Landlords!

[floridaorange]

We bought an investment single family home in a hot sub market and live nearby so I'm gonna be doing some of the property maintenance and landlord. In about 2 yrs we plan to demo it and build a custom home with pool etc. Its a really cool property in that you can access it from front street and rear.

Anyway to the point - what non-obvious advice might you have for a first time lessor?

[Grumpy Old Man]

Screen any perspective tenants really well, references, credit score, employment history etc. My current tenants are late with the rent almost every month, they get caught up but it's a real pain in the ass and it's nearly impossible to evict someone in Ontario.

[Run Silent]

Originally Posted by floridaorange

We bought an investment single family home in a hot sub market and live nearby so I'm gonna be doing some of the property maintenance and landlord. In about 2 yrs we plan to demo it and build a custom home with pool etc. Its a really cool property in that you can access it from front street and rear.

Anyway to the point - what non-obvious advice might you have for a first time lessor?

I've owned 2 homes and had my RE license in California and did commercial real estate investment work for a handful of yrs a while back, I'm 39 married with 2 kids 1 is a baby so I'm hoping this doesn't spread my time too thin.

100% agree with Grumpy on this. The biggest problem is getting solid tenants in the dwelling. Many people are not who you expect them to be upon first glance. Don't just rely on credit score, either. Really look at their job history, job time, debt to income ratio's, where they are in life, et al.

Where in Orlando is the home? I was born and raised there and have some insight as to that market - and can also give you some pointers on tenants based on where the house is located.

[floridaorange]

Thank you I appreciate it, we're not far from Florida hospital - will absolutely be careful with screening tenants! I've got some good application processes advice.

[UncleWede]

Be quick about your repair work when a tenant leaves. At least in Cali, after 30 days you have to give them their deposit back.

Check with the local utilities, if they are the tenant responsibility. Again, 30 days after they leave you have no recourse when you get stuck with water/sewer/trash they didn't pay.

[The Libertine]

Originally Posted by Grumpy Old Man

Screen any perspective tenants really well, references, credit score, employment history etc. My current tenants are late with the rent almost every month, they get caught up but it's a real pain in the ass and it's nearly impossible to evict someone in Ontario.

Make sure you have a solid understand of laws around eviction, as they are often slanted in favor of tenants rights which tenants can, and will manipulate to their advantage.

Which leads me to my next point: the lease. While laws may favor the tenant, you can even the score by drafting a lease to your favor.

Always, always, always respond quickly to, and document requests for repairs. Tenants will often cite “issues” (which you may, may not even know about) as reasons to withhold rent.

[floridaorange]

[QUOTE=The Libertine;24950992]

Originally Posted by the libertine

Always, always, always respond quickly to, and document requests for repairs. Tenants will often cite "issues" (which you may, may not even know about) as reasons to withhold rent.

Good point mate thank you

[ipilcher]

Keep records!

There's nothing worse than trying to do your taxes and realizing that you don't have a critical piece of information/documentation. For example, you should log all of the time that you spend working on the property or with prospects/tenants; 250 hours in a year meets the IRS safe harbor requirement for the 20% qualified business income deduction. Also, be familiar with the rules around sending out 1099s.

Speaking of taxes, they're not really that bad *if* you understand basic accounting principles. (FreeTaxUSA.com will e-file all the required Federal forms free of charge.) Even if you choose not to do them yourself, you really should ensure that you understand how they work, so you can make intelligent financial decisions.

[E92 M Sport]

Originally Posted by floridaorange

Anyway to the point - what non-obvious advice might you have for a first time lessor?

Sell it. I was always cautioned about being a landlord and I’m glad I followed the advice. Can’t speak for Florida laws, but good luck evicting somebody in Jersey. Such a joke. Good luck.

An acquaintance shared this site with me which they use to screen tenants:
https://www.mysmartmove.com/

Has anyone used it or anything similar?

[Clark_Kent]

Great points raised by many in this thread. If you do not already have an umbrella policy, I highly suggest acquiring one. Also, if you do not have a lawyer, I would identify the individual and have him/her at the ready in the event you need legal services.

Being a landlord can be extremely rewarding; however, it can be very challenging. After several years of owning rental properties we recently liquidated our entire portfolio. It got to a point where the effort outstripped the value. YMMV. Anyhow, good luck and keep us posted on how it goes.

[Clark_Kent]

Originally Posted by FCobra94

An acquaintance shared this site with me which they use to screen tenants:
https://www.mysmartmove.com/

Has anyone used it or anything similar?

Yes, I've used this service on a number of occasions and it's solid. It's incredibly user friendly and the output is useful. USAA was offering a very nice discount many years ago on the service so that was enticing for me.

[irishbimmer]

I once had to pay the tenant to leave my property-to evict them for non-payment so don't trust anyone, get big deposits and cross your fingers.

[Clark_Kent]

Originally Posted by irishbimmer

I once had to pay the tenant to leave my property-to evict them for non-payment so don't trust anyone, get big deposits and cross your fingers.

Sometimes that's the best path forward. A wise investor friend of mine gave me that advice many years ago.

[floridaorange]

Thanks for all the great advice! Tomorrow the 3/1 is being painted and then the original oak floors are being sanded and refinished - it's throughout the house except the kitchen is pine currently under linoleum, which will also be refinished.

I live next door so the tenants will have to also be people we don't mind living next to. In 2 yrs we hope to tear it down and build a custom 2-story home on the lot.

I've gotten some interest @ $1,800 x month already... but decided to wait to re-list once home is completely ready. Still need to add washer dryer, dishwasher, microwave and oven.

[UncleWede]

Newly refinished oak floors?
I hope u get a HUGE deposit and no longer care about all the scratches. No tenant is going to have felt on their furniture

[Clark_Kent]

Originally Posted by floridaorange

Thanks for all the great advice! Tomorrow the 3/1 is being painted and then the original oak floors are being sanded and refinished - it's throughout the house except the kitchen is pine currently under linoleum, which will also be refinished.

I live next door so the tenants will have to also be people we don't mind living next to. In 2 yrs we hope to tear it down and build a custom 2-story home on the lot.

I've gotten some interest @ $1,800 x month already... but decided to wait to re-list once home is completely ready. Still need to add washer dryer, dishwasher, microwave and oven.

Seems like you’re putting in way too much money only to demo it in 2 years. Why sand and refinish floors if you plan to push it over in 2 years? Are they in that bad of condition? New appliances as well?

[floridaorange]

I'm pretty good at buying appliances off people that haven't used them much... using various apps. Orlando is a very transient city so there is lots of barely used appliance inventory.

The floors were covered in carpet and do need refinishing. I've got guys that can do it affordably, I'll post before and after pics. We may or may not tear it down one day we'll see. It was built in 1950, concrete block. Detached garage. I love it, but wife wants to build on it.

[UncleWede]

Originally Posted by floridaorange

It was built in 1950, concrete block. Detached garage. I love it, but wife wants to build on it.

1952, some of the raised foundations is actually on ROUND rocks, and I was harping on the wife just this past weekend: LIFT the bed, don't just drag it across the (installed about 12 years ago) nice floors!!!!

[NEfan508]

I have a few rental properties, one was my FIRST house, my twin girls first bath was in the sink, years later we moved, my renter was a slob, dirty bastard for sure

Wife had a strong connection to our (1st Home)

Wife visited the house to meet a contractor for something? she argued with the renter (also female) why does the house smell? Why is garbage in the kitchen hallway? rodents soon to follow!?!? my kids were in that sink 1999 why is fucking dishes just sitting in a 3' pile? Use the damn dishwasher, lazy dirty whore!
cops came soon after... wife got arrested


do not look @ your rental as your home, it's just a investment

Shave off some rent to get a renter that appreciates the deal, loose a few grand a year for a smiling drama free renter

To throw out a renter in the commonwealth of Massachusetts (good luck) must give proper notice, go to court, have all belongings in storage = months of time and thousands of dollars, take off $200 market rate rent, quality renters will fight to move in, also I have 3 kids, kids destroy homes, try to get a gay couple, most have extra income and are neat, can't put that in a ad that's for sure

[ScottyRyan2019]

We were slumlords for about 10 years with a beautiful townhouse we owned. One thing we did that really kept the riff-raff out was to require them to have income of 3 x rent (plus references, credit score, etc). So if rent was $2,000 a month then their income needed to be $6,000 a month. We had no trouble finding people to rent to in the market the home was located in and all four of the renters we had in the 10 years were outstanding and took very good care of the place and paid on time. Granted, this may not work for everyone, but it did for us in the market we were in.

Also, know your landlord/tenant laws inside out. In Minnesota the Office of Attorney General has this on their website. Be sure your lease agreement is in full compliance (DO NOT get caught discriminating). Be sure your lease agreement spells out exactly all expectations. Be sure you follow it to a T. Don't cut your renter any slack. If it says they get hit with a penalty after 15 days of being late, penalize them. If it says they get thrown out after being late three times, throw them out after three times. Document everything you do by email. Don't fuck around. I know several people who are landlords. The courts (in my state) will side with the landlord almost every time IF you have a sound lease and follow it.

[floridaorange]

Great advice thank you I like that a lot - makes good sense. We had experienced realtors of the area suggest starting at $2k per month.