All Forum Posts by: Laura Williams

@Debbie C. I did not know there was a commission that regulates the utility companies. I will google that and reach out to them. Thank you for the suggestion. 

Wanted to post on here in case this helps save another Kansas City investor from a similar nightmare with KC Water. Less than a year ago my partner bought a house that had an inherited long term section 8 disabled tenant in there who was on section 8 for years and years. Everything was fine and then a few weeks ago the property manager calls and says the tenant's water had been cut off because the tenant owed 12K to the water company. Tenant then moves out of the house.

In trying to get the water turned back on to make repairs I talked to 4 different people at KC Water that tell me we can't get it turned back on until we pay the tenant's outstanding 12K water bill and flat out tell me "owners are responsible for tenant's water bill". Which as you KC seasoned investors know we are not legally responsible. I record this conversation and threaten to go to fox news and finally after being denied to speak to a supervisor I get a call back from one.

Supervisor explains to me that the section 8 tenant was actually stealing water so they didn't just turn the water off they actually dug up at the street and disconnected the main line. She says we don't have to pay the ex-tenant's water bill but we have to pay $1250 and have our plumber do a couple things to the line and then we can have the water connected again.

We unhappily pay the $1250 & our plumber files a permit and meets KC Water out at the house. They tell him they will not reconnect the old water line. We have to dig an all new water line (as if the house never had water at all going to it). The house is older (as is alot of houses in KC) and that the old water line was considered grandfathered in as far as codes and was fine but when KC Water messed with the line to cut off water from the tenant then now it is not considered grandfathered in anymore. The whole line has to be redone and plumbers bid is 13K to do this!!!! They have to dig up the yard and street and it's this big deal.  $1200 of the 13K is yet another fee that is going to KC Water.

So basically because KC Water was angry with the ex-tenant for stealing water they did 13K worth of damage to the property. KC Water NEVER at any point notified the owner there was any kind of problem BEFORE they did this. We found out the hard way what they had done AFTER.

*Section 8 tenants sign contracts with section 8 obligating them to be personally responsible for being in good standing with utilities otherwise they loose their voucher but apparently section 8 never checks that FYI. When I looked into the ex-tenant's water bill he hadn't paid since 2015.

For my fellow investors just want you to be aware of what happened here in case you ever encounter a similar situation & what kind of company KC Water is to deal with. I still can't believe this kind of thing is legal & especially to cause such an expensive repair/damage to a property without even being required to send out a certified letter or notify the owner in any form or fashion BEFORE doing something like this??!! The water company could have easily switched service to the owner name like what happens when a tenant moves out but they didn't. This is not to mention the first few people I spoke with at KC Water who incorrectly told us we had to pay the ex-tenant's 12K water bill which we could have gotten taken for if I hadn't known better.

 ***I'd be interested in speaking to any lawyers who are familiar and have won cases against KC water if anyone wants to get in touch with me*** The advice I'm getting is that we have no power to fight them and KC water can do whatever they feel like.

@Max Amillion

You might want to try a different shelter agent. From my experience with them each office is a little different. I had one shelter agent who told me no more than 500k liability (on a single family) and then I talked to another 2 shelter agents who could do 1 million in liability no problem.

@Max Amillion

Guard Insurance might be one to try. The came in much cheaper than the other companies I was quoted on a 5 plex. It's a Berkshire Hathaway company. We did have a claim a couple years ago through them....had a garage burn down and they paid. We didn't have any issues with them. If you want to PM me I'll send you our agent's info

Another insurance company in Missouri I found that had cheap rates is Shelter Insurance. I don't know anyone who has used them to know how they are with claims but they seem pretty popular.

@Alfred Litton

A couple tips I can give you is to ask your insurance company if they give utility discounts for things like new roofs, HVAC systems or redoing plumbing, electrical etc. On some of my properties I own I did extensive rehabs (bought crappers and fixed them up) and the insurance company I use gives big discounts for redoing these items. They never offer to tell you about these programs ...you have to ask. On the houses I qualified for the utility discounts on it cut my insurance bill in half from what I was paying before. So if you’ve redone any big items or bought turnkey where that work was done & you can get the contractor to sign off on it you might could wrangle a better price.

Another thing you can look at that might save a little bit is getting a blanket liability policy to cover all your properties. State Farm has one in my city for $250/year that covers up to 25 properties for 1 million each in liability.

There are also wholesale insurance companies where you can get discounts on home insurance buying in bulk. I know a couple investors who own 100+ properties that were able to get significant savings verses buying from the local companies like State Farm and Farm bureau etc. I think they told me they saved around 30% from what they were paying before. The only thing is you need quite a few properties to get the discounts but one company I spoke with told me I could partner with other investors and we all go in together. So that might be something to look into if you have friends or family who own a few properties that you could go in together on the same policy.

@Nathan Yarnell I own and invest in the KC area. For here with single family homes it is standard that the tenants do their own lawns and snow removal. If the tenants don't mow the grass and you get sent a violation from the city most property mngt companies will send someone to cut the grass and then charge it back to the tenants plus any fines from the city. So if you're managing your places yourself you may want to include something like that in your leases.

For multifamily properties it usually falls on the owner to mow the yard & do snow removal. 

Some landlords might include the lawn care in the rent on a SFH but that is rare from what I've seen & they would want to increase the rent to make up for that added expense...at least $50/month.

Hope this helps :) 

@James Mcsweeney

I have several properties in KC. I think the cost seem in line but just a couple thoughts that come to mind

1. Does the whole house really need repainting? When was it last repainted? I'm thinking if it was painted recently then just touch up the wall paint and repaint the trim and it will look as good as new & much cheaper and quicker. You can also get alot of marks off the wall using magic easier. Also make sure to ask exactly what they are painting for that price. Some people will bid a paint job and then not include stuff like the ceilings or trim or certain rooms and closets etc etc. and tell you that is extra which is really annoying so ask them specifically what they are repainting for that cost and get it in writing. Also if you get it repainted keep careful records of exactly what color and type of paint is used so you can touch up between tenants & that will save you tons of money in the future.

2. As far as replacing carpet I wouldn't advise. Tenants don't like it ..looks dated & ugly plus carpets retain smell and they tend to need to be replaced between every tenant so I wouldn't waist my money and do vinyl wood floors instead or refinish hardwoods if underneath.

3. I wouldn't replace ceiling fans unless they are broken. I've found tenants do like ceiling fans in the bedrooms as the KC summers do get really hot. 

4. Fix cabinet & Vanity.  I'm wondering if its same price to just replace it instead of fixing plus you'll get more life and usage out of them....rather than just "fix' and 3 months later new tenant breaks them again cause they were duct taped together for $200 each.

5. Not sure why the outlet's need to be replaced if they are good and working. If it's a cosmetic thing you might could scrap that cost.

6. Definitely go after the tenant and keep the deposit if they did damage for all this.

The cost of materials is going up super fast. Just in the past year wood is 30-50% more expensive I'm being told as well as other building supplies. So if I had to guess I think we are in a new normal. I highly doubt prices in general will ever go back to where they were 5-10 years ago because of the replacement cost being so much higher now. Although I think some densely populated areas of the country the RE will take a while to recover from covid shut downs killing off the small businesses & these lefty leaders who are letting crime get out of control & horrible at attracting business/jobs to the area...like NYC.

Plus we have the government pumping trillions of dollars into the economy which is going to make everything more expensive. And the Biden Administration is making policy changes which will make the price of oil/gas go up which will also make all things more expensive.

Covid and the new movement to work from home has also increased demand for housing and people wanting bigger homes so they can work from home. I think alot of businesses will probably not go back to working from an office and some of this demand will stay even after Covid goes away. 

So my crystal ball says generally RE prices will stay the same or go up ...probably not any giant gains like what we've seen past few years. I think flat to slightly positive is my best guess.

Should be interesting to read this post again in a couple years to see if my prediction was right lol. 

@Suzanne Chan

I went through similar to what you are right now with a 5 plex from hell. Adding the security doors with codes will definitely help alot with people coming in who shouldn't be. Here are some other things I did if this helps you.

 I got high speed internet throughout the whole building (cost was $65/month) and then I offered it as a perk to all the tenants. Over time this helped me attract better tenants to the building cause other buildings don't offer this.  Then I bought Wyze cameras and put them up everywhere & linked it on the new building internet....like 12 cameras...everywhere I could stick one I put it inside and outside. They cost about $25 each on Amazon so if someone steals them who cares. They do need to be plugged in to an outlet.  So for most of them I put in those special light bulbs that you can plug a cord into and ordered long cords & hung them up high...not the most attractive way but it is a lower income rental building so doesn't need to be pretty. You can also just have your PM handyman install them. You don't need to pay a specialist.

Then I shared the camera codes with my property mngt and also with 2 of my best tenants there so they could help keep an eye on the building and if any riff raff came on the property they could yell out at them through the cameras to go away without being put in a dangerous situation. The tenants actually kept a better eye on the cameras then I was able to & were invested in it.

The other thing I did was to offer discounts on the rent whenever a unit came vacant to anyone who is/was a cop or in the military. I got 2 ex marines in the building now and they took care of the leftover hoodlums the first couple weeks they moved in. Plus now there's American flags everywhere in the windows which also sends a signal to people thinking to break in.

Good luck with everything and hope it all works out ;)

Just my 2 cents: Obviously the more cashflow & higher rent to price you get the better...everyone would agree here. But I think that times have changed and the 2% rule isn't realistic in most markets anymore. That worked a few years ago really well for some people after the RE crash but it's outdated advice now. Now days I think the golden opportunity is in getting really cheap mortgages. My friend just got 2.5% rate on a second home fixed for 30 years. His monthly payment for a 320K loan is about the same as my loan (with higher interest rate) is for a 200k loan.