All Forum Posts by: Ryan Daulton

I don't know Texas laws, but it's likely that the Texas landlord-tenant act provides that a tenant is responsible for damages to the premises. But even if it doesn't (I would be surprised if it doesn't), a lease provision that provides that the tenant is liable for damages caused to the premises should be a legal provision. A few tips here to help minimize damages...

1. Conduct routine inspections, including requesting the tenant to send you self-inspection photos (this needs to be a tenant obligation in the lease agreement though to be able to enforce that obligation). 
2. Look into insurance policies designed to cover tenant intentional damage or gross negligence, as well as unpaid rent. Some policies provide even more coverage than a typical 1-month security deposit amount.
3. As soon as a tenant gets behind on rent, enforce the lease strictly by sending proper notice to pay. 
4. If you discover that a tenant has caused damages to the home during the tenancy, one approach is to deliver a notice to cure the violation, namely, to pay for the repairs during the tenancy, as compared to having to wait until they vacate.
5. Require a higher security deposit. 
6. Require first and last month's rent. 
7. Require tenant to hold a liability policy to include damages caused by tenant. 
8. For risker applicants, require a guarantor (who is not "judgment proof") to agree to pay for damages and unpaid rent.

Unfortunately, you cannot eliminate all risks of loss, so there are times that a tenant may end up causing damage beyond the security or coverage you have to pay for damage, but the above items will help. Best wishes. 

@Ryan Daulton

Great thread! I would advise not listening to family members or friends who aren't RE investors. I stopped sharing my RE news with people who were so negative about my investments. 

Nicholas referenced my very long post. 2023 and 2024 are challenging markets. My performing properties were acquired pre-2013. I closed on 2 homes in 2023 - time will tell if these are good investments. After I re-ran my numbers, I'm thinking no. I don't put my money into CDs since I don't want it locked up for a certain time period. I'd rather use a HYSA. 

Your idea to buy multi-family and live in one of the units is great idea. I would recommend going to local real estate meet ups to talk to other investors. I don't know much about Abilene but San Antonio (looks like a 4 hours away) is a preferred city for a few of my California investor friends - they went in and bought a 52 unit apartment complex together. Good luck!