All Forum Posts by: Karthik Bujuru

@Karthik Bujuru Get a PM. Taking everything else out of the equation: at the very least they'll drive by the property from time-to-time. How else will you know what's going on in the home? Are they keeping it up? Is there a car on cinder blocks in the front yard? Are you going to fly out to Phoenix and show it to renters? If you drive by the home are there 4 cars parked in the driveway because they've moved other people in (in violation of their lease)? When the drain is clogged the PM can't send their maintenance person by so you'll be paying someone $99...and have to coordinate it. I'm just making up random stuff but it's a long drive from Fullerton to Phoenix.

"When the drain is clogged the PM can't send their maintenance person by so you'll be paying someone $99...and have to coordinate it."- I was planning on using Home Warranty thing to get the service coordinated, but nevertheless its a lot of work. thank you for the input

1 Vote

Originally posted by @Catherine A.:

Hello Karthik,

We self manage and use a PM on our rental properties and would recommend using a PM out of state.

That said, if you self manage my suggestions are to check credit history, check past landlord references (call until you talk to someone or ask for other references) and keep your rent at slightly less then market. That gives the perception of value, increases your tenant applicant pool, and helps keep vacancy rates low. The more effort you spend selecting the right tenant, the better off you'll be in the long run.

If you do hire a PM, vet and interview your PM in person. Vet several PMs and pick the best one for you. Require periodic walk throughs with a short report or some other method of verification. You can always switch to self management...or switch back if things don't work.

I hope this is helpful. Best of luck to you.

Catherine

I understand that there is considerable amount of work to be done if you were to self manage. I guess with a full time job, and being out state all this work seems impractical. I am leaning towards a PM. thank you for your input

1 Vote

Originally posted by @Jeff B.:

Being out-of-state forces the decision - - you need a PM. That's a hit on the NOI but your already into a problem that doesn't allow self-mgmt, especially for a SFR.

Personally, SFR + PM makes no sense because of the reduced NOI. If you're going out-of-state, at lease buy MFUs where the PM cost has less of an impact.

thanks for the input. I agree that the NOI is pretty low but I think it would be hard for me to secure the capital to invest in the MFUs. My plan was to build some equity through SFUs over the next few years and may be then try MFUs.

1 Vote

Hello BP,

I am going to close on my first SFR in Phoenix area in a month and I am trying to identify best route to rent and manage it. Should I hire a PM to manage since this is my first rental and I am out of state or should I self manage? If I were to hire a PM, I would probably end up making just about $50 in cash flow per my calculations. Is PM worth it for a first time investor given it eats up the cash flow considerably?

If I were to self manage, could you please guide me with the steps from the moment I close on the property to the moment tenant steps into the house?

Many thanks,

karthik

2 Votes

@Stanley Parsley Hello Stan. thanks for that advise. I am scheduled to come down to Phoenix in April 1st week. Currently listing out the SFR properties that seem to have decent cash flow to go visit in person. From my minimal learning, vacancy rate is top most priority (of course, only for the ones that have decent cash flow). However, securing accurate vacancy rates for an area seems challenging. I am planning to meet some PMs when I am there to seek their thoughts. I was hoping that you would share your source of vacancy rate data for Peoria, Suncity, Goodyear, Surprise areas.

thanks

karthik

0 Votes

Phoenix, Arizona

@Ken Min

Thank you Ken for the advise. I have looked into the idea of partnering with someone for my first deal, but I am sure you would agree that finding a right partner is a challenge in itself. I am not sure at this point if I would like to spend my energy to seek the right partner, instead I am willing to spend that time in learning the arts of the trade myself. I am sure I am in for a ride, ready to fall and willing to learn from my mistakes. Few months down the line Ill revisit this idea and get back to you if I want to partner.

thanks again,

karthik

0 Votes

Dear All,

My name is Karthik, I am a full-time medical device engineer working for one of the big players in that segment. I live in Fullerton, CA and looking to start investing in SFR in Phoenix, AZ. I have no background in REI but recently started to study the topic when it was brought up in one of late Saturday night discussions with a group of friends. I have spent a lot of time investigating the topic and stumbled across BP and was drawn to the amount of information on it. I have just finished reading "The book on rental property investing" by Brandon and understood that REI could be a relatively less risk investment option for me. My goal is to find a good positive cash flow SHR rental property in Phoenix suburbs in the next 6 months and I have already started to get some listings from one of the local agents and analyzing them.

I would look forward to learn more from BP members and do my best in sharing things I learn during this journey.

thanks

karthik

1 Vote

All Forum Posts by: Karthik Bujuru

Karthik Bujuru has started 2 posts and replied 17 times.

Post: PM or Self Manage First Rental Property

Post: PM or Self Manage First Rental Property

Post: PM or Self Manage First Rental Property

Post: PM or Self Manage First Rental Property

Post: Multiplex Investment in Greater Phoenix Area

Post: Newbie from Fullerton/CA looking to Invest in Phoenix, AZ

Post: Newbie from Fullerton/CA looking to Invest in Phoenix, AZ