All Forum Posts by: Sarah D.

Thanks for the advice!  The lease is with the tenant only, but the roommate was an approved additional occupant.  I foolishly didn't have them sign anything, just told them that the roommate's application was approved.  Our tenant is working on getting the roommate to move out at the same time.  I'm just preparing, in case.

Even if the roommate is technically a 'squatter' he would still have tenants rights under CA law, I believe.  I think a consult with an eviction attorney might make sense, if for no other reason than to further educate myself.

Our tenant informed us he has to move out due to deployment.  He will be moving out at the end of September.  A month into his lease he added a roommate.  This roommate could not have qualified on his own, has not paid the primary tenant any rent in months (per the tenant, we've gotten all the expected rent), and now is not responding to the tenant.  

I'm hoping for the best but planning now for the situation where the tenant moves out but the roommate does not.  My plan at this point:

1. Check in with our tenant every 2 weeks to get updates on his roommate's plans.
2. If the roommate stays and does not pay October rent hand him a 3 day pay or quit ASAP.  Offer $500 for moving expenses if he is out in 3 days, to be paid once he is out.  
3. Get started with the eviction attorney when we hand over the 3 day notice.
4. File for eviction at the end of 3 days.
5. Learn from this- Never allow a roommate to be added that cannot qualify on their own and seems to have demonstrated a pattern of irresponsible financial behavior.

I have a couple of questions:

1. Is there anything different/unique about evicting one roommate after the other moves out?
2. We will be holding the deposit until the unit is vacant.  My understanding is that the deposit covers the unit, and can legally be used to cover unpaid rent and eviction costs.  Can anyone confirm this is correct?

Anything else I should be doing now or be aware of?  This will be our first eviction.  To add to the fun we live on site!  Which will hopefully be motivation to the roommate to move out with the tenant in order to avoid my scornful glances ;)

@Alice K. I'm with you!  Those pangs of envy hit me every once in a while, and I just want to sell our investments and buy a nice house for our family.  But then I remember that the price is more than $1M, its also 30+ years of life working for money to afford it.  

@Steve Vaughan I love your labor camp line!  It's so true when owning your home requires decades of mandatory labor for others.

I'd be concerned about liability over damaged electronics from your original wiring comment.  I'd leave that out, or change the wording to something along the lines of using surge protectors for sensitive electronic equipment.

I would feel the same way, but I wouldn't tell you that for legal reasons.  I'd just wait for the more qualified tenants.  I'd agree with just trying big corporate complexes as they'd be the least likely to care about your personal situation and go only by numerical acceptance criteria.

We paid $1800 for a four unit, two separate structures (Nix Termite).  But that was in November; prices seem really high right now, presumably because it's swarming season and there's more work than workers.

Less than a year they need 30 days notice to vacate; more than a year they need 60 days notice.  The notice has to be hand delivered or sent via certified mail.  You do not need to state any reason.  This assumes there isn't any rent control; if there is please disregard my thoughts.

@Hank Wu As a new investor I feel you!  We've been at this for 6 months and last month was the first month I didn't have to ward off panic about whether we would get rent.  Repairs are no longer stressful either, and I'm much more comfortable with tenant communication.

I agree with @Dan H.; develop a team of reliable vendors so you always have a go to person when problems arise.  Also, if you renovated the properties right before renting them it's not too surprising to have little things break here and there as they haven't been truly tested by a previous user.  

Last thoughts- have you written down all of the risks you see and analyzed them for probability of occurrence, severity of occurrence, and ways to mitigate the risk?  If not I'd suggest it.  Having all of your concerns written down, analyzed, and planned for allows you to feel confident you can tackle those issues as they arise.

@Peter Talbot Here are my thoughts:

1. In my opinion you will need more cash to invest in San Diego. Yes, FHA is possible but there are self sufficiency requirements that dictate your ability to use 3.5% down. Talk to a lender to help figure out what you can qualify for and how much you need to save up. This will help you make the decision.

2. If you can work remotely, are you willing to move for a little while in order to invest elsewhere?  I know people do it fully remotely, but that generally means turnkey which comes with a hefty price tag.  And you will still need to travel to meet with companies, learn the area, etc.  As a new investor myself I can't imagine how people jump right in and do everything successfully from a remote location; there is definitely a learning curve, which is much more steep if you can't be on site.

3. Have you considered buying a house and renting out the rooms rather than purchasing a 2-4 unit property?  

Consider your long term goals as well, and whether OOS investing gets you closer to those goals.  Best of luck!

@Kailee Tedesco I agree with everyone who states that cash flow is tough in SoCal.  But it's also tough to learn a business from 1000+ miles away.  From what I've seen the people who invest out of state with great success either:

1. Invest in the area they grew up in, so they have a strong familiarity with neighborhoods, trends, and possibly have family in the area to help

2. Invest out of state with a partner in the area (a turn key company is not a partner).

3. Move to the area they want to invest in, get their business rolling, then move back. (@Cody L. isn't this what you did?)

4. Have already learned the ropes locally so they have a strong foundation in RE for remote investing.

Everyone says it, but house hacking a 2-4 unit is the best way to start.