All Forum Posts by: Bob Collett

@David Dachtera Of course we have insurance... but I will probably not make a claim. This owner has 7 properties insured with Foremost.  If we make a $2500 claim on a vacant property, it might be declined (or at lease raise a bunch of questions) and the premiums would be at risk to go up if we are lucky enough not to have the policies cancelled. But you are right to think insurance. I will probably at least ask my agent what would happen if we did make a claim.

@Jad Boudiab I will document the installation of the alarm system for those who might be interested.  I ordered it on Friday... got word today that it is ready to ship.

I go where my clients have properties. Unfortunately with this property I "inherited" a slow-paying tenant, an eviction where the tenant waited until the last minute to move out, followed by the realization that the property was a drug house, 40 man hours of cleanup... then the two break-ins.  Way too expensive for the owner... and no fun for me.

Lessons learned... the criminal background check aspect of tenant screening is of vital importance, as is mandatory inspections... If tenant is not paying, pull the trigger fast.

About a month ago, there was a break-in at a property I manage in Cleveland Heights near the East Cleveland border. The owner was interested in selling the property, so he gave the listing to a real estate agent. The agent placed a yard sign, and the break-in happened within a day or so.

The thief came in and stole the hot water tank.  I ask my plumber what an 8 year old hot water tank is worth.  He said about $40 for scrap.  They turned off the water and the gas, and did not do too much other damage. All in all, I felt pretty lucky... but I was scratching my head. Why would anyone go through all that trouble, cause me a significant expense, risk getting caught... all for $40.

Three weeks later I found out why.  After I had my plumber install a new tank, they came back in 10 days for the new tank... and this time they also took the rest of the plumbing.  I think it was a rather clever approach. The Cleveland Heights police told me that they get about three of these thefts every day... and even questioned how long I have known my plumber! It seems the thieves work with contractors, by supplying them brand new  hot water tanks real cheap.

Now I am paranoid... I can't put in a new tank for fear that they will come back.... the complete re-plumb is going to cost me about $2200 to $2500.

This business is all about having problems, then solving the problem, then systematizing the solution.  I decided to order a security system from Simplisafe for about $400.  Its portable, and does not need WIFI, only power, so once I get the place repaired and rented, I might move the whole system to my next vacant property.  It seems that our local crooks only attack vacant properties. There are certainly other alarm systems out there, but this one had just been referred to me, it is cheap, portable and no contract... so I think I have nothing to lose... unless it does not work.  

So be warned... if you get a break in at a vacant property and they still an old hot water tank... they are probably baiting you to put in a new one.

Comments welcome.

Cudell is a good rental  neighborhood. Good luck.

just to be sure... how long will you actually live on the 4 plex property as your pricipal residence?

Do you currently own the house you live in now or do you currently rent?

Wow! I see some amazing strings on Bigger Pockets.

This one is right up there.  "Lazy Agent", "only takes 15 minutes to write an offer", "all the agent does is write an offer, it's nothing special", "I only want my agent to write at least 2 offers per week (that are not going anywhere)"

Melind, if you embrace these attitudes; you will have trouble finding a successful, professional agent that knows their way around investment property who is willing to work for you long term.  If he is any good, you will not have to fire him... he will fire you.

Let's say your lazy agent gives you 1 hour of driving time, 30 minutes to an hour to view the home and do a proper assessment, an hour to write the offer. (Nothing takes 15 minutes) Various back end phone calls with the listing agent to get the back story, calls to zoning, building department and a contractor or 2 to get briefed on issues discovered at the showing. Time to give the buyer a professional assessment of the what is needed for the rehab based upon best use, and a cost projection that comes in at plus or minus 10% of the probable costs. A proper market analysis. A professional opinion of what it will take to get the deal done... so figure about three to four hours (probably more) 3 times per week, a bunch of additional back office time, and the benifit of her years of expertise learned in the buying and selling of a couple hundred houses including some of their own flips and rental properties.

So, you want this "lazy" agent for whom you have no rspect to put in 50 to 60 hours of time for you over a span of a couple of months... probably much than that. (Be sure to tell him that you have 2 or 3 other agents working for you and you will be happy to give the business to whomever brings you the deal first)

To answer your question, $300,000 on a $335,000 listing is generally reasonable, unless the local market dictates otherwise. 

By the way, where did you get the idea that you are expected to write an offer first, and only later see the property? 

@Johnny Youssef... I have found the accounting and reports included with Buildium to be accurate and useful; and more than enough for any accounting purpose.  I do wish that I could create custom reports as with a "report writer" function... but that is not a feature. Their report package probably has more than 50 reports in a variety of categories. I like it because it is simple to use.

I would suggest you call them... and a few others and ask for a demo. You need to determine what type of user you are going to be. I prefer ease of use vs. availability of every possible feature. 

I am glad you jumped in with a couple of other areas because I think success in one neighborhood gives people both a confindence and a blueprint.

I focused this post on Slavic Village because I know property owners there and saw the steep decline. Now, I hope to witness it's rebirth, which may be happening in real time.

I am going to pick up a few property management contracts here to get first hand experience. I love that no matter whether I drive east or west or downtown, I am always passing by Slavic Village.

I have a contractor on my property management team who can do everything up to a complete rehab. He has a good eye, and can do high end rehabs as well as ready-to-rent projects. He only works one or two projects at a time, and is somewhat selective about who he works with, what kind of projects he takes on and what geographical area. 

FYI... he has the same last name as me.