Jump to content

Residential Slumlords, Holler!


Recommended Posts

So I have a couple rental properties and have fallen ass-backwards into great tenants on both of them.  Reversion to mean is real so I'm ready to struggle since I've always randomly met tenants that ended up working out.

My existing tenants at one house near Rollingwood just ended their 11 year run and now, for the first time ever, I have to search.  

Also, I've never hired a property management company but finally thinking about it since I don't even live in Austin and feel like I won't have same type of low maintenance tenants this time around.

Do yall use management company or run process yourself? 

If you search for tenants yourself, how do you advertise?  

Any other advice for someone who has been in the game for a long time but doesn't know much?   Call me the Greg Davis of landlords and I'm just longingly looking for my next VY.

Thanks in advance.

  • Hook 'Em 1
Link to comment
Share on other sites

I find my own, but I'm a realtor, so I have an advantage I suppose. 

There are a lot of services that help screen tenants for a reasonable fee.  Zillow does it IIRC.  I know of guys that will hire a property management company just to find the tenant, check references, credit, and do the lease paperwork. 

  • Hook 'Em 1
  • Like 1
Link to comment
Share on other sites

2 hours ago, Gil Bang said:

I find my own, but I'm a realtor, so I have an advantage I suppose. 

There are a lot of services that help screen tenants for a reasonable fee.  Zillow does it IIRC.  I know of guys that will hire a property management company just to find the tenant, check references, credit, and do the lease paperwork. 

thanks and DM me if you have any you recommend please.

 

And by finding your own and being a realtor, are you saying you post them on ABOR/Austin MLS?  I can finagle someone into doing that, I'm sure. But wondering if I'm a renter, where am I looking first?

 

Link to comment
Share on other sites

1 hour ago, Hornbeliever said:

thanks and DM me if you have any you recommend please.

 

And by finding your own and being a realtor, are you saying you post them on ABOR/Austin MLS?  I can finagle someone into doing that, I'm sure. But wondering if I'm a renter, where am I looking first?

 

I'm in San Diego. 

https://www.mysmartmove.com/ is one of the services.   I think I heard that zillow does something similar

 

  • Hook 'Em 1
Link to comment
Share on other sites

  • 1 month later...

I hope to have my first rental ready soon, so I’m really interested in what others that have experience can share. We stumbled upon an amazing deal for a lakeview house about 8 doors down. I was considering airBnb but was thinking long term would be easier. I’m starting from scratch with no idea what I’m doing.

Link to comment
Share on other sites

30 minutes ago, dlatin said:

I hope to have my first rental ready soon, so I’m really interested in what others that have experience can share. We stumbled upon an amazing deal for a lakeview house about 8 doors down. I was considering airBnb but was thinking long term would be easier. I’m starting from scratch with no idea what I’m doing.

Ready how?  I mean what are you doing if you are renting long term.  Did you have to do repairs?  
 

How much do you think it will rent for?  What will your mortgage, taxes. Insurance, and prop management be?  
 

If you’re doing long term, either you or your property manager needs to meet every prospective tenant for a tour. Weed out a lot of people that way.  Inspect the house every 6 months, start with 3 if you get a tenant you’re not sure about. “Oh I just ignored the drip” is a lot cheaper to fix after 3/6 months as opposed to 12-24 later when they move out. 

Link to comment
Share on other sites

8 hours ago, dlatin said:

I hope to have my first rental ready soon, so I’m really interested in what others that have experience can share. We stumbled upon an amazing deal for a lakeview house about 8 doors down. I was considering airBnb but was thinking long term would be easier. I’m starting from scratch with no idea what I’m doing.

I would suggest doing the math on BnB vs long term if it’s in a prime vacation rental area.  The numbers on that have changed dramatically in the last 2 years.  You can cash flow pretty good in some places now, and you don’t have to worry about getting a bad renter you have to deal with for a year.

Link to comment
Share on other sites

10 hours ago, UT_OB1 said:

Ready how?  I mean what are you doing if you are renting long term.  Did you have to do repairs?  
 

How much do you think it will rent for?  What will your mortgage, taxes. Insurance, and prop management be?  
 

If you’re doing long term, either you or your property manager needs to meet every prospective tenant for a tour. Weed out a lot of people that way.  Inspect the house every 6 months, start with 3 if you get a tenant you’re not sure about. “Oh I just ignored the drip” is a lot cheaper to fix after 3/6 months as opposed to 12-24 later when they move out. 

Yeah - the property sat unoccupied for a couple of years and was a disaster.  Pretty much a complete remodel on the inside except ripping all sheetrock out.

Question:  when weeding out tenants, do you just not approve their application?  Can you just do that for any reason, except race/religion/etc...? 

No mortgage, I know taxes and insurance.  I think the hard part will be pricing it.  The location is prime, awesome view of the lake with a small boat ramp (not private but not really used) directly across the street.  We were thinking going on the high end to perhaps weed out some tenants.  Since we live a few doors down I was planning on getting a property manager, hoping my wife can handle those needs.

Link to comment
Share on other sites

2 hours ago, Snake Diggity said:

I would suggest doing the math on BnB vs long term if it’s in a prime vacation rental area.  The numbers on that have changed dramatically in the last 2 years.  You can cash flow pretty good in some places now, and you don’t have to worry about getting a bad renter you have to deal with for a year.

That's a really good point about short term vs. long term related to how long we may deal with a bad renter we need to consider.  The location is pretty prime.  There's actually an air bnb next door and across the street (lake side).  That would require we would need to furnish it, be responsible for water/electricity, trash and yard maintenance, bookings fees, etc.  This is something we have been thinking about.   

Link to comment
Share on other sites

Posted (edited)
7 minutes ago, dlatin said:

That's a really good point about short term vs. long term related to how long we may deal with a bad renter we need to consider.  The location is pretty prime.  There's actually an air bnb next door and across the street (lake side).  That would require we would need to furnish it, be responsible for water/electricity, trash and yard maintenance, bookings fees, etc.  This is something we have been thinking about.   

This is strictly my opinion but I have found management companies to be well worth the cost of not having to mess with the upkeep and dealing with renters.  If it is in a prime area I’m sure there are multiple companies you can pay to turnkey it and deal with all maintenance, bookings, etc.  

Wrt long term renter screening, the 2 requirements I would never budge on are previous rental history and ability to come up with the deposit.  I always ask for higher than normal deposits because if someone can’t come up with a deposit not only are you not protected but it’s also a pretty good sign they will have trouble making rent.  And if any previous landlord has anything bad to say about them they should very likely be rejected.  I budged on each of those issues multiple times and got burned every single time.  If you are going to rent long term and manage it yourself, you absolutely cannot be a bleeding heart or you will get abused.

Edited by Snake Diggity
  • Hook 'Em 2
  • Like 1
Link to comment
Share on other sites

I say prime location being across from a lake but it is east texas so perhaps not so when it comes to property management.  I will definitely look into this though.  I acknowledge we need to do a bunch more leg work before we go live to learn about this all but surly is often a great place to start :).  How would you go about getting rental history from a prospective tenant?

Link to comment
Share on other sites

Posted (edited)
30 minutes ago, dlatin said:

Yeah - the property sat unoccupied for a couple of years and was a disaster.  Pretty much a complete remodel on the inside except ripping all sheetrock out.

Question:  when weeding out tenants, do you just not approve their application?  Can you just do that for any reason, except race/religion/etc...? 

No mortgage, I know taxes and insurance.  I think the hard part will be pricing it.  The location is prime, awesome view of the lake with a small boat ramp (not private but not really used) directly across the street.  We were thinking going on the high end to perhaps weed out some tenants.  Since we live a few doors down I was planning on getting a property manager, hoping my wife can handle those needs.

As others have mentioned, you may want to look hard at those Airbnb numbers if you’re really in that good of an area. I’m not a fan of the STR mgmt companies because of how much their cut is. I have 2 airbnbs that I’m an hour away from. If you have a good cleaning crew and know how to work a phone you don’t need to spend 20-30% for it to be managed.  Oh - don’t plan on cleaning it yourself if you do go STR. 

So you bought it cash?  I know some hate debt, but rates are still historically great. Get your cash out cheap and go buy your second. And third. 
 

More than likely you’ll have multiple potential tenants to screen. If they all pass credit and rental history, you can disqualify the ones that don’t show up on time (will they pay rent on time?) or give off crazy cat person vibes. Just an extra step to help pick. And I’d recommend farming out the rental application someone who does that for a living. 
 

eta - rental history searches available on line. I use keycheck because it was associated with furnishedfinder.com and was easy.  I’m assume there are many. 

Edited by UT_OB1
  • Hook 'Em 1
Link to comment
Share on other sites

^^^. Good advice from Snake Diggity.

I own a handful of duplexes in Tucson, manage them myself.  It's not too bad as long as you have a handyman and plumber on speed dial.

On tenants I've found good employment is the main factor in renting.  If they can easily cover the rent, rarely any problems.  So I check that out, and give their prior landlord a call to see if there were any problems.  

But I'll add that I also check the county records to see if the applicant has ever been evicted our arrested for a felony.  Pima County I can do that online easy, not sure if that's possible in the county you're in, but it's worth the effort.  I've bounced quite a few who were evicted or convicted of assault.

Good luck.

  • Hook 'Em 2
Link to comment
Share on other sites

Residential can be such a beating especially if you are real slumlords. We had almost 200 doors at our high point and then started a management company that managed another 450 or so. We had everything from rough properties all the way to super nice. We’re under 30 doors at this point as we’ve been converting from residential to commercial development and leasing over the last 3-5 years and have also sold the management company. Anything over a few and I’m using a management company. I don’t want the calls, it made better sense to pay someone else 6-8% to deal with it. There are several online only companies that do a good job as well.

  • Hook 'Em 1
Link to comment
Share on other sites

Super helpful advice so keep it coming for myself and others.

And again....lucked out from my original post.  Neighbor heard house was going to be on the market for lease from someone and figured out how to get my phone number and called me.  Wham bam, 1 year lease.

Only drawback is for sure only 1 year lease since they need temporary place as they are doing major renovation of home.  So no long term lease like my 11 year tenants.

Link to comment
Share on other sites

9 hours ago, Snake Diggity said:

This is strictly my opinion but I have found management companies to be well worth the cost of not having to mess with the upkeep and dealing with renters.  If it is in a prime area I’m sure there are multiple companies you can pay to turnkey it and deal with all maintenance, bookings, etc.  

Wrt long term renter screening, the 2 requirements I would never budge on are previous rental history and ability to come up with the deposit.  I always ask for higher than normal deposits because if someone can’t come up with a deposit not only are you not protected but it’s also a pretty good sign they will have trouble making rent.  And if any previous landlord has anything bad to say about them they should very likely be rejected.  I budged on each of those issues multiple times and got burned every single time.  If you are going to rent long term and manage it yourself, you absolutely cannot be a bleeding heart or you will get abused.

About the bolded part.  The current landlord may very well give a shit tenant a good reference, just to get rid of them.  Check the landlord before that one.  He'll give you the straight dope. 

  • Hook 'Em 2
Link to comment
Share on other sites

32 minutes ago, High Plains Drifter said:

 

How do y'all determine what rent to charge? How do you know what the market will bear?

 

I'm thinking of getting into the slumlord game in a few years when I take early retirement.

I've been monitoring the rent section of Zillow in my area for many months. Not renting just yet, but I have a real good idea of a reasonable rent to ask for. If you really wanted, you could track it in a spreadsheet, but I've been comfortable just checking rent offerings in my area every few days. 

  • Hook 'Em 1
Link to comment
Share on other sites

46 minutes ago, High Plains Drifter said:

 

How do y'all determine what rent to charge? How do you know what the market will bear?

 

I'm thinking of getting into the slumlord game in a few years when I take early retirement.

Houston has HAR. You can look at what has been listed for rent in the past 6mo/12mo/24mo and see what actually rented for what rate.  Better data than Zillow, but you can make Zillow work if you don’t have a HAR like site available. 

  • Hook 'Em 1
Link to comment
Share on other sites

My advice:
1. Hire a real estate agent to find and screen your tenants. It’s good to have a middle man in these deals;
2. Self manage;
3. Find yourself a good handyman. Ask your real estate agent for referrals. They have a guy for everything.

I’ve had rentals where I’ve collected $100k in between maintenance calls or turnover. Even if you’re overpaying for repairs, you’ll save a lot of dough by self managing and it’s really not that much work. With 1-2 rental properties, the vast majority of months involve nothing more than depositing the rent check and even that task is disappearing with electronic payments.

Bernard

  • Hook 'Em 2
Link to comment
Share on other sites

1 hour ago, Bernard said:

My advice:
1. Hire a real estate agent to find and screen your tenants. It’s good to have a middle man in these deals;
2. Self manage;
3. Find yourself a good handyman. Ask your real estate agent for referrals. They have a guy for everything.

I’ve had rentals where I’ve collected $100k in between maintenance calls or turnover. Even if you’re overpaying for repairs, you’ll save a lot of dough by self managing and it’s really not that much work. With 1-2 rental properties, the vast majority of months involve nothing more than depositing the rent check and even that task is disappearing with electronic payments.

Bernard

Number of calls is somewhat an inverse relationship with rent. The lower the rent, the higher the call volume. The higher the rent, the lower the call volume. True slum lords deal with a lot of calls because of the nature of the property and also the tenant. That doesn’t even get into routine maintenance issues. I don’t think I’ve ever had an issue with things like air filters getting changed in a $2000 a month rental, in one that is $750 you better have someone that handles that routine stuff for you.

  • Hook 'Em 2
Link to comment
Share on other sites

  • 4 weeks later...
On 3/19/2022 at 2:37 AM, Brew said:

Number of calls is somewhat an inverse relationship with rent. The lower the rent, the higher the call volume. The higher the rent, the lower the call volume. True slum lords deal with a lot of calls because of the nature of the property and also the tenant. That doesn’t even get into routine maintenance issues. I don’t think I’ve ever had an issue with things like air filters getting changed in a $2000 a month rental, in one that is $750 you better have someone that handles that routine stuff for you.

I have 1 in Montrose and charge a lot more than $2k.  I have to change the air filter because the tenant is not at all handy.  That juice is worth the squeeze though.

 

Link to comment
Share on other sites

6 minutes ago, huge said:

I have 1 in Montrose and charge a lot more than $2k.  I have to change the air filter because the tenant is not at all handy.  That juice is worth the squeeze though.

 

You charge them to do that?  If not you should. 

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share



×
×
  • Create New...