All Forum Posts by: Mike F.

Originally posted by @Will Barnett:

  I'm talking about being able to afford rising home prices. 

Wages versus home ownership affordability does not mean wages are stagnant, it means that homes are appreciating faster than wages, that's typically localized. It's been that way in San Franciso forever.

What’s Behind January’s Higher Wage Growth

Education? You lost me again. Experience might be a better definition of some of the problem, not education, we've got all the highly educated nonsense graduates we need. Skilled manufacturing, skilled construction has huge gaps, almost all of which is OJT and experience learning, not much of it is taught to students in universities. The last recession drained a lot of these workers out of the system, through attrition, retirement and switching job paths to other careers. The devastation was so huge in some of these sectors that recovery of workers hasn't taken place yet and we are now in the middle of the process of refilling the ranks. Apprenticeship programs, job mentoring etc... is all on the rise as employers seek desperately to figure out how to get bodies up and running to fill positions to allow them to keep up and expand. Logic can't follow your hypothesis that lack of skilled workers due to education or anything else would lead to wage stagnation. Think logically for a moment and question the BS put out by the media you are attracted to. The basic economic theories of supply and demand do not allow for your beliefs to exist. Do a simple google search for phrases such as "the myth of wage stagnation" and start reading the truth. Reality cannot support this stuff put out by liberals about wage stagnation, just think about it. 5% unemployment... 6 million job openings, employers desperate for workers... none of that supports a theory of wage stagnation. Just open you mind a bit

No employees in realestate.

The national unemployment rate is about 5.0% The only people experiencing stagnant wages anywhere in the US right now in their jobs are people that deserve to.  Look around you, if every employer is doing all they can to retain their good employees and your employer could careless about you, you're probably earning more than you deserve.  Look around at employment ads count the ones that are offering sign on bonuses. Employers are trying to steal employees from their competitors, there is article after article about companies not being able to fill their job openings. 

There are almost 6 million unfilled job openings in the USA right now, that's the highest number since 2000 - that's 16 years ago. Anybody complaining about stagnant wage growth only needs to go to their employer and ask the simple question "what could I do more for you to be more valuable and earn a higher wage?" after their employer gets back off the floor they will hug that employee and immediately tell them what they can do, it will be as always up to the employee to follow through and earn that higher wage, reality will be 9 out of 10 simply won't do what it takes but will ***** instead about it.

I don't know anything about stagnant wages, here in Denver I'm an employer and I'm paying wages that are higher than the skills workers possess.  We are under 5% unemployment. Realistically it's not hard to understand that in a super tight labor market anybody unemployed is probably a complete douche bag. Companies in a tight market don't let go their good workers, anybody unemployed likely has issues that made them the weakest link in their former job and were the culled from the herd because of it. As an employer when you need to hire somebody in a sub 5% unemployment rate the majority of your choices are people you wouldn't even consider as a candidate in a more typical labor pool. As a result employers are holding onto their good employees with both hands and that equates to compensation. So stagnant wages... BS.

Originally posted by @Account Closed:

I realize we all say "people need somewhere to live" but if you have a quad and you lose 3/4 of your renters due to job loss in a recession, where are you now financially.  Does anyone else worry about this downside risk?

First I would really want to know what kind of conditions could cause you to lose 75% of your renters? Where are they going to go? How have you set up your rental business that you have such a unique exposure to loss?

Secondly, though it goes against the grain of the typical investor mindset of many real estate investors, I recommend reconsidering your investment strategies in regard to the lack of equity in your properties. Those who only are concerned with cash flow often are the ones who end up as you're worried about in a down turn, this alone should be enough to show the flaws in that thinking, as your investments must be sound in both the up cycle and the down cycle, if not you've really expanded too quickly and your investments are a house of cards.

Tear out the backer with the tile, don't replace with cement board, cement board is from 1985, it's 2016, install a waterproof backer such as DensShield. Tile and grout is  not waterproof, cement board was an improvement over green board as it doesn't rot like green board did, but it's water permeable, when the water gets through the tile and grout the tile doesn't rot off but the water gets into the framing and insulation behind it and allows mold to grow. 2016 we install water proof tile backers now like DensShield, which is even easier to install than CBU (cement board).

Large security deposits save you from almost all bad tenants

"The oil and gas sector has been hammered hard which will cause tremendous damage to the banks."

Wrong.

"Automotive indicators show a consumer that is weakening, with auto buyers having to extend terms of finance to 84 months for consumers to afford a car."

Again, this isn't a recent event

"Talk to the everyday American consumer and you will find out they are strapped.

Since when have they not been?????

"Home ownership is at the lowest levels in fifty years.:

Has nothing to do with recent economic events what-so-ever, we didn't suddenly arrive at this in the last 2 quarters

That's as far as I could get through his article before it became just to mind numbing.

Let's keep perspective on the issues in the discussion -If you want to give tenants little welcoming gifts because it makes you feel good, like you're a good host to your 'guest' go for it.  This is a personal decision not a business decision.

If you want to give tenants gifts to bank good-will... well you'll be taught a rude lesson sooner or later and be dejected when you discover that being a landlord can really be just about how your lease stands up in court eviction.  Nice gestures on your part are just that, don't be surprised.

If you want to give tenants cleaning gifts to remind them to keep the place clean or thinking you're going to effect their cleaning habits... well.... I've already said what I think about that, I won't repeat it as it's apparently too harsh.

Originally posted by @Joe Splitrock:

Originally posted by @Mike F.:

Lighten up Roy, you're making a lot out of nothing.

Your condescending effort to belittle other landlords is not at all in the spirit of BiggerPockets community. It is landlords helping other landlords. Judging by the lack of any up-votes on your posts, it seems your viewpoint is not widely supported. Roy is trying to politely tell you to be respectful of others and accept the fact that there can be multiple correct answers depending on the situation. Roy is a MODERATOR asking you to keep the tone positive. I believe the role of a moderator on a site is to alert people when they are out of line. Telling him to lighten up is just another attempt to belittle.

It strikes me as strange you are so worked up about people giving small welcome gifts. Some topics are controversial and heated debates are understandable, but this is pretty tame. I don't see how me spending $5 on a tenant that is paying $1200 a month in rent is so crazy.

Lighten up Joe, you're making a lot out of nothing.

Concentrate on the thread there is a lot of good information from others who have the exact same opinion as I do about gifts to tenants - which is do it if it makes you feel good, but don't think it's a business decision.

Decisions that will effect your rental business are - keep your properties perfect. Respond to tenant requests promptly. Treat your tenants firmly but fairly. Do not use grace periods for rent. Use a written lease. Do everything legally and in compliance with tax laws. Maintain a professional demeanor in your business, not a friendship with your tenants, maintain the superior position in this financial and legal relationship at all times to avoid the entire list of pit falls that befall landlords over and over again. And most importantly screen tenants well so you aren't desperately trying to nullify or change a renters motivations or behaviors from day one through gifts, especially ones related to cleaning and keeping your property clean.

It's not belittling a landlord to give them the harsh truth of a matter, that's education.

Landlords or more likely 'potential ones' who are wrong about human nature and the relationship of gift giving to tenants under the missbelief that it will change a tenant or bank goodwill to keep a tenant on track during the rental period are as wrong about that as they are about all the rest of the things they will do because they don't understand people. These are the same mistakes in reading human beings that lead them to post about "my tenant moved in and he wrote a personal check for the security deposit and it bounced now I can't get him out" or "my tenant's 'boy friend' wants to move in to the unit, I told him I needed to have him fill out an application and do a credit and back ground check, he said because he is only going to stay there short-term for a few months while he is in the process of buying a house, and doesn't want me to pull his credit because it will make his credit score go down, he seemed like a nice guy, but now he (fill in the blank of the catastrophe)...." 

The same people that put themselves in those situations are the same ones who think gifts are making a difference, it's a problem understanding human beings, human nature and you're living in a world of ivory towers and sooner or later a tenant is going to come along and take advantage of you in a big way. Better to understand the reality now than pay heavily for it later.