All Forum Posts by: Travis Lloyd

If you are self managing - remember that these are people you are going to be interacting with quite regularly. Specifically so in the beginning. While all of the key factors (income, job history, credit, etc) are of course the criteria, if you end up in a situation with multiple quality tenants you will have to make a decision. So as you're showing the property - see who you connect with. Its a bit like an odd hybrid between asking someone to prom and a job interview - you don't quite want the person who's TOO friendly, but the odd guy in the corner staring at his phone won't work either.

One other note - bring a friend/partner/spouse someone else with you to meet people. Sometimes we can get wrapped up in a conversation to the point of thinking someone is amazing, but a second set of eyes/ears can pickup on things we missed.

REOs on the market are higher priced here in CT as well. Last summer it seemed there were plenty of deals, but so far this year they are coming onto the market high! It's not just you.

Your renovation better include retrofitting the house back to a single family! Zoning regs and maps are usually available online. Look up the zoning and if it is single family (or even two family) only - you will need to return the house to a conforming state if you want to get a) a C/O or b) a mortgage at any point.

Tax assessments & bills are public record and searchable online. Google "TOWN, TX TAX COLLECTOR" or perhaps its done by county in texas. You can look up assessment, and usually find recent tax bills (though not always). Multiply the ASSESSMENT (not the appraisal) by the tax rate and those are your property taxes. Every municipality has a different set of rules for reassessment. I quick search online and I found that Texas does reassessments annually on Jan 1. So if you purchased the property, that sale price will be factored into the assessor's appraisal, but it is not solely based on sale price. If it were, people would pay minimal amounts on paper and deliver the balance in cash to avoid the taxes.

You cannot reduce the tax AMOUNT. Your city has a MIL rate at which it taxes property values. What you would be looking to decrease is your appraisal / assessment. Lookup the assessments of similar properties IN YOUR CITY! This is all public record. If they are lower than yours considerably, your city will have a process for contesting your assessment and seeking a re-evaluation.

Appraisal vs how much to offer are two WILDLY different things.

The appraiser is going to compute valuation based on multiple models, and then settle on an amount somewhere between them all: NOI at market cap rates, price per door vs. market, and a third way (usually one of $/sq.ft. vs market, $/bedroom vs. market, or book value as computed as replacement value less depreciation plus land value).

How much you should offer? Completely different story. Remember that for the purpose of the mortgage, the appraisal needs to come in at or above the purchase price (so the bank is protected), or else they will lower their loan amount (based on LTV).

Purchase price needs to be higher than sale price. 

I agree with posts above that primary residence does not qualify.

You can start with that. You know your tenants better than I do.

Tenant A) may accept responsibility and agree to pay. Tenant B) may be difficult and insist that it was never explicitly stated that the filter of the hot tub was included in items needing cleaning.

Over 50% of my experience in property management is in NYC, where tenants are both protected and quick to sue. So I always think about what would happen if we ended up in housing court over it. In this case, you would have a hard time winning with the wording that you copied above. But you are in San Fran and perhaps dealing with different tenants.

Perhaps start with explaining WHY the damage occurred (their failure to clean), specify that they must clean in the future, and tell them they are responsible for the bill. However, if they put up a fight, you're better off trying to negotiate a split than anything else.

@Al Williamson is correct. You are exposing yourself to either an age-based or child-based (family) discrimination suit. In our litigious society, we must always be mindful of these things (sadly).

With that said, if you cannot find a way out of it - talk to your current tenants. Don't start the conversation with "a potentially creepy single man is moving in", but a "family is moving in next door"... You might be surprised at how welcoming neighbors can be if its setup right.

That's awesome! I cannot believe you pulled off a flip in CT for so little? We just finished two projects, both ended up going over 150! Wildly jealous! But happy to see another CT investor!