All Forum Posts by: Nathan Gesner

"Will you accept payments on the security deposit? I can give you $100 a month for six months, maybe even more." We require the first month's rent and deposit in full before you can occupy.

"Why do you need me to fill out an application if my girlfriend is paying the rent? I'm just living there!" Even if you have a sugar momma or sugar daddy, we need to run a background check to ensure you are not a danger to the property or other tenants. You will also have to sign the lease and be held responsible for the care of the home, payment of rent, etc.

"My Landlord will give a bad reference because I reported him for mold." If you didn't prove it in court, I have to consider it a personal dispute.

"I don't have a Landlord reference because I've been sleeping on my friend's couch for the last couple of years." We require a Landlord reference or evidence you were a home owner. Without it, you won't be able to rent unless you meet all our other qualifications and are able to pay a significantly higher deposit.

"Can you lower the rent? I just bought a new motorcycle and can't afford much." Can you live on your motorcycle?

Thanks for sharing the story with us, Chris. Just remember, you are in a rather volatile market that can crash as quickly as it grows. Watch the market closely and be prepared to pull out. I sold a property for $265,000 in 2005 that was sold for $83,000 two years later. It's finally back up to 2005 levels after 10 years. Be smart and keep learning!

$4,000 a month in expenses? You've rented it for five years and are just breaking even?

We are experiencing one of the hottest rental markets in history and you are only breaking even. Others are familiar with the neighborhood and say it's a bad place to invest. You're basically holding onto a really expensive pig hoping the California government will make the right choices and improve the community. Those are some terrible odds.

Dump it and move your money to a more affordable, Landlord friendly state that is on an upswing.

I wouldn't advertise a property that I don't own or control. Get all your ducks lined up and press the button as soon as you close, but not before. You'll be amazed how many sales fall through between the accepted contract and the close date.

You're still missing it. What is the TOTAL cost if management? How much do they charge to place the first tenant and every tenant thereafter? Do they have other fees like marking up maintenance, inspection fees, administrative costs, etc? 

How will they handle marketing? What's their track record on vacancies? How do screen tenants, handle late rent, or evict? Do the keep tenants happy and maintain the properties? Do they provide references? What are their reviews from Tenants? How strong is their lease? Is the management agreement fair and professional?

I am the most expensive property manager by about 3-5%. However, I provide far more services and make my owners far more money even fter paying my fees. Don't choose a manager just based on their fees!

I can see how a hotel would be a good investment but it's interesting that you would choose that path when hotels are so much different than apartment complexes. How did you educate yourself on the hotel industry before taking the leap?

On the surface it sounds like a cash-flowing property but there are too many variables and unknowns. What's the market like? Where is it headed? How does this property perform compared to the market? Did you budget for vacancies, management, major repairs, etc? Can you handle a vacant unit for a month? Two units for a month? What's the condition of the property and projected repairs/upgrades?

Congratulations, Ryan. You have to know the level of risk you are willing to accept. Learn from your mistakes. Then keep pressing on towards the goal!

I'm expecting a correction, but not a crash. It really depends on your market. When the last crash happened, my market only went back 3 - 5%. Demand for rentals increased and rent rates went up so it was a great time for investors. It also resulted in more investment opportunities.

I'm curious to see what will happen because it seems there are a lot of investors out there buying properties that barely cash flow in the hopes they will be able to increase rents in a couple years. A setback of 5% could decimate a lot of portfolios that are over-leveraged.

Everyone has to know their own risk tolerance. If you buy smart, you will survive the ups and downs that occur.

I have no patience for people that "win" by cheating. There are 32 units in the building and the majority of those owners purchased the right to not be inundated with rentals. Do the right thing by respecting their rights and move on.