All Forum Posts by: Watson Smith

Like already said... I'd pass.  But my main question is what kind of section 8 tenants do you have that you'd be comfortable putting in a 150k house? At $1200 a month?

I have to agree with the rest. 30% expense ratio is way to low for a SFR... much less a mobile home. You might get lucky one year and only allocate 30% but the next could be 70%. It'll even out in the end. Mobile home's depreciate and the expense grow every year. Like Charlie said you need to use 50% as your ratio and cap only the lot rent. There's some good advice on here and these guys are trying to keep you out of trouble. You can't treat a mobile home like a SFR. Best of luck.

I probably use the worse possible method to collect rents.  I have 11 tenants and 2 of them deposit it in my account, 1 sends a check monthly on the first and the other 8 I go and collect it in person.

Unlike many landlords I enjoy going in person.  Every month I shake their hand and go in the house like family.  A little small chat to see how the families doing and they normally ask how my wife is.  If their cooking I might grab a bite to eat as well.  I might even sit on the porch and drink a beer.  Time consuming - Yes - But I have very low turn over.  I've NEVER had to advertise vacancies and I have a waiting list of people calling often.  They need to see you as a person and not a mythical creature they send a check too. Most low income families never had a landlord like this... Their use to slum lords who churn and burn. I wouldn't use this method if I was renting to a more high income client.

Since I'm still small I can do this... Though later in life as my holdings grow this won't be feasible.  Its a great way to see your properties, check up on the neighborhood and make an impact on someone's life.  While this is a business you still have to enforce your rules... But good service pays dividends in the long run.

Buy more.

I'm 31 and at 11 SFR currently... There have been MANY sleepless nights. I had to get a mouth guard to wear at night cause I was grinding my teeth due to stress. If it were easy and stress free everyone would do it. Keep pushing and you'll get more comfortable therefor relieving the stress. Your young and can allow for more risk. I'd look at multi-family or commercial down the road. I won't be buying anymore SFR but looking at going commercial soon.

Don't just buy anything though.  It has to make sense and most importantly make money.  Re-think the house of yours that isn't cash flowing.  This is a business.  Upping rents $25-$50 most of the time won't push a happy tenant out.

Best of luck.

The listing agent doesn't get to decided who she sells it to.  Her job is to forward all offers on the house to the bank.  Get your own agent and submit an offer.  She has to turn that offer in... If not call your real estate commission.

First - Get a lease signed.  Tell them your insurance company is requesting it. (I use this excuse for everything)

Second - Never rent to friends or family members.

Third - Fix all the issues and just clean the mold.  When you go to unclog the drain make sure you show them what stopped it up the first time.  If its hair from them - joke about the issues and say I'm not coming over to clean up messes that you guys cause. A sink is not made for all this hair.  Remember, these are your friends so you should be able to joke with one another.

For rents that average between $450-$600 the area's aren't going to be that great... The appreciation on the homes won't be either.  In my opinion for this deal to make sense I would ask the seller to carry the note with little down and have them reduce the cost of the houses to get you to a min 10% cap.  Looks like their trying to sell it around 8% cap with a 50% exp ratio. Low income families can be very time consuming.  I do them in Atlanta but it would be hard to make money off $600 month while paying 45k for the house.

Sounds like you did the right thing.  I'd keep the second floor tenant on a short leash. Send a strong message to your other tenants that you don't put up with this kind of behavior.

 I've flipped 1 house in East Atlanta 3 years ago.  Looking back on it I should have held on to it... But I still did well.  I only do rentals now and I have my properties in Decatur, Rockdale and Snellville.  For rentals any area can be great or a disaster... it all depends on your tenants.  Best of luck!

East Atlanta seems to be a growing spot... Down Moreland Ave, Chamblee or Tucker are a few I would be comfortable with that you might be able to still find decent deals.. Any area that has a good school will be a hit.