All Forum Posts by: Payton Haight

Hi Nicholas, When you hear grades for properties, investors are usually referring to the neighborhood rather than the house itself. The grading system is subjective and unique for each market. As you mentioned in your post, A class B property to one investor might viewed as a class C property to another investor based on their own subjective criteria. 

In general, 'class A' neighborhoods are the most desirable areas - commonly associated characteristics are: homes in great condition, low crime, and a good choice of nearby amenities. Class D would essentially be the opposite of that. Class B and C would then be some mix between those. 

From your post, it sounds like you are trying to grade the condition of actual properties themselves rather than the neighborhood/location. Is that correct? If so, I am curious why are you looking to assign grades to the properties? Is it for tracking in an Excel file or something similar? I suppose you could establish criteria for a grading system for houses. Something like class A properties are in perfect condition and need no work. Class D properties would be a full gut, etc.

@Jake Burkons - nice! You are crushing it. Let me know if you are ever looking at anything around the Columbus / central Ohio area or just have questions in general. The majority of my investment experience is with single family and small multi-family LTR's and MTR's. Glad to talk even if you aren't planning to buy or sell with me. 

Hi Nathan, welcome to BP! Awesome you are getting in to real estate at 24 - that could be a huge advantage for you. I am originally from the central Illinois area and own a few properties down in Bloomington. Glad to connect to learn more about you, your goals, and see if I can help/answer any questions. Feel free to reach out!

Hi Gobena, nice to meet you. I live in Columbus, OH now, but I have a few properties in Bloomington, IL. I am originally from the central Illinois area and Bloomington has been a great market.  Glad to connect to learn more about you, your goals, and see if I can help. Feel free to reach out!

@Bonnie Glidewell, for my mid-term leases I am typically able to get roughly 2x the long-term rent for my units. For example, a unit that would rent at $1k/month as an LTR rents at $2k/month as an MTR. The amount of rent you can charge will be dependent on your market and strategy. Lots of strategies - renting to traveling professionals, insurance relocations, etc.

There are additional expenses associated with running an MTR that you will need to factor in. You will likely need to furnish the unit/house and then you will be responsible for paying all utilities, internet, streaming services, toiletries, lawncare, snow removal (may not be necessary but I provide it for my traveling professionals). MTR's can be more 'work' as you will likely have higher tenant turnover and guests have higher expectations. 

My properties are located near several hospitals and a university and are marketed towards traveling professionals through FurnishedFinder (90% of my bookings are through FurnishedFinder) and Airbnb. I am typically hosting healthcare workers, university employees, and utility workers in town for a contract. I have been fortunate to have an average stay of a little over 6 months so am averaging roughly 2 turnovers per year instead of 1. 

Make sure to do your due diligence if you are planning on going the MTR route to ensure there is a market for it in your area. Let me know if you have any more questions!

Of course! Bill makes some great points. The plumber that did the work should not have been starting any major repair work without the owner's consent. You can potentially use that as a negotiating point if you find you were overcharged significantly for the work done. 

Hey Dennis, Where are you finding deals? In NY only or out of state as well? If you are getting enough leads, the 'easiest' option may be to get your real estate license. Not sure NY (or other states you may be working in), but in Ohio brokers/Realtors cannot pay a commission to unlicensed individuals. Perhaps someone else has a legal way of setting this up so you can be compensated for providing good leads.

hey Joshua! That is a tough situation. Sorry to hear about that. From my understanding, your tenant had all of this work completed without you or your property manager's consent, correct? Do you have anything in your leases about how repair issues should be handled? 

A gas leak can be a major emergency so it seems reasonable the tenant called the gas company immediately to shut off the gas. Past that, I would have expected the tenant to call your PM and have them handle all of the repairs. I am assuming the work that was done was necessary so you would have been paying for SOME amount of repairs to get this issue fixed no matter what.

If you have a detailed summary of the work that was completed and your lease indicates that the tenant should not be handling repairs themselves, you could get the work quoted by 1 or 2 other plumbers. If the quote from the other plumbers is significantly lower, then perhaps you charge your tenant for the difference. OR maybe use this issue as a teaching moment for the tenant and your property management company. Just a couple of ideas.. 

Hi Bonnie, welcome to BP! Oregon is beautiful, but I am not familiar with the real estate market there so I am just going to assume it is similar to many of the markets across the US right now. Pure cash flow (the actual cash flow you receive after all of your monthly expenses, including repairs and capex) is difficult to find in desirable areas with an LTR at a 75-80% loan to value (LTV) ratio. You are probably not doing anything wrong - home prices are high and interest rates are relatively high compared to recent years.

A few questions for you (can be rhetorical): What are your goals for your real estate portfolio? Do you need the cash flow or are you looking for long-term appreciation of the properties? Depending on your goals, perhaps you can look at alternate strategies such as short-term rentals, mid-term rentals, rent by the room, etc. Whatever might make sense (and is legal) in your area. An obvious one but worth mentioning, you can also put more money down to help your deals cash flow.

Personally, I have pivoted to mid-term rentals to help create cash flow for properties that would not have cash flowed as an LTR. Feel free to ask any other questions or reach out directly. Glad to help if I can!

that is awesome - congratulations @Jake Burkons! Have you been able to get the property rented back out and do you plan to do a cash-out refi?  Curious what the numbers look like after your rehab.