All Forum Posts by: Jeff Copeland

Related to plumbing (and certainly helps to have a background in plumbing) is Leak Detection services. It can be very lucrative, and relatively easy (compared to actually fixing the leak, lol). 

You may be right, but little tiffs like this (with otherwise good tenants) can end up costing you thousands of dollars in vacancy and turnover costs. 

A tenant who might otherwise have renewed their lease for two or three years will likely say "no thanks" come renewal time when they get nickel and dimed for things like this. So you end up spending a couple grand on painting and rent-ready repairs, and eating a month of vacancy, over a $99 service call. 

Choose your battles wisely. 

It also discourages tenants from reporting otherwise important maintenance items ("I'm not reporting this leaking sink drain that's the destroying the kitchen cabinets, they'll just blame it on me and try to charge me for it.").

Finally, it's still quite possible that the oven has an intermittent problem, or a problem that was not accurately diagnosed by the technician (especially if it was a warranty or home warranty service call - they generally avoid making repairs at all costs). 

These tips are rather generic, and you left out some crucial data points:

Eviction Records Check - Most tenant screening tools will check nationwide county court records for eviction lawsuits (sometime referred to as "delinquent tenant" or other similar terms in court records). It is also critical to check your local county court records - It is not unheard of for an eviction case to be pending in local courts, but not yet show up on national database checks. 

Criminal Records Check - Similar to the advice for evictions listed above, check both national and local records, and be sure to comply with the HUD Guidance here. For example, you cannot deny an applicant housing based on criminal charges or arrests (only convictions), and the conviction must present a "demonstrable risk to the safety of your residents and/or your property" in order for you to legally deny them housing.  

It is also crucial that you have published written standards (so tenants can see ahead of time whether or not they should qualify), and apply these the same to every single applicant to avoid Fair Housing and discrimination complaints. 

Finally, when you inevitably deny someone housing, you are required by the fair Credit Reporting Act to provide them with an Adverse Action Notice. 

Realtor (in the sense of a traditional buyer's agent / listing agent) would fall under brokerage. 

The most comprehensive guide I've found is at 
https://www.therealestatecpa.com/guide-to-qualifying-as-a-real-estate-professional (no affiliation)

We recently launched our first coliving/homeshare property (as a property management company) in St Petersburg FL. Here are a few lessons learned:

Zoning: You'll need to do some research with each local municipality. We found that in most Cities, 5 to 6 people in a home seems to be the line in the sand. Below that, it's no different from roommates. If you have 6+ people, some cities consider this a roominghouse or boarding house, which triggers different requirements. Parking is often another limiting factor.

Marketing & Fair Housing: While you can certainly target them with your marketing efforts, you can't limit your property to only nurses, or only college graduates, or only males/females, or impose age restrictions. You still have to comply with Fair Housing laws, and an applicant is either qualified for your rental unit, or they are not, based on your published (and legal) screening criteria. 

In terms of minimizing headaches, obviously you need crystal clear screening criteria as well as established, published, and posted household rules that everyone understands and agrees to up front (and via their lease). These need to be stressed early and often. 

In terms of challenges, the lease-up process is much more involved and takes a lot more legwork. For a traditional rental, you may show it 5 or 10 times, take a couple of applications, them move forward with a lease. In a coliving environment, you might show each room 10+ times, and then reject more applicants (because you don't have as much flexibility with regards to screening, pets, # of people, etc). You also have to educate a lot of people who don't understand the co-living model.

We provide wi-fi only. Most people stream their entertainment these days and cable TV is getting more and more antiquated. 

And yes, someone (such as a property manager) needs to be in charge, obviously. I do not think it would work well placing one of the tenants in charge. 

BTW - The coliving model seems to be more aligned with large single family homes. I could foresee some additional challenges trying to implement it in a multifamily setting. 

Also be sure to check out https://www.biggerpockets.com/...

A large percentage (90%+) of conventional, FHA, and VA loans get sold in the secondary market 6-12 months after origination. This is why Fannie Mae and Freddie Mac exist. It's typical and happens almost every time.

Like @Nathan Grabau said, your servicer simply collects your payments and manages your escrow account for taxes and insurance. It isn't rocket science. Other than updating your payment information and making sure your payments are going to the right place, it's usually not a major change. 

What are they getting wrong?

Sent you a PM with some info to check out.

There are a lot of factors that go into this:

1. Electrical: You need space and capacity in your electrical panel for one new 220V circuit for a dryer, and one new 110V circuit for a washer (some stackable units just require a single 220V outlet). You'll need an evaluation/estimate from an electrician for this. The cost could vary widely depending on the panel (could require a panel/service upgrade) and the distance from the panel to the washer and dryer (wire is expensive, long runs cost more).

2. You'll need hot and cold water on the supply side. This is often relatively easy, especially if the connections are going to be adjacent to the water heater (which is often the case in a utility room). 

3. You'll need drain plumbing for the washing machine. This can range from fairly easy (in wood frame construction with crawlspace access, for example) to very difficult (in slab on grade construction with drain plumbing under the slab, for example).

Obviously, you'll need a plumber to provide estimates for 2 & 3. 

4. You'll need a dryer vent. Again, this can range from easy (cutting a hole in an exterior wall with wood frame construction) to much more difficult (block construction, multi-story or basement applications, for example). 

For property managers, this is part of the Property Management Agreement. The PM acts as an agent of the owner. 

The second piece is what type of licensure is required by your state? Many states require a real estate license to practice property management, and almost all states require a contractor's license to be involved in any type of construction/renovation work. 

Yet another piece of the puzzle is liability, and liability insurance. If you hire the contractor, and the contractor burns down the house or electrocutes someone due to poor workmanship or negligence, what is your liability? And how do you insure against that liability? Most professionals in many fields carry both liability insurance (aka General Liability or GL) and errors and omissions insurance (aka Professional Liability or PL). 

 On what grounds would you keep the tenant's money? You are the one breaking the lease!