All Forum Posts by: James Park

For those of you who have taken in tenants with a prior eviction record. What has your experience been like?

I have two of my personal higher end rental properties listed for lease for $1850/month.  I encountered a unique situation where the credit score came out as 790 but there was a recent eviction record that took place just two years ago. I asked the prospective tenant if he had any knowledge of this eviction record and at first replied, "no". This reply automatically made me feel more cautious. Then I went more into detail about the eviction finding that I had found on mysmartmove.com and he started to explain to me the situation about the landlord not taking care of the mold issue making the home inhabitable.  I met both him and his wife and they both seemed so genuine and kind people. Income was good as well as the cash reserves. I was about to accept them until my wife told me that she didn't feel good about the eviction record being so recent. I don't I ever remember listening to my wife and making a bad decision. I immediately called the prospective tenant to let him know that I will have to deny his application, he did mentioned to me that he felt that the credit score on mysmartmove was highly inflated from what his real credit score is.

Similar situation with another applicant with an eviction record five years ago shows a credit score of 780. How is it possible to have an eviction record in the past 2-5 years and still have a 780 and 790 credit score? How do you guys feel about taking in a tenant with a 780 credit score with a recent eviction record that happened two years ago? Tenant selection is something I take very very seriously for myself as well as for my clients.

I turned both of them down (780 and 790 credit scores), and I am hoping that I made the right decision. What other methods are there to pull credits that are more credible? I have been using MySmartMove.com for the last 4 years and now sort questioning the intergrity of the credit pull.

@Alan Reza

@Alan Reza,

 The southern California is much more cyclical than the Atlanta metro market. I do believe the median home price vs the median income ratio is stretched quite a bit in Orange County. I do see a short term 10-15% correction in the short term horizon (2017-2018) for the Orange County market, but nothing like down turn from 2006 - 2009. You can see the appreciation data for Orange County is very similar to that of the Atlanta market between 2012 - 2015. 

To go from a 1800 sq/ft 3 bedroom "Detached Condo" without a drive way to an 3bedroom "SFR"
with a driveway in Irvine is almost cracking the one million price point. I actually helped one family relocate from Orange County to Johns Creek last year and currently working with another new relocation family from Irvine. He senses that a correction is coming in his market and selling his 3 bedroom townhome in Irvine which he purchase in 2010 to exchange his property for a nicer 3500 sq/ft+ SFR in the Johns Creek area. Most importantly, it is a financial decision for him to relocate his family to the Atlanta market with lower cost of living.

From the chart above you can also see a strong correlation between the LA/OC unemployment number and housing prices. The S&P just touched 2100 again last week. If we have a significant correction in the S&P breaking below 1600 (25% or more drop), I would think that correction in OC housing market will be directly impacted at a faster velocity.

Hope this information helps.

@Chad Batten,

It seems like North Atlanta is right in your backyard and definitely worth targeting, especially for buy and hold.

Bump. Anybody?

I am looking to get my Florida broker's license. I wanted to ask the Florida real estate agents and brokers on how they are doing about their CE credits. Is there a good company you can recommend? 

Thanks.

Tom, what does the inventory look like where you at?

Are you experiencing a major shortage of inventory in north Decatur? What has been the appreciation in north Decatur in the last 12 months?

@Maxwell Hunter

Howdy neighbor, do you live in Forsyth part of Suwanee or the Gwinnett side.?

As you can see that D-ratio in metro Atlanta ranges from 0.21 - 2.0. The lower the D-ratio the scarcer the inventory and vice versa.  Therefore the average D-ratio is .51 in metro Atlanta market.

From simple concept of Econ 101, one can argument or predict that there is a greater chance for a higher that average appreciation in the areas with zip codes with the lowest D-ratio and vice versa.

Hope this makes sense.