All Forum Posts by: Aaron K.

My manager charges about 8-10% and he's a lifesaver.  Emergency repairs, he's there.  Tenant disputes, he's there.  Door needs fixing?  He brings in a contractor immediately.  I can call him directly with any questions or concerns and I know he's handling it directly.  He also manages all finances of the property - paying bills, contractors, facilitating maintenance, etc (with my signatures, of course), so I'm as hands-on or hands-off as I want to be.  I don't think I could sleep soundly not knowing who's directly managing my property.   I have a 7-unit in POK, as well as a couple other smaller places outside the city.  If you want his name shoot me a message.

Make sure you're still accounting for vacancy, capEX, repairs/maintenance, etc.

If you do NOT account for management, and there's no room in the numbers for management, and down the road you buy more properties and need to hire a manager, then this property will never make money unless you pay your manager to manage all of your other properties except for this one.  

Why are you responsible for cleaning up the mess?  Something is missing from the story.  I thought there were laws against evicting for damage to property not caused by tenant? 

One of my properties is a single family house, it's actually my old house that I now rent out.  It has a fire place, and a wood burning stove.  In the lease it states that the tenants are not allowed to operate either.  I did not block it off, but may in the future if it becomes an issue.

 Actually, I was just discussing that with my property manager!  She's on a month-to-month, so we could (and should) raise her rent moving forward.   We're actually going to try to get her on a new 1-year lease with increased rent and damage deposit.  We're also making it clear that we're not the prior owner and we do have rules now.   She also hasn't paid her March rent yet, go figure...

Hard money, private investors, bank loan, equity loan, HELOC, tons of options.

Do you have experience in rehab and flipping houses?  You want to under promise and over deliver for your investors, not the other way around.  10 flips annually is a hefty goal for even the most experienced investors.  Not to say you can't do it because I don't know your background, but I'd be leery of over-extending myself and not living up to promises I made my investors.

Depends on the condition and age of the property.  The 50% rule accounts for ALL of your expenses, and is a quick and dirty way to analyze deals.  It does not mean that you save 50% of your rent for maintenance.  I keep 10% of gross rent aside for annual maintenance.  That's worked OK for me so far.

My initial offer is contingent on clear title, C/O's in place, full inspection, attorney approval, and copies of leases.  After initial negotiation and accepted price, I schedule the inspection.  After inspection, re-negotiate if necessary based on condition.  THEN we write contract, which includes demand for ID's of tenants, certified rent roll, last 12 month financials, tax bills, and estoppel agreements.  We don't bother including all of that in the initial offer, because lot of the time the deal dies at the initial offer or inspection stage - so it's a hassle for everyone to process so many additional requests for every initial offer.  Not to say I do it the "right" way either, but it tends to be efficient for us.

I've had alot of deals fall apart post-inspection too, it's just the nature of the beast sometimes.  Sellers don't want to believe that there are issues at their property, and they never believe the repair estimates that you give them.  I was extremely close to closing on a property a few months ago but we found a foundation failure that would require a $30,000 fix (jacking up the building and re-pouring).  The seller brought in their own inspector that wrote the fix to the foundation would be $3000, so they refused to negotiate.