All Forum Posts by: Nathan Gesner

If your goal is to "break even" and get an education,  I suspect you're in for a surprise and will get more of an education than you bargained for.

A better way would be to partner with someone. Find a mentor that can show you the ropes in exchange for your labor. You could offer to hunt down deals, handle mailings, run errands, sweep floors, or whatever. If you have what it takes, someone will recognize it and give you the opportunity.

Originally posted by @Matt K.:

Originally posted by @Nathan Gesner:

A military renter will typically stay put for 2-3 years so you get stability. You also won't see a military renter tell you their hours got cut at work and they need to negotiate a reduction in rent. When they leave, another soldier can take their place. If you are a good Landlord and the home is nice, you should have no problems.

If you ever have a problem with your renter, a quick call to the housing office or his/her First Sergeant may fix the problem quickly. It helps to have a military background and know who to talk to and how to talk to them. I've seen businesses that couldn't get money out of a soldier but one well-placed call to someone in their chain of command and the soldier is handing over cash that same day.

Appreciation in military towns may be slower than average but you're probably focused on cash-flow more than resale value so I wouldn't worry about that. I also wouldn't worry about base closures because Bragg is a pretty solid bet.

 That's not entirely true, lot of military members are TERRIBLE with money... So hours might not be cut but (insert something stupid) happened and rent will be late etc....

Or the constant budget issues facing our government also can impact their pay.

Generally speaking you're right though a member has more to lose than the average Joe, but that doesn't make all of them good tenants.

Uh...you still have to screen them. I would never suggest you accept a military applicant simply because they are military. You still run credit/criminal, check references, verify income, etc.

@Jill F. I misunderstood and thought the granddaughter was applying with the grandparents. I now see she was just helping them fill out the application. They meet all your qualifications and sound like the best option so I would approve them immediately.

Some thoughts that come to mind:

1. Who is responsible for common areas inside and outside the house?

2. How do you determine responsibility for damages in common areas?

3. How do you handle disputes over common area use, stealing food from each other, taking out trash, someone that monopolizes the space, etc.?

4. Every tenant needs security for their private room

You may get additional rent but you can also have additional work (dealing with more frequent turnover, common area cleaning/maintenance). Is it worth it?

Every purchase agreement should automatically include an several contingencies that will allow you to back out. I heard a podcast with a BP investor that buys large commercial properties. He writes all-cash offers with $100,000 earnest money without even seeing the property. Why? Because the Seller will see this as a strong offer and accept it over others but the Buyer can walk through the property and change his mind based on the floor plan, condition of the roof, strength of the leases, or a thousand other reasons.

Read your contract. You can typically back out based on things discovered during the property inspection, review of leases and/or financials, appraisal, financing terms, title review, etc.

There's nothing wrong with letting them stay longer since you're getting a great deal, but you still need to protect yourself. I would consider holding any proceeds, or a significant amount of the proceeds, until they deliver possession. If the Seller were getting $10,000 from the sale, you could pay 50% at closing and the remainder when they deliver possession.

What you don't want is for them to stay in the property and require eviction or for them to haul off all the appliances, doors, and cabinets on their way out.

Abide by the agreement. Get a lawn expert to determine what the cost would be to recover the lawn. Pre-pay for the service and charge the tenant. Hire a contractor to remove the security cameras and repair the holes, then charge the tenant. 

Don't make special concessions for a tenant, particularly when you don't know if they are even abiding by the basic lease obligations.

Most utility companies can provide you with averages for the past year. Let's say the average for the entire building, all utilities combined, is $400 a month. It will likely be higher in the winter and lower in the summer but you are concerned about an average because it will balance out at the end of the year.

Take that $400 and split it by number of occupants, square footage, or whatever system you divise.  For example, you could charge $250 for the larger unit and $150 for the smaller unit. Try to make it fair as possible and be able to justify it when the tenants question the charges.

Personally, I bump the charge up 10% because tenants tend to squander utilities when they don't see the bills each month. So the downstairs may pay $275 and upstairs $165.

One thing I definitely don't recommend: receiving the bill each month, calculating the shared charges, and then notifying the tenants of how much they owe. It's a lot of additional work and frustration for all concerned. Better to set a regular budget and include it in the rent.

Make sure you have everything documented. Copy of the lease, copy of their payment history, any emails/texts between you and the tenant, etc. I've been to court dozens of times and there is one common thread: tenants show up with stories and excuses but no documentation.

I think you and the owner are wrong.

When a tenant breaks the lease, they are still obligated to the terms. HOWEVER...the Landlord/PM has a legal obligation to make "every effort" to find a new tenant. Once the new tenant is placed, the former tenant is released from any obligations.

In your case, the tenant is breaking the lease because the owner wants to sell and the Landlord/PM is refusing to make every effort to find a new tenant. I tell owners up front that if they make the decision to list the property for sale and the tenant chooses to leave, the owner cannot hold them to the terms of the lease.

I'm not an attorney but I'd put my money on the tenant for this one.