All Forum Posts by: Liam Goble

@Nicole Williamson, This may sound totally cold hearted, but I had a grandmother paying the rent while I paid water and sewer. She then moved her entire family into the unit. None of the family members were on the lease, but were quite obviously living in the unit. I reached the end of my rope with the situation and sent a letter calmly explaining that because only the grandmother was on the lease, everyone else in the unit were living illegally and would be removed from the unit if they decided to not sign the lease. I provided a new month to month lease and outlined who should sign (everyone over 18 and living in the unit) and the behavior I expected and what utilities they were responsible for (water and sewer). Very quickly I received the signed lease with all family members on board.

I did this for two reasons: 1) I own the unit, I want to know who lives there. I don't cater to dead beats or escaped convicts! and 2) All of the tenants are now responsible for the utilities and other payments. Before, it was just the grandmother, who is in ill health. If she were to die, none of the other people living in the unit are responsible for the bills. Now, they are all responsible for the bills.

@Nik K Make sure to check local zoning. I live in State College, home of Penn State. I don't invest in the college market, but in the 'college support market', meaning the homes and apartments all of the support staff rents. The State College Borough has a love/hate relationship with students. The Borough love the money students bring to the area, but hate the students. They have zoning in place to concentrate students to one specific area of the borough. The specific zoning requires small multifamily rentals to be located in very specific areas of the downtown. If you're outside of those areas, you need a minimum of 150' between student rented properties (this number has been creeping up each year, and I believe I've heard proposals for 500' between properties). In addition, the 1% rule doesn't hold in town. Many investors will pay using the 0.5% rule.

@Kevin Lopes I'm not Atlanta (I'm in PA), but my understanding of PA law is that if there is an existing lease and I purchase the building, I have to honor the lease. I haven't purchased any triple net properties yet, but the few triple net leases I have reviewed have included provisions for an annual increase in rent. Do the existing leases have anything for that?

@Account Closed , I developed a bunch of Excel spread sheets to keep track of my properties, bank accounts (checking, savings, LOC), all of my non-bank loans as well as a really good (for me) projection calculator to use when I evaluate a property.

I looked at a bunch of different software to use to track my properties, but I found the extra time I spent developing my own spread sheets coupled with the flexibility of Google Docs/Spread Sheets, I was able to do everything I wanted to do, except I didn't have to spend anything to get the software.

@Steve Nazari, My first deal was a $0 down (From me) with cash from a few partners. The partners I used basically had cash sitting in a savings account. They didn't trust the stock market, and felt it was OK to lend me the money to invest. I presented the deal to them, showed them the numbers, picture of the house, my projections and how I would pay them back.

I did this for a few reasons. 1) I wanted them to see the property was real and I wasn't going to run away with their money. 2) I wanted them to know there was a reasonable plan to pay them back. 3) Since this was my first deal, I wanted to show them that I had thought through contingencies vacancies, etc. 4) Both of my partners on this deal are entrepreneurs, so they could have run with this deal, but just as they trusted me with their money, I trusted them that they wouldn't run with my deal.

I'm working on my fourth deal right now. It'll probably be a flip. I'm partnering with an investor who 'has put her flipping days behind her'. She's made the money she wants from active flipping, but she is an investor and so she's trusting her money to me (with some advice along the way) to make sure the flip we're undertaking will run smoothly.

I really think that if you're questioning the trustworthiness of your partner, they probably aren't the right partner.

I think it would be awesome because you could make a video of every time you were in one of your units. When a tenant moves out and there is damage, you could go back through your 'visits' and see if that damage was present or not. I've got some tenants right now who complain 'the place is just falling down' and they always threaten to move. The issues they complain about are brought on by their lack of common sense skills (eg: if you get really drunk and decide to smash every bit of cookware on the floor and damage the floor...you as the tenant are responsible for the damage.)

I would simply caution to make sure you have some sort of legal partnership spelled out (LLC, LLP, etc). That way, you each (should) know what is expected, how to deal with issues, etc. I have 'partnered' with some friends in the past, but their only contribution were loans, they had no interest in the real estate.

I currently own three buildings (five total units). My monthly work is probably 5 hours in total and that includes the banking, loan payments, handy-man coordination, and fielding any phone calls from tenants. Some months are quieter and other months are noisier. I just got to the point that my processes are streamlined enough that I can usually handle all the paperwork over a 3-4 hour period once per month and then be finished, unless I get some phone calls. I don't think my paperwork would increase that much if I were to own more units because of the processes I have in place.

I'm dealing with a similar situation, only I like both tenants, they just don't like each other. One complains about burnt popcorn smells while the other complains of Goliath stomping down the stairs. I've told both tenants I like them both and if they have issues to please work it out between themselves. If they need me to be present, I've offered to be there to talk it through.

@Logan Zanki - You should probably check your lease to see how rent increases are handled. In my lease, I specifically state that I need to give the tenants 60 days notice before the increase takes effect.

I inherited some residents from a previous landlord. The previous landlord never increased the rent over a five year period. The unit was rented approximately 30% below market when I purchased the duplex. I immediately wrote a letter explaining the change in terms and the fact that the residents would have to sign a new lease. I met with them, introduced myself and handed them the paperwork and scheduled a time to come back and review the lease agreement and any changes.

They did grumble about it, but even before they signed the new lease (with the new rate), they had sent a check in for their rent at the new rate.

As difficult as it may be to go to family and friends, I bit the bullet and approached both family and friends (to varying degrees of success) and asked for money for the down payment. Quite honestly, I casually studied REI for about three years and seriously studied REI for one year prior to meeting with family and friends. Through that time, I developed estimation templates and financial projection spread sheets. When I was ready to ask for money, I wrote out what terms I would like on a loan and developed a monthly loan statement. I located three potential fix-and-holds I could purchase for $20,000 cash (including improvements). I went to my potential lenders, laid out my investment, why their money would be safe, how it would be paid back and what would happen if it didn't get paid back.

Another strategy would be owner financing. I've put in a couple offers with owner financing. No luck yet, but I'm still trying.