All Forum Posts by: Lisa Verna Staggers

Thanks Erickson.Can you please provide more details on how you would passively invest in a larger commercial deal? How would that look?

After 9 years in investing in a 4 unit in DC with section 8 tenants, intense city govt regulations, multiple fines and tons of (painful) lessons learned, I am done. The tipping point is the recent DC Government legislation mandating that all property owners clean their common areas (door knobs, Mail boxes, etc, daily, using an approved EPA cleaning kit with no regard to how unreasonable that is for small landlords). The bright spot in my situation is the area has appreciated significantly over the past 9 years and I stand a good shot at nearly doubling my initial investment. I like the idea of rolling the proceeds into a lower maintenance, higher quality property in a landlordfriendly state. Admittedly, I am burned out and a little turned off due to my experiences ( although I recognize my experiences are not the norm). Any suggestions on where I could roll my money for an easier time, and higher quality property/tenants? I could potentially have $300k - $350k to toll over and thinking seriously about a condo due to ability to attract higher quality tenants with less maintenance or a 4-unit in a lower priced area such as Hagerstown, MD but I am weary of lower priced buildings after my experience. Welcome youR thoughts!

Lisa

Will do. Thanks so much! Btw, I let the seller know I decided to pass on this one.

William- wow how did you know? Your right about the address! 

Ryan- thanks for the additional insight. I did not think to add in 10% for CAPEX and also the vacancy. When factored in it makes the cash flow even worse. I also suspected it might be over priced.

Harrison- yes the payment includes insurance and the rate is 5.5%.

My stomach is in knots on whether to put an offer in for the following property. I've been burned before so I'm extra cautious this time around. It's also in a city I know very little about (Norfolk, VA) here are the numbers- I welcome your thoughts/ insights:

$259k - sales Price (4- unit building fully occupied)

$1460- total mortgage payment (after 25%) down 

$305- Property Management Feee (10%)

$105- trash (total water is $315 p/m but seller bills water to tenants and has it written in the lease)

$60 - lawn care

Total rents are $3050

Owner says monthly expenses are low.

The best case scenario is net income of $737 assuming $400 extra monthly expenses (for worse case scenario unexpected expenses which always come up) and assuming all the tenants pay their rent.

Positives- 

- Seems to be a good cash flow if expenses are kept low and everybody pays

- 4-plex is located in an 85% residential area

- building is ok condition (built in late 70’s) except roof is 18 yrs old

- all tenants are gainfully employed

Concerns

- while the neighborhood visually looked fine, according to crimemapping.com its a moderately high crime area. When I called the local police dept to verify all they would tell me was it was medium crime area

-owner put it on the market 3 times in the last 3 years and took it off. Now it's a FSBO. Did he take it off because he couldn't sell it? If not why not? Am I missing something?

- have to rely solely on a PM given I am not local. (I’m 4 hrs away). Need to find a PM in the area willing to go the extra mile and physically read the water meter each month so the water can be charged back to the tenants. Given the high water bills this is a must.

Based on the above, what do you think? Am I missing something???

Thank you Dave and Russell!!

Hi Everyone,

I own a small 4 unit bldg. in DC with mostly section 8 tenants.I am seeking a strong management company that can do most of the heavy lifting as I will need to travel more this year for work. Its important that they understand the DC laws and do not grow weary given the issues that section 8 tenants can bring. I am finding that it is extremely difficult to find good property managers in DC.I don’t know what it is but in my experience they have been mostly terrible, do the bare minimum and take more than their fair share (ie pocket rent money by hiking up expenses, very unprofessional, etc.) If I had the knowledge years ago (when I bought the property) that I have today, I frankly would never have bought in DC. But back to the topic at hand – any recommendations on any good property managers?

Lisa

I just went through 3 terrible property managers and have been burned so badly I am now managing 2 tri-plexes on my I own - not my choice I just don't trust any PMs anymore after being ripped off. For example, due to the lack of attention from my previous property manager, unbeknownst to me I had trash sitting on my lawn for 3 months and got fined by DC in the amount of 4k! I got it reduced to $2550, but still way more than I can afford. Also, I've now had the same vacancies for 9 months and another tenant has since moved so I am losing money each month. At this point, I need to stop the bleeding and need help filling my vacancies. Are there any good agents or tenant locating services in DC? My tri-plex is a good building but not the best part if town.

-lisa