All Forum Posts by: Drew Sygit

@Remington Lyman understand, just messing with you Columbus guys:)

Seriously though, would like to chat about what you're seeing, but DM me!

@Cooper Cheon one of the biggest challenges, if not the biggest(!), when investing OOS is understanding the marketplace.

Here's some helpful advice hundreds of investors have used to avoid making critical mistakes:

Your BiggerPockets Inquiry to Logical Property Management & Realty

<name>, thanks for your interest in our services!

Be sure to check out our website www.LogicalPM.com to explore our many services and more importantly, HOW we provide those services.

Highly recommend spending time on our exclusive interactive Map of Metro Detroit Cities (132) & Detroit Neighborhoods (183), with color-coded Classes (and more to come)!

Use our map to better understand your investment options in the Metro Detroit market, so you can match these options with your expectations.

Take a peek at our award winning blog too!

To move forward, please schedule some time on my calendar to chat more:

https://calendar.app.google/yW5dDJWmiKuQCCS87

We're looking forward to assisting you on your real estate journey!

Here's some other info to keep in mind:

TYPES OF RENTAL INVESTMENTS

Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.

Why is Property Class so important for investors to understand and apply in their investing strategies?

Because the Property Class dictates the Class of the tenant pool that the property will attract.

The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.

Both Property Class and Tenant Class affect what type of contractors, handymen and property management companies will work on a property.

If you buy & renovate a property in Class D area to Class A standards, what Tenant Class will rent it?

Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?

So, if you fail to apply the correct assumptions to a property, your expectations won’t be met and it may even be a financial disaster.

We use the following to rank Property Classes, in order of importance:

• Property Tenant Pool: closely linked to location, but not always.
• Property Location: closely linked to tenant pool, but not always.
• Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”

Key metrics for each Property Class:

Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.

Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.

Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.

Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.

Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.

Where did we get our FICO credit score information from?

Check out this chart:

Source: Fair Isaac Company

Make sure you understand the Class of properties you are looking at and the corresponding results to expect.

Metro Detroit has 132 cities, the City of Detroit 183 Neighborhoods, which we’re analyzing and classifying. Check out the map on our website where we’ve made this all easy to follow.

We can also share numerous examples of properties & portfolios we’ve assisted investors with!

DM us if you’d like to discuss this logical approach in greater detail!

Your BiggerPockets Inquiry to Logical Property Management & Realty

<name>, thanks for your interest in our services!

Be sure to check out our website www.LogicalPM.com to explore our many services and more importantly, HOW we provide those services.

Highly recommend spending time on our exclusive interactive Map of Metro Detroit Cities (132) & Detroit Neighborhoods (183), with color-coded Classes (and more to come)!

Use our map to better understand your investment options in the Metro Detroit market, so you can match these options with your expectations.

Take a peek at our award winning blog too!

To move forward, please schedule some time on my calendar to chat more:

https://calendar.app.google/yW5dDJWmiKuQCCS87

We're looking forward to assisting you on your real estate journey!

Here's some other info to keep in mind:

TYPES OF RENTAL INVESTMENTS

Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.

Why is Property Class so important for investors to understand and apply in their investing strategies?

Because the Property Class dictates the Class of the tenant pool that the property will attract.

The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.

Both Property Class and Tenant Class affect what type of contractors, handymen and property management companies will work on a property.

If you buy & renovate a property in Class D area to Class A standards, what Tenant Class will rent it?

Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?

So, if you fail to apply the correct assumptions to a property, your expectations won’t be met and it may even be a financial disaster.

We use the following to rank Property Classes, in order of importance:

• Property Tenant Pool: closely linked to location, but not always.
• Property Location: closely linked to tenant pool, but not always.
• Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”

Key metrics for each Property Class:

Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.

Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.

Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.

Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.

Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.

Where did we get our FICO credit score information from?

Check out this chart:

Source: Fair Isaac Company

Make sure you understand the Class of properties you are looking at and the corresponding results to expect.

Metro Detroit has 132 cities, the City of Detroit 183 Neighborhoods, which we’re analyzing and classifying. Check out the map on our website where we’ve made this all easy to follow.

We can also share numerous examples of properties & portfolios we’ve assisted investors with!

DM us if you’d like to discuss this logical approach in greater detail!

@Ken Daly recommend you chat with @Jaycee Greene and how he can help increase your portfolio holdings!

Why are Columbus prices falling?

https://www.gobankingrates.com/investing/real-estate/housing-markets-where-prices-falling-ahead-of-spring-selling-season/

@Denis Ponder thanks Denis!

@Lori Edelman you're entitled to your opinion, but you're arrogancy is humorous.

Please tell us all what exactly I wrote that was NOT honest & transparent?

Thanks @Jaycee Greene!

@Burlitta Givens DM us:)

Why aren't you using Zillow?

Often, rent-by-room is furnished, so try Furnishd Finders.

@Lori Edelman ugh, why did you do that?

Now you have to tell EVERY tenant about what you found!

What you've really done is put a bullseye on yourself for a tenant to file a lead-based poisoning case against you:(

Or, they will use the info as an excuse to not pay rent or break their lease.

AND IT'S ALREADY HAPPENING with the current tenants:(

They are only making it an issue on the lease renewal because you told them (which you are now required to do).

Confused about why you think previous PMC is responsible for exterior of windows not being encapsulated. 

You wrote, "I conducted a lead test which showed that some window frame paint samples inside the house had lead paint".

You did the test, it was up to you to determine how & what needed to be addressed. Property Management Companies are NOT Asset Managers!

Have you complied with Saginaw's rental inspection requirements?
https://www.saginaw-mi.com/168/Building-and-Code-Enforcement

If so, the tenant has little grounds to demand anything as the city inspector would flag any issues.

@Faviola Paz how are you going to do showings?

Perhaps hire an agent to help you place tenants, but you screen(!)?