All Forum Posts by: Tony Clark

We bought a house out here and it has appreciated very well- about 100k above what we paid. We plan on relocation to CT and we’ve been trying to decide if we should sell or rent our home. The property wouldn’t produce cash flow, but definitely would appreciate well.. how do we decide what to do?

So I have been in this same situation and the way I look at it is this: Assuming you would actually PROFIT 100k (ater closing and taxes if there are any) you have 100k in your pocket to reinvest in something else that could potentially make you more money in a shorter time frame than keeping the home and hoping it appreciates at the same rate it has over the last few years.

So the ball is really in your court as to what you think you can do with 100k (or whatever you end up with after the sale is complete). If you think you could roll that into another investment and make a good ROI (return on investment) than I would recommend selling the house and taking the cash. If you dont think you can roll that money into something else and quickly start profitting from it than it may just be best to hold on to your property and play the long game on it.

Me personally, Id sell it and find something to reinvest that money in. :D Thats just me though.

Good luck!

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Originally posted by @Andrew Freed:

@Tony Clark - Great question and I myself am dealing with the same dilemma, having a 3 unit building way below market rents (I closed on the property in August 2021). The strategy I plan on utilizing once I get through the Winter season is to send a rental increase package explaining why a rent increase is needed, showing comps of current market rents (for instance, using rentometer), and offering a few different options such as a year lease at a reasonable price, a 6 month lease at a higher price, and a month to month at a slightly higher cost. These rents should be somewhere in the middle of market rents and their current rents so the increase isn't unobtainable for your current tenants. DM me and I am happy to send an example of a rental increase package.

Hey Andrew, thanks for the response. This is exactly what I am gonna do. I already have the retometer reports printed and ready to go. I am also going to keep the rents a bit lower than the average in the area so the tenants know that Im not just trying to run them off. I would prefer to keep them. Hopefully the jump in rent doesnt upset them too much but if it does I can get in the units and do a little upograding and get even more. So either way its just something that has to be done.

Also in my state we are required to give 60 days notice. So they will have a good grace period to figure out what they want to do.

1 Vote

Originally posted by @Sam Shueh:

If this is in Manhattan, NY I can understand it. It sounds quite high I am in SFO one of the most expensive rental in the country. Granted you can rent it suggest you try new tenants.

Im basing my numbers off of the current rental market in Olympia WA.

Manhattan is not even in the same ballpark as far as the rental market in Oly. Studios in Manhattan are in the 2 - 4k range..

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Originally posted by @Greg Seivert:

I just listened to a BP podcast where Brandon says to blame it on a higher power. "My accountant is making me raise the rent! The lawyer says I have to!" The tennant is more likely to understand, and you're not the bad guy. Good luck!

This is what I think Im going to do. I have used this exact strategy for other negotiations in my private business and it is usually very effective. Thank you for your input.

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Originally posted by @Jake DeAtley:

@Tony Clark nice pickup at $800k! I was looking pretty closely at that property! I host a local meetup here in Olympia called Multifamily and More - Olympia Chapter. Hit me up if you want to join our private FB group or look us up on meetup(dot)com!
We are meeting at my office this coming Tuesday at 6PM (every 4th Tuesday of the month) and it be happy to chat about a good strategy for this! We usually have 25+ local investors and industry pros come hang out! Good guest speaker as well. Cheers

Ummm YEAH I would totally be interested in this meet up. I will private message you. Thank you for reaching out. :)

1 Vote

Hello everyone.

I am brand new to owning a multi-family property and to this website. I hope I am doing this correctly. :)

So today I closed on my first real estate investment property. It is a 5 unit property that consists of 2 duplex's and a cottage. In all it is 3 units that are 1/bed 1/bath and 2 units that are 2/bed 1/bath. At this time all of the units are rented out and well maintained but they are being rented for well below market value for my area (Olympia WA). I have 3 units that are on month to month leases and 2 units that are leased out through July of 2022.

To give you guys an idea of what Im working with, one of the 1bd 1bath units is being rented for $650 a month and the other 2 are being rented at $850 each, while the 2bd 1baths are both being rented at $1000 each. I have looked at comparable properties in my area and the 1 beds should be more like 1300 - 1400 while the 2beds should be 1500 - 1600.

My question here is how would you guys approach raising the rents on these tenants by such a large margin? I understand that its just business and it comes with the territory of property management, but I am wondering if you guys have any strategies or tips on how to soften the blow.

3 Votes

All Forum Posts by: Tony Clark

Tony Clark has started 1 posts and replied 6 times.

Post: New member- Olympia, wa

Post: New multi-family property owner.

Post: New multi-family property owner.

Post: New multi-family property owner.

Post: New multi-family property owner.

Post: New multi-family property owner.