All Forum Posts by: Stephen Jeffers

@Allyson Edwards as a precious property manager you PM should be advising you on what to do to move forward. If they aren’t they aren’t an asset to you, they should be very proactive in getting your place rented. Other than price as many have said it could be your PM. I know you think they are doing their job, but I’d verify. I’d try calling from another number or have someone call and get a feel on how respond above and how they are selling the property. Trust but verify.

@Caleb Anderson definitely would appreciate that and YES, NOT be paralyzed.

Give Edwin at Triple E Property Management a call.  www.3epropertymgt.com

I'd recommend Triple E Property Management, www.3epropertymgt.com , I worked with them as a PM for over 6 years.  Currently I'm not working as a PM, but I know that their company overall does a great job of managing the property and securing quality tenants.  In addition, when things do go awry their agents and staff are there to be on top of the issues and resolve them.

Call Edwin at 317 281 92 81, tell him Stephen sent you.  If you have any questions feel free to PM me.

Nice, @Gloria Sheridan thanks for the recap.  Did you save the money for the 25% down payment?  Or roll from other investments?

Originally posted by @Matthew Fullam:

Thanks to everyone that has offered their opinion! There are obviously mixed views on how to handle this and I appreciate everyone taking the time to share.  I think I know what I have to do next and will be sure to share the outcome! Just for the record, AirBnB is CURRENTLY allowed in my building (this may change February 12th, 2018), my neighbors have never complained, his reviews are great (clean/responsive), and he pays rent before the 1st of every month. Negatives; hes in breach of contract as my lease states no subletting, I have no idea if he has the proper insurance, he's outright lying to me, hes making more money on MY investment than I am (assumption). Stay tuned!

 I'd agree with many here, quick and short he's profiting at your liability.  You're the owner of the property and have liability I'd imagine even if he has insurance.  You have the leverage, he is in breach of the lease.  Unless you don't want to do the same thing he is doing with regard to AirBnB then he's done the market research and verified its possibility.  You can offer him the opportunity to still do what he is doing with an increased lease, or remove the middle man and do it yourself assuming you plan to do the required work.  You may actually find that his pay is based up managing the AirBnb and there is a small margin.  In that case would it even be worth it to remove him and attempt to do it or just break the lease and get an actual normal tenant.  If you can see the rates, approximate what he's making, remove expenses for cleaning and understand his net profit you can make a push for some of it.

@Jason Bilbrey I did Property Management for about 6 years, our policy probably was a bit proactive to situations like this.  We did quarterly walkthroughs.  During these walkthroughs we determined items that are in disrepair and fixed them.  No questions.  Now after they were repaired if the cause of the disrepair was the tenant they were charged.  Depending on the tenant and the issue we would let it be paid over the course of the lease.  To back up a bit, all of this is defined clearly in the lease.  That is the starting point, what the tenant agrees to with regard to these things as long as they are not unlawful is where to begin.  I would say being more proactive, whether it is stating the house must stay in a 'habitable' condition, or with regards to walkthroughs and repairs is mandatory.

Now as far as moving forward, I'd agree that you would likely want to keep the tenant, BUT and a big but you start to advise them that some changes with regard to the cleanliness and repairs of the property are coming.  I'd start slowly introducing the idea, and perhaps shape it as beneficial to them as well.  They grey area becomes after 5 years how much is normal house repairs vs tenant caused issues.  This could be a sticking point if you try and put it all on them and they push back, if their repairs exceed the deposit does your lease speak toward litigation for damages, are you prepared to go to court?

In summary

1. Review your lease agreement to counter these situations and be more proactive

2. Consider walkthroughs and repairs immediately

3. Introduce idea and see how the tenant responds to repairs they caused being paid of remaining lease, or potentially carried into new lease.

@Phyllis Jones I guess I'm not familiar with the reasons to not purchase a house that has tenants? I would imagine if you are going to buy you should be able to ask for the rent roll and copy of the lease. If those things look good, then its already cash flowing why not? Of course I'd definitely recommend thoroughly vetting your PM company as you'd be relying on them heavily. So understand their reputation, processes, etc and become comfortable with that. As a first property and to get the feel I would think a SFH is a conservative and normal approach, it doesn't have the potential cash flow of a MFH but also with that potential comes more risk, more costs and multiple tenants to juggle. Depends on your strategy and if its just to get your foot in the door SFH could be the way.

@Christopher Boyle hmmm interesting points. Actually wasn’t quite sure what direction you were taking this conversation from the topic. Lol. When I was married I financed solely due to the fact my ex income was 1099 and her first year. When they verified income as Instill owned my first home, they required 6 month reserve for each home, the bank account was treated as mine with both our names on it. My 401k which was counted toward reserves was mine only and not hers. That’s to say things that overlap I’m not sure they would have a problem counting both ways like bank accounts, so you kinda get an advantage. My experience, eager to see others take.

Welcome @Anthony Talarico Jr. What types of property investing did your professor say he was part of? There are many facets to Real Estate Investing hope this site can be a catalyst for you!