All Forum Posts by: Mark Douglas

@Andrew Johnson From what I gather, the $75 everything but labor on repair calls.  We didn't go line by line of their expenses (this was just the initial phone call, to gauge their professionalism and knowledge) but it was fairly inclusive.  He mentioned that the tenant class would generally be Section 8 renters.  They have managed this tenant class for awhile, according to him.  

They are definitely the most expensive I've talked to so far.

With their 17%, each unit would cash flow between $106 - $180 (he gave me a rent range on 2bd....I'm getting actual rent roll from seller after I sign the contract) which is low to me.  

Using a typical 10% PM would do a little better, I just don't want to sacrifice quality of service

@Meghan McCallum Interesting, I will add this to my questionnaire, thanks

Interviewed a PM company.  $75/door/mo flat fee.  I'm evaluating an 8 unit, which would cost me $600/mo.   No other extra charges (re-lease, etc.) but this certainly eats into my CF.  They seem EXTREMELY thorough - Monthly reports by the 5th, 5 full-time maintenance staff, manage 300 units (too many??)

Still calling others in the area.  

Thoughts?

@Michael Evans  Is this only on SFRs?

@Dustin Schaefer You may consider calling a few commercial brokers and ask what the going cap rates are near that apartment, to hone in on your baseline valuation.  Also, you could call a few PM companies to verify which areas they service.  Hope this helps !

Just looking for some motivation to keep me moving forward :)

GO!

@Matt W. thanks Matt!

@David Faulkner I see where you're coming from.  Do you trust the referrals that they give you??  Wouldn't the PM give their best customers/owners as referrals? It seems like there would be a few properties that could fall through the cracks if they're managing hundreds of units, no?

I have a couple of units here in town, and I'm working on some more.  I'm not saying there aren't any opportunities here, just keeping my options open :)

@Mark A. My two cents, if the property is in what sounds like an A area, there are likely A/B+ tenants that can pay you just as easily.  It is nice to get a lump sum upfront, but your peace of mind is priceless.  If you're comfortable with them paying 8 months upfront, go for it.  Personally, I would try and evaluate the rest of the applicants, and choose the most likely to be consistent, with regards to job stability and financial independence.  As others have mentioned, credit scores aren't end all be all's, but they do measure the patterns of one's payment history..... 

@Kyle Nelson I can take 1/3 of these questions lol.  The appraisal will be part of the loan underwriting process.  The appraiser will include a rental analysis of the market rent; this will likely be lower than what you can probably rent for, in my experience.  

On the banks that will count 75% of the rent as your income - I haven't tried this on a vacant property, but I know most local/community banks will be able to count this when you're in the property for a certain time...usually 6 months to one year.  Not much help upfront, but it'll be helpful once you're up and running.