All Forum Posts by: Mike Dymski

 ouch that may be lower than A class in my market

Captain obvious but make it current (remove wallpaper, new light fixtures, fresh paint (not just white), and wood-look LVP or vinyl sheet in the living room (and kitchen and baths if needed).

I'd recommend find brokers/agents who invest themselves or work with investors.  My agent has been the most important financial professional in my life.

Agreed on the legalities.

Having $0 vacancy is a nice benefit of prepaid in a lease break situation.

I rarely have lease breaks and, when I have, I have not felt the need to attempt to double dip because the breaks were late in the lease, were good tenants and I was able to re-lease the property quickly.  I have frequently reimbursed prior good tenants when I have rented their former unit after they have paid their 30 day notice and moved out early.

IMO, whatever increase get the rent to market is fair and customary.  Market is often a range and you can stay at the lower end of the range if you have good tenants or are concerned about downtime.  You can also provide more notice than required to allow tenants to move if the increase is large and new rent is not in their budget.

@Account Closed thanks for your reply.

I gave a 3.5% discount because he requested it and was very qualified and because I can earn 20% on those funds.

If he breaks the lease, I am whole because I have collected his full obligation under the lease.  Prepaid eliminates lease break issues (although that's not why I accepted it nor looking for that to occur).

Yes they can.  Your property insurance policy will have personal liability protection (with varying amounts of protection at varying premiums).  You can also purchase a commercial umbrella for additional coverage.

 Agreed, my comment on interest rates and property values moving directionally together was due to the excessive level of rate increase mentioned in the post versus minor changes in rates. For borrowing rates to climb to 12% in the next five years, we will be going through massive inflation. 

 It rents fine under a traditional monthly lease payment...has for the past 10 years. The money is mine, there is no contractual need to hold it or contractual obligation to pay interest. The company I work for regularly executes contracts providing pre or post paid terms that are mutually beneficial and are often driven by the parties available capital, cost of funds or earnings rate. I simply traded 3.5% of the rent for immediate access to the capital. I have 30 units and this is the first prepaid proposal I have agreed to; so, this is not a frequent thing. I planned to rent to this guy regardless, I just happen to have the rent up front.

Ball park cap rate for C class in my market in SC is 8.5% and there are value adds available.  How's that stack up to DFW?