All Forum Posts by: Johnny Hastings

Your question is a bit broad, but I'll take a stab. These things are going to be dependent on many things, such as number of units, local service costs, and who knows what else. These apply to my situation, here in Central WI. 

These stats are for a 12 unit. Built in 2002. Heated via a gas boiler, that also provides the hot water. These will be average monthly costs, as you asked for:

Insurance: 222.33

Water / Sewer: 450

Garbage: 207

You didn't ask for these, but I'll toss them in for the sake of leaving a complete list of recurring expenses here. 

Gas / Electric: 275

Property Tax: 710

We have plowing expense in the winter, depending on whether the snow is flying. That's $80 per snow fall. Summer expenses for mowing are less, perhaps $40 per month. 

Monthly cleaning of the building and property totals about $100. 

That's the recurring expense list; I think it's complete. Hope that helps. 

I've painted a pretty sizable brick exterior. Are you doing it yourself, or contracting it out? I assume doing it yourself, based on the question.

Get a good exterior primer, intended for this type of surface. Zinsser Bull's Eye exterior primer. The brick soaked up a ton of the primer, so get some extra before you start. You can always return the unused portions. I used exterior grade paint as well. Make sure your primer color is somewhat close to your paint color. I primed white, then painted dark brown. I had to do 3 coats of paint to get it to look really good (I'm a bit of a perfectionist).

If you have the option to rent / borrow a professional paint sprayer, do it! All the grout lines and angles of the brick took forever to paint with a brush. Don't buy a cheapie paint sprayer either. I burned through 2 of them trying to spray latex, and it more frustrating than anything. 

It's been 5 years, and the paint has help up with out any issues what-so-ever.

That's a tricky one. 

I've had tenants that were there for a few years get upset when I raised the rent $15 / month. 

I think your best bet is to give them proper notice of the rent increase, but plan on them leaving. If they want to stay and pay market rent, so much the better. 

Typically some people will leave right away when a building changes hands. It happened to me, even after I met with the tenants and said nothing would change. They get skittish for some reason; perhaps they were thinking of leaving for a while, and the property changing hands was the final motivation. Who knows?

Make sure that as people leave, and you have a chance to get in the units, that things are on par with the market. If you're units are out-dated, have poor appliances, older carpets, or whatever, and places going for market rents are updated; then you make the improvements to warrant the rents. If you avoid doing that, you will have trouble finding renters. 

I am not sure how to proceed with the Section 8 person; as I have no experience in that regard. Perhaps someone else will get you an answer to that here. 

Great post Ryan! I very much enjoyed that!

I'm not from the area, but I can offer you a way to do some research. 

Sounds like a RUBS system is in place. It stands for Ratio Utility Billing System, and it's a thing. Google that, and read up!

Nathan and Aaron are on point here. 

You can't let the proverbial bad apple spoil the whole bunch. 

It always feels like a hassle to get the paperwork process going, and there's always the worry that the tenant will mess stuff up in the apartment/unit when you do this. Those are just things you have to brush aside.

Once you properly handle this situation, and get the stress of potentially losing a good tenant out of the way (and get someone who's not frequently causing trouble in); you will feel 100x better! It'll be like a weight off your shoulders. 

The answers are: 

Yes, I use CL exclusively for 'for rent' ads. Well, that and yard / bandit signs.

Yes. I have tried apartments.com and facebook, even a few others. All the responses I got were from CL.

Not at this point. I'm still doing my own management, and I like to make first contact with potential renters. 

If you're working with an insurance agent, you're probably doing as good as you're going to. I've been awed at the cost of insurance on my smaller rentals also.

I have a 3 unit, built in the eary 1900s, all brick, very sound structure, I paid $99K for it; the premium is $1535.88 annually.

I have a 2 unit, built int he 80s, in immaculate condition, I paid $129K for it; the annual premium is: $1518.72.

Seems like you're not terribly far off that. Perhaps it's not the structure parts of the coverage that makes up the bulk of the premium? I can't read that attachment too well. 

It's weird how much the insurance on larger structures comes down in price fast. I have a 12 unit, paid $420K, it's in great condition; annual premium is $2667. Go figure that one!

If you're concerned about it, call another local insurance agent. Tell them who you're working with, what you're paying, and they'll tell you if it's worth your time (and theirs) to have them shop it around or not. 

When you say 'request', it sound like you mean 'enforce'. In WI, I could make that request, but there'd be no way to actually enforce it. For instance, if they didn't get the renter's insurance, there's be no way for me to evict them on those grounds. Even if it was written into the lease, I suspect a judge would not grant that eviction. I'm not sure how you'd get a concrete answer on that item. Perhaps have a consult with a real estate attorney? You may be able to call around to real estate attorneys, tell them you're a landlord, and see if they can answer some questions for you. I've had good luck in my small town with getting help from attorneys like that. 

Short answer: yes, that sounds like a nightmare to accomplish. Granted it depends upon the way the property was constructed, but I'd wager they never did it with the intention of it being split out. It's likely going to be way more expensive to accomplish that than what you'd want. 

Look into a RUBS (ratio utility billing system). it's a solution to this issue used by some managers. Effectively, you bill back an equal portion of the utility to each tenant. It's more office work on your side, since you have to be generating and mailing monthly bills; perhaps it can be contracted out. Depending on your PM set up, it may fit in nicely. Also, it costs almost nothing to implement; especially relative to the reconstruction of the existing HVAC system in the property!