My second Investment property was a vacant bar/tavern in a small town that had gone out of business, right on the frontage road of a 4-lane US highway. It was purchased as a partnership with my uncle. We were going to buy this property and get it ready to run a bar and restaurant. Then, we were going to be owner operators of the business. Continue reading “My Second (and third) Investment Property”
Lowering the Rent vs. Lowering the Deposit to Attract Quality Tenants
Sometimes, we think we have to attract quality tenants in unconventional ways. Many people have no money. After showing your unit many times, you do not think anyone has any money. Some people have lower income levels. Some people lack the ability to save, and a landlord wants to “get them in”, so they lower the tenant’s entry hurdle or security deposit. This is a mistake that will almost always come back to haunt you. You have a hard time renting your unit, and you finally have a tenant willing to move in. The only issue is, they do not have enough money to move in. They probably do not have a high credit score either. Continue reading “Lowering the Rent vs. Lowering the Deposit to Attract Quality Tenants”
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Low Rents Attract Trash
Low rents. The fact of the matter is, the lower your rent is, the more affordable it is to sub-par renters, or trash. You will attract them in droves at a low price. But the flip side to that is you also attract more good renters. Good renters are always looking for a bargain; good renters that know their financial limits, good renters do not want to live paycheck to paycheck just paying rent. Good renters know what they want, and will not pay a penny more. Good renters may even want to negotiate a bit, just to make sure they are getting the best price. Continue reading “Low Rents Attract Trash”
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My First Investment Property
My first investment property I was ever involved in was before I ever owned a place for myself. I was living in my dad’s duplex while I was going to college. I was lucky, he paid the bills, and I paid for my college. He lived somewhere else, although it was close by. This is the story of how I became the owner of my first property. Continue reading “My First Investment Property”
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A Day in the Life … Busy day
So, a break from the advice for a post. A few words about practical landlording and the often busy day.
It was a busy day in the life of a landlord today.
I went to the apartment this morning before work to pick up the last rent check that was put in the rent box the night before. All 25 (of 25) rents in the bank by the morning of 3/4/14, which is pretty good. All except my Section 8 tenants portion of the rent, $125 which I will expand on later… Continue reading “A Day in the Life … Busy day”
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Risk vs. Reward, How To Predict Profits
Predict profits for your rental property.
Let’s assume that your property is renting for $1000 per month. Let’s also assume you collect a $1000 security deposit. Continue reading “Risk vs. Reward, How To Predict Profits”
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Proper Preventative Maintenance
To maintain profitability in an investment property, you need to do proper preventative maintenance.
On a tenant turn, you need to check items so that they do not cause you issues later on, when a tenant is actually living in your unit. Maintenance is exponentially more difficult when you have to coordinate your schedule with your tenants. Continue reading “Proper Preventative Maintenance”
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When and How to Renew Leases
Most landlords do an annual lease to start, when it’s time to renew leases, they often have difficulty. Most annual leases turn to a 30-day lease at their expiration. The question is what thought process goes into the method of continuing the tenancy. Continue reading “When and How to Renew Leases”
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Tenants Credit Score and Income – What do they mean?
Remember, it takes both a decent credit score, and an income high enough to pay rent to approve a prospective tenant. Never accept less. You need to know both the tenants credit score and income level before you approve them.
A renters income will give you the renter’s ability to pay rent. Their credit score will give you the renters desire to pay rent. Both are required.
Continue reading “Tenants Credit Score and Income – What do they mean?”
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Property Managers, The Downside
Property Managers (PM) that do turn-key management have goals that are often opposite of an owner. This is especially true of inexperienced PMs. A PM makes money when they fill a unit. A PM makes money every month when rent is collected, sometimes even if it is not collected. A PM makes money when your place needs maintenance. A PM makes money on an eviction. A PM makes money when they turn the unit. A PM makes more money when they have to evict and turn a unit, than when they are renting it to a long term, good quality renter. A PM makes more on subpar renters, than solid ones. You make more money on a long term, good quality renter. Remember, great tenants manage themselves. It is cheaper to lower your rent, and get better tenants, than hire a PM. Continue reading “Property Managers, The Downside”
