A lot of pain for smaller lenders who bought a lot of properties last 3-5 years.

Last month (September) we had a tenant reach out to us about a new tenant we recently placed.

Last contact I had with him said that he hoped distribution would come out in 90 days. 

Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”Key metrics for each Property Class:Class A Properties:Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.Tenant Default: 0-5% probability of eviction or early lease termination.Section 8: Class A rents are too high and won’t be approved.Vacancies: 5-10%, depending on market conditions.Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Class B Properties:Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.Tenant Default: 5-10% probability of eviction or early lease termination.Vacancies: 10-15%, depending on market conditions.Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.Section 8: Class B rents are usually too high for the Section 8 program.Class C Properties:Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years.

I had another person mention his name in the last week so clearly he is the guy!

I believe at that time the owner lives outside the country and last I spoke with them they were doing work in Pennsylvania. for me too risky to invest in a single deal where the sponsor lives outside the USA compared to dealing with people here I usa.  

When it hit >60 last week, I went short. 

Lastly, considering alternative materials that offer durability at a lower cost can also contribute to maintaining healthy profit margins.

Curious on others’ thoughts here:I sold off a bunch of my stock trading portfolio in the last month and now I have $50,000 that I’d like to reinvest in some manner.

Tighten the comps to around a .5 mile radius but definitely no more than 1 mile, use sales within the last 90 days but no more than 180 days, and rely on the lower end of the comp range instead of the top sale.