All Forum Posts by: JJ P.

I'm in San Diego County also.  The County rent control rules are different than SD city.  That's worth checking so you know what overlays apply.  

There's a huge shortage of rental housing countywide, so rents have really jumped in the past year or so as the vacancies come on the market. Between the market rate increases and long term tenancies, you might not have an opportunity to adjust the rent as the unit turns. A client of mine just increased the rent by $350 a month on a vacant 2 bedroom SFH this month. That's $4200 a year! If you have a very long term tenant and don't creep up, then you'll end up too far under market, like my client did.

In Southern California, rents are so high and COL is so much, that it's wise to creep up a little year by year just to keep up with the cost of living.    I think that $50 or so a year is expected, and would be considered by most tenants to be a small increase.   I'd also consider the type of housing- a 5 bedroom executive home and a studio granny flat are going to have different, minimal baseline increases.   

I read through every bit, but couldn't expand the graphics into a readable size. 

Exactly!   Purchases in California tend to perform very well, but the cost of entry is high.   There's nothing wrong with jumping into whatever market that you can afford, though, and if you jumped in last year or earlier, you're probably very pleased. 

The biggest hurdle to STR is a housing shortage for LTR in the area. Other than the zoning regulations, the sky's the limit in terms of demand. STR are often mom and pop enterprise at it's finest.

When you graduate, you will have many excellent job opportunites and the time in school will count as time in the career, so it will be fairly easy to get a first time buyer home loan.  

 If I were you, I'd use this time to build my down payment and savings buffer, and target your future job market location.  I'd also scout the first time home buyer incentives available.  A good lender will help you with that.  Then, when you get your job, buy a home or condo with a minimum of 2 bedroom.  Live in one, rent out the other(s).  Your roomate will help you pay the bills.  

 Two years later, regroup and decide if you're staying or getting another.   At the two year mark, you will have fulfilled your owner occupied lender requirement and be eligible for capital gains exclusions by satisfying the residency requirements of 2 out of 5 years as your primary dwelling.  

Without question, the deposits should have been transferred.  The deposits belong to the tenant and are held by the landlord.   The seller should have given full disclosure, and a buyers credit or accounting, of the deposits that he holds for the tenants.   I'd start by carefully reviewing the signed contracts for the purchase. I'd first do it at home, with a draft copy and heavy use of the highligher marker. A yellow highlighter is your friend.  Then I'd ask my agent, and possibly my attorney, for answers.    Many people, possibly most, don't actually read the contracts that they are signing, and then they don't abide by or agree to the contract because it takes them by surprise.  

I'm sorry, but this is poor landlording.  You gave the tenant the one and only key to your rental home?  Keys are a dollar at the hardware store.  You should have a duplicate set for every house you own.  But now you have a bent key and you want to know if it can be copied.  Take it to the hardware store and ask them if they can copy it.  Or better yet, a locksmith that might have more skills than the hardware store clerks.   Why ask us?   Get in the car and find out for yourself.   Is there more to this story than you're telling us, if the tenants are uncomfortable with you having a key?

For my entire lifetime, all of which has been in Southern California, it's well known that you can cash out your home here and move somewhere else and get much more home for your money.   But once you move, you can't really afford to come back.    A starter 1000 sq ft home in LA or Orange County is 650K+.  That same money will buy you a mini castle with acreage in many states, or an oceanfront/lake front/riverfront home, etc.   So you get great value, lotsa bang for your buck.   What you don't get is appreciation.  That's why the prices are low.  You can't have it both ways, unless you're lucky enough to buy into a growing market at just the right time (I'm looking at you, Idaho and Texas.)  The reason our prices are high and many other areas are not is because California real estate values just keep climbing.     So you can take your 6 figure equity gains and buy something very nice, but since that very nice home is priced low because the appreciation is lower than in California, your gains over time will be less and the gap between what you sold and what you bought will widen.  

On other note, nearly everyone I know who left the state did so because they wanted to spend less on housing.   That makes perfect sense.  They were the ones with deep pockets, leaving California and simply delighted at what their purchasing power was in other places.    We did the same thing, but with rentals instead of our primary dwelling.   We are delighted with the out of state purchases that our San Diego appreciation profits morphed into.  

Just an FYI, I was always a big believer in having the buyer write a nice, personal letter to the prospective seller and including it with the offer, but our realtor board has recently taken a stand against letters as possible violations of fair housing laws.    If your realtor follows these guidelines, you may not be allowed to include a letter.  

I don't think this a troublesome tenant at all.  There's nothing wrong with getting notice, she gave you more than 30 days, plan accordingly.  You bought the place and increased the rent hugely immediately.  She feels it's too high/unaffordable/time to move on.  She's going to look for something that works better for her.  Tenants move all the time.  There's no need for drama here.  

 I'd accept her notice with a very nice note, and wish her the best.  I wouldn't show the place while she's in it-- that would breed bad blood in my opinion and I wouldn't do that to anyone myself.   I would be kind and polite to her.  You actually made a move that would cause most tenants to rethink their occupancy-- bought the place, hiked up the rent, and expected her to enjoy it.     From her point of view, I don't think you're coming across as amicable.  

Also, why ever would you volunteer to include utilities that are already tenant paid?  What was the logic there?  We steer away from landlord paid utilities whenever possible.