a business not a charity.

Because you accepted some sort of payment of rent you may not be able to count this month as violating the lease on the rent amount - you will have to check state and local laws.

On the pet provision that was broken, you should be able to give them a 30 day vacate notice for violating the lease agreement. Again check with local and state laws. Search for the landlord tenant act for your state and read through it, many answers should be in there.

Well this is awesome so far! Thanks for all the reply's. Keep up the input, I really want to hear what everyone has to say on this :)

I can't even keep up ha ha!!!!

@Elizabeth Colegrove I wish you the best of luck out west, but if I followed your path on this in my particular market, again in my market (you might have a 180 from where I'm located) well I would be out of business....... There are ways to know what is BS and what isn't. 

If they don't measure up for some reason even one beyond their control - they don't rent. Plain and simple for me.

@Diana Tian 

I have been through this a number of times personally.

Usually an inspection will reveal some degree of termite damage in most homes. Like was previously stated, it can be from previous termites or it can obviously be a current problem that needs to be addressed.

NOW..... The best chemicals on the market today are supposed to be active for a 10 year period before they become ineffective. Those are the BEST chemicals mind you. 

If a seller can not prove or demonstrate that the residence/structure was treated within the past 10 years it is almost a sure bet that your bank or financing institution will require you to treat for termites. That means that it could have been treated last year but if there is no way to document that, then you will likely be required to retreat, especially if there was any evidence of damage found during the inspection.

I have purchased property which you can obviously tell has been treated previously by observing the exterior for signs of prior treatment but there was no documentation on the date of treatment and I was required to retreat. And that has happened to me multiple times.

So I guess when we are talking about the cost of buying a deal this really ought to be figured into the cost to purchase, but it's actually a cost that is really really easy to forget about until it suddenly pops up out of nowhere.

Great question!!!!!

I just wanted to hear from anyone and everyone about this topic.....

I have been doing this for about 5 years now and probably run through 100 different tenants (total number of people - not turned over units) in my time and I check every application that gets turned in!!!

BUT....... during that time I have only had ONE, yes count that ONE, other manager call me to check on a previous rental reference for an applicant.

So since I basically get nobody at all, ever, whatsoever, calling to check references I am forced to assume that the VAST MAJORITY of landlords don't ever make the phone calls.

Like I said, I sure as hell process ALL of my applicants. Have the rest of you had any experiences similar or different to share????

I can't wait to read what you have to say :)

Thanks!!

@Mark Boek 

Wow Mark, if that company will manage 1 unit at 7%, and does in fact do a great job then you should flood them with clients!!!!!! Yeah that is the first time I've heard of that rate for just 1 unit, it always seems to be 10% or slightly higher for just one unit under management......

@Lisa Carpenter 

Good question. I don't use a hard and fast rule for the income portion with everyone across the board.

And there are factors to consider such as what is included in the rent..... Is it just rent and tenant pays ALL the bills or is it ALL BILLS PAID or SOME BILLS PAID type of structure??

If the unit is rent only covers rent then sticking close to that 1/3 (33%) of income number plus or minus a few points is probably the safe bet on getting your money every month. They will have to pay utility bills on top of rent.

If the unit is all bills paid then you should be more lenient with the ratio because they don't need the extra income to pay bills since you are already paying them. Maybe up to 50-55% of income is acceptable.

If the unit is some bills paid and not others then something between 33% and the 55% is more workable.

I would think as with any tenant you have to use discretion in the matter. Say someone works in a field where incomes are subject to change dramatically such as oil and gas, certain types of construction like road building etc, these people may work large numbers of hours and make good money but there is usually some level of base pay and should conditions change such as oil prices dropping or say having a wet summer where construction might be delayed for extended periods etc, you will want to evaluate a prospective tenant on a base pay as well as the highest gross income possible.

In an oil and gas situation it would be totally possible for a person/family to make $4000 a month right and your rent lets say is $1500/mo, well what happens when the price of oil drops and there is no overtime pay coming in and that monthly income drops to $2000/mo???? Will you get your rent payment or will they pay the 2 car payments and buy food and take Jack or Jill to the doctor because of the chronic bronchitis they have had since they were 2 years old......??? (just had a tenant leave yesterday in this exact situation, numbers were different and they had a new baby not a chronic health issue but the job was oil and gas fracking and income was cut in half in a matter of 60 days. They found a different job for the husband and left - leaving the security deposit behind)

These are all things that a manager or landlord needs to know about their market and who is applying to rent. Further more about knowing your market, it's not good enough at times to know employment is good right now, or that yeah other factors are good right now. You should take some time to know MORE about what drives the market you are investing in and how those drivers of the market can, will or won't change.

An example in the other direction might be that someone builds an ethanol plant on the edge of town, and yes that may be subject to fuel price, commodity prices (corn used to make ethanol) and oil and gas markets etc etc but just for the sake of the argument.... Lets say the plant is built and its a 20 million dollar or a 75 million dollar investment to come online and produce a product. Well it's not likely that someone spent all that money to close a plant in 12 months or 24 months from now and walk away, so it is probably more secure than oil and gas drilling activity. If that plant brings 100 new jobs to the area, you can probably bet they will be here next year and the year after.

Same would go for a new hospital that might now be open. You will need all kinds of people to run the facility and treat patients and that is not likely to change.

These might not be the best and most true examples one could use but it's what came off the top of my head and you should get the idea I am getting at I hope.