Landlords: How are you doing this year?

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AerialWombat
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Re: Landlords: How are you doing this year?

Post by AerialWombat » Wed Jul 08, 2020 9:09 pm

klondike wrote:
Wed Jul 08, 2020 7:52 pm
tomtoms wrote:
Wed Jul 08, 2020 7:15 pm
klondike wrote:
Wed Jul 08, 2020 6:06 pm
With the pending "free rent" bills at state and fed level, I don't feel like adding more rentals.
What is this free rent bill? Nothing is free. Someone has to pay for it.
Free rent means landlord is not allowed to evict tenants as soon as they claim they are affected by covid19. No proof is required. Yes they still owe you rents and are payable at the end but good luck collecting them.
So the tenants pass the buck to us landlords. We pass the back to the bank. The banks pass the buck to the Fed. Do the hokey pokey and ya' turn yourself around... :beer

Beensabu
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Re: Landlords: How are you doing this year?

Post by Beensabu » Wed Jul 08, 2020 9:48 pm

av111 wrote:
Thu Jul 02, 2020 9:43 pm
Anyone know? Have they lifted the eviction ban in California
No. Extended to July 28th. No doom till August.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next."

AlphaLess
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Re: Landlords: How are you doing this year?

Post by AlphaLess » Wed Jul 08, 2020 10:36 pm

Lumpr wrote:
Wed Jul 01, 2020 2:10 pm
Business as usual (mix of multi-family and SFH). Offered rent deferral in April to tenants who lost jobs or were otherwise suffering financial hardship. It was an honor system (i.e. we didn't require proof). Not a single person took us up on it.
This is very nice both ways: that you offered, and that no one took it.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.

AlphaLess
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Re: Landlords: How are you doing this year?

Post by AlphaLess » Wed Jul 08, 2020 10:37 pm

Beensabu wrote:
Wed Jul 08, 2020 9:48 pm
av111 wrote:
Thu Jul 02, 2020 9:43 pm
Anyone know? Have they lifted the eviction ban in California
No. Extended to July 28th. No doom till August.
But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.

Beensabu
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Re: Landlords: How are you doing this year?

Post by Beensabu » Wed Jul 08, 2020 11:34 pm

AlphaLess wrote:
Wed Jul 08, 2020 10:37 pm
Beensabu wrote:
Wed Jul 08, 2020 9:48 pm
av111 wrote:
Thu Jul 02, 2020 9:43 pm
Anyone know? Have they lifted the eviction ban in California
No. Extended to July 28th. No doom till August.
But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
I was wrong :oops: It's been extended through September 30th.

https://www.gov.ca.gov/wp-content/uploa ... -71-20.pdf

There's plenty of doom to go around. It looks like most people have been paying. The ability of many to do so will decline soon.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next."

smitcat
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Re: Landlords: How are you doing this year?

Post by smitcat » Thu Jul 09, 2020 6:25 am

scubadiver wrote:
Wed Jul 08, 2020 5:29 pm
smitcat wrote:
Wed Jul 08, 2020 4:59 pm
tomtoms wrote:
Wed Jul 08, 2020 4:51 pm
25% of NY renters are not paying rent: https://www.bloombergquint.com/business ... king-point

This is going to hurt.
You mean in addition to those that have rentals at college towns, vacation spots ,and near any larger employer who is transitioning to more of an online workplace.
I'm not disagreeing with this statement as much as I'm making a distinction. College towns and vacation spot rentals are a near-term issue for property owners which will pass in 6-8 months when we are (hopefully) all vaccinated. I would think that a seismic shift by employers towards a permanent online work place would manifest as more of a slower long-term transition, if it ever materializes.
"College towns and vacation spot rentals are a near-term issue for property owners which will pass in 6-8 months when we are (hopefully) all vaccinated. I would think that a seismic shift by employers towards a permanent online work place would manifest as more of a slower long-term transition, if it ever materializes."
Opinions vary for sure. Where we are in the NE many companies are already making permanent changes to their office space and staff distribution. Similarly there are differing thoughts on college and vacation choices made in the future.

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Meg77
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Re: Landlords: How are you doing this year?

Post by Meg77 » Thu Jul 09, 2020 4:07 pm

gophermobile wrote:
Tue Jul 07, 2020 5:41 pm
Hopefully not too off-topic, but I'm curious for those with 5+ properties how you ended up with that many? I'm assuming it's not previous places you've lived and decided to rent out. Are these properties in areas you're very familiar with and decided to purchase, or something invested in with others without much direct attachment?

I live in a HCOL area and finally purchased a small home last year, and could someday see renting it out when we buy a larger home. But I'm curious how you go from that to many properties? With that many is it more of your full-time job rather than some side income?
The key is not buying in a HCOL area. :) I bought my first duplex in my early 20s for $120K in a suburb of Dallas. Then bought another duplex every 18-24 months for a bit. The next cost $220K, the one after that was $165K (bought on a short sale during the great recession), and the next was $205K. I also rented out my homestead condo after I moved for a few years, but it didn't cash flow well so I sold it later. These are all around Dallas, where I live. I wouldn't say I'm an expert on each neighborhood or suburb, but I'm certainly familiar with the area in general and own them all 100% myself. For 5-6 years I managed them all myself, but it was becoming a bit of a part time job so I hired a property management company 7 years ago. Best decision ever. I cash flow more now after paying for mgmt. than I ever did managing them myself. I was not a great landlord obviously. :)

The multifamily investments I referred to in my post above are much more passive. I've never even laid eyes on most of them. I'm about a 1-2% owner in those.
"An investment in knowledge pays the best interest." - Benjamin Franklin

fareastwarriors
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Re: Landlords: How are you doing this year?

Post by fareastwarriors » Thu Jul 09, 2020 7:33 pm

gophermobile wrote:
Tue Jul 07, 2020 5:41 pm
Hopefully not too off-topic, but I'm curious for those with 5+ properties how you ended up with that many? I'm assuming it's not previous places you've lived and decided to rent out. Are these properties in areas you're very familiar with and decided to purchase, or something invested in with others without much direct attachment?

I live in a HCOL area and finally purchased a small home last year, and could someday see renting it out when we buy a larger home. But I'm curious how you go from that to many properties? With that many is it more of your full-time job rather than some side income?
I'm speaking for California or specifically Bay Area here. You buy first, then you wait. With appreciation, you cash-out refinance and use the extra proceeds as source of downpayment for next place. Hopefully at the same time, your income is growing nicely as well. Then rinse and repeat.

It's much harder now since prices are so high and there is very little appreciation last 2 years or so... Also with single family homes, the rent is unlikely to cover all your expenses. However California is basically allowing ADU and Jr. ADU in single family zoning, so that's an option to grow rental income.

And of course you can't forget about all the issues of being a landlord here like local/state rent control rules and regulations and any potential tenant issues.

Cycle
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Re: Landlords: How are you doing this year?

Post by Cycle » Fri Jul 10, 2020 12:25 pm

whoshighpitch wrote:
Wed Jul 08, 2020 9:58 am
Cycle wrote:
Wed Jul 01, 2020 9:09 pm
One property (2 units), lots of maintenance requests this year, for dumb stuff... E.g. tenant was turning key wrong way to unlock door, tenant closes window too hard and glass shatters, tenant reports garage door broken (replaced remote batteries). Have 2nd kid due in August and no longer want to do this stuff.

It goes live on the market on Friday... My landlord days may soon be over.
Mine is going on the market today. Been renting a single family home for 8 year and I'm sick of it. I have 3 young kids and it's just too much.
Using the 1% investors rule of thumb, I get 3150 per month in rent, so my rental should be worth like $320k. The taxable value is $360k. Highest similar comp was $440k.

After two days on the market and 1 showing, I have an offer for $500k which we've accepted. It could fall through, but there's not a lot of inventory in most markets. We're paying the buyers agent 2.5%. Redfin agent 1%.

I'm really surprised, considering it's on an extremely busy street, a teenage girl was recently murdered a few houses down in a drive by, and George Floyd was murdered a mile from the property.
Never look back unless you are planning to go that way

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Re: Landlords: How are you doing this year?

Post by flaccidsteele » Fri Jul 10, 2020 12:27 pm

Cycle wrote:
Fri Jul 10, 2020 12:25 pm
whoshighpitch wrote:
Wed Jul 08, 2020 9:58 am
Cycle wrote:
Wed Jul 01, 2020 9:09 pm
One property (2 units), lots of maintenance requests this year, for dumb stuff... E.g. tenant was turning key wrong way to unlock door, tenant closes window too hard and glass shatters, tenant reports garage door broken (replaced remote batteries). Have 2nd kid due in August and no longer want to do this stuff.

It goes live on the market on Friday... My landlord days may soon be over.
Mine is going on the market today. Been renting a single family home for 8 year and I'm sick of it. I have 3 young kids and it's just too much.
Using the 1% investors rule of thumb, I get 3150 per month in rent, so my rental should be worth like $320k. The taxable value is $360k. Highest similar comp was $440k.

After two days on the market and 1 showing, I have an offer for $500k which we've accepted. It could fall through, but there's not a lot of inventory in most markets. We're paying the buyers agent 2.5%. Redfin agent 1%.

I'm really surprised, considering it's on an extremely busy street, a teenage girl was recently murdered a few houses down in a drive by, and George Floyd was murdered a mile from the property.
MF is valued off NOI. SFH is based on comps. Apples to seaweed
The US market always recovers. It’s never different this time. Retired in my 40s. Investing is a simple game of rinse and repeat

Cycle
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Re: Landlords: How are you doing this year?

Post by Cycle » Fri Jul 10, 2020 12:48 pm

flaccidsteele wrote:
Fri Jul 10, 2020 12:27 pm
Cycle wrote:
Fri Jul 10, 2020 12:25 pm
whoshighpitch wrote:
Wed Jul 08, 2020 9:58 am
Cycle wrote:
Wed Jul 01, 2020 9:09 pm
One property (2 units), lots of maintenance requests this year, for dumb stuff... E.g. tenant was turning key wrong way to unlock door, tenant closes window too hard and glass shatters, tenant reports garage door broken (replaced remote batteries). Have 2nd kid due in August and no longer want to do this stuff.

It goes live on the market on Friday... My landlord days may soon be over.
Mine is going on the market today. Been renting a single family home for 8 year and I'm sick of it. I have 3 young kids and it's just too much.
Using the 1% investors rule of thumb, I get 3150 per month in rent, so my rental should be worth like $320k. The taxable value is $360k. Highest similar comp was $440k.

After two days on the market and 1 showing, I have an offer for $500k which we've accepted. It could fall through, but there's not a lot of inventory in most markets. We're paying the buyers agent 2.5%. Redfin agent 1%.

I'm really surprised, considering it's on an extremely busy street, a teenage girl was recently murdered a few houses down in a drive by, and George Floyd was murdered a mile from the property.
MF is valued off NOI. SFH is based on comps. Apples to seaweed
The value is how much money you get when the MF is sold.

This is a duplex, 2 units. The buyers, assuming they don't back out, are going to owner occupy both units. Elderly parents in one unit, young family in other. So in this case it is selling for a price that makes no sense based on NOI, my annual NOI was like 26k excluding interest / principal payments / vacancy / misc.

Assuming a 4% loan and 10% down, $26k - (450k*3.5%) = $8k cashflow. But that doesn't include expenses for vacancy / misc / tax increase, so cashflow would more likely be 0.... but seems like buyers don't care, since they are planning to owner occupy both units.

It is still possible the appraisal comes in low, which i sort of expect.
Never look back unless you are planning to go that way

AlphaLess
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Re: Landlords: How are you doing this year?

Post by AlphaLess » Tue Jul 21, 2020 10:33 pm

Beensabu wrote:
Wed Jul 08, 2020 11:34 pm
AlphaLess wrote:
Wed Jul 08, 2020 10:37 pm
Beensabu wrote:
Wed Jul 08, 2020 9:48 pm
av111 wrote:
Thu Jul 02, 2020 9:43 pm
Anyone know? Have they lifted the eviction ban in California
No. Extended to July 28th. No doom till August.
But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
I was wrong :oops: It's been extended through September 30th.

https://www.gov.ca.gov/wp-content/uploa ... -71-20.pdf

There's plenty of doom to go around. It looks like most people have been paying. The ability of many to do so will decline soon.
I would think it's more tied to the $600 federal corona unemployment supplement.

$600 * 4.3 = $2.6K. That's a lot on top of unemployment insurance.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.

Beensabu
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Re: Landlords: How are you doing this year?

Post by Beensabu » Sun Jul 26, 2020 6:15 pm

AlphaLess wrote:
Tue Jul 21, 2020 10:33 pm
Beensabu wrote:
Wed Jul 08, 2020 11:34 pm
AlphaLess wrote:
Wed Jul 08, 2020 10:37 pm
Beensabu wrote:
Wed Jul 08, 2020 9:48 pm
av111 wrote:
Thu Jul 02, 2020 9:43 pm
Anyone know? Have they lifted the eviction ban in California
No. Extended to July 28th. No doom till August.
But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
I was wrong :oops: It's been extended through September 30th.

https://www.gov.ca.gov/wp-content/uploa ... -71-20.pdf

There's plenty of doom to go around. It looks like most people have been paying. The ability of many to do so will decline soon.
I would think it's more tied to the $600 federal corona unemployment supplement.

$600 * 4.3 = $2.6K. That's a lot on top of unemployment insurance.
That's $31,200/year. I don't know anyone in this country who defines that as "a lot". Enough to get by? Sure.

It's what someone who makes $15/hr grosses, before payroll deductions.

It's certainly a lot more than $200 * 4.3 = $860, though. And ~$3500/mo is a bit more than enough for most. That was the point. Give people who literally do not have the option to work enough money to pay their bills, cover essentials, and spend on other things or save a bit. Maintain the status quo. Most state unemployment benefits are a pittance for low wage workers. The maximum is already incredibly low, and that's for those who were getting paid well. That's not that many people, unfortunately. There are also a lot of low wage single income families out there, not just individuals. $200-300/week wasn't going to cut it. And it still won't. Thus the ability of many to pay will disappear soon. You'll see it start nationwide for August rents, and definitely for September. It'll hit California in October/November.

I'd imagine anyone who has collected unemployment but not paid rent during the eviction moratoriums either had their unemployment claim processing for a long time (simply didn't have the money) or is saving in anticipation of the extended benefit ending. It's a gamble that there will be enough empty rentals from evictions and enough people with recent evictions on their records that the vast majority of rental applicants look equally bad and they'll be able to find another place without too much trouble. A tenant with no job, an eviction on their record, and $9k in the bank is better than leaving it empty until your only options are applicants with no job, an eviction on their record, and $0 in the bank. You'll get 3-6 months out of them if you're lucky.

The recently unemployed who have paid thus far hopefully have been saving enough of the extra to stretch a few more months before they're evicted too, but they won't have anything left saved at that point so they will actually look like worse potential tenants to landlords than the ones that didn't bother trying to pay at all...

It's a tough situation all around. It's not a good time to be a landlord (unless you're high-end in a hideaway town or debt-free), and a lot of highly leveraged people are going to lose their properties over this. New decade, different impetus, same old story.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next."

Topic Author
tomtoms
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Re: Landlords: How are you doing this year?

Post by tomtoms » Sat Aug 01, 2020 3:58 pm

How is everyone doing so far? Tenants still paying rent? What is your prediction for the next 4 months?

finite_difference
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Re: Landlords: How are you doing this year?

Post by finite_difference » Sat Aug 08, 2020 12:16 pm

tomtoms wrote:
Sat Aug 01, 2020 3:58 pm
How is everyone doing so far? Tenants still paying rent? What is your prediction for the next 4 months?
I’d be interested in an update, too.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh

LeftCoast
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Re: Landlords: How are you doing this year?

Post by LeftCoast » Sat Aug 08, 2020 1:11 pm

Here's an update for August from a landlord with 13 apartment units in the Los Angeles area. All the rents came in for August. One tenant is leaving, for a reason having nothing to do with the pandemic. I listed the unit online, and the listing contained lots of pictures and a video tour. I conducted several COVID-safe showings of the available unit, and rented it at market value. I'm pleasantly surprised. I've hear horror stories about tenants who stopped paying in April and haven't paid since.

LittleMaggieMae
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Re: Landlords: How are you doing this year?

Post by LittleMaggieMae » Sat Aug 08, 2020 2:43 pm

My townhouse and SFH tenants are up to date with rents. I won't see August rents until the 10th and 15th (auto pays, dates were my concession to the renters and it's part of the leases). I know one tenant has been working from home since April. I've heard thru the grapevine that my other tenant (who is currently employed) may ask to break the lease (ends November 30th) in October. They have are pursuing a job opportunity with their employer in another State. I will accommodate/work with them if they ask to end the lease early.

My prediction for the future: I'm seeing a lot of quick sales of houses/townhouses/condos at market (or above) prices. There's a lot of people "moving on up" or "moving to other places". I'm not seeing houses sit empty waiting for a buyer (unless they are flips and have been empty for months). I expect my 2 rentals to remain rented even if both tenants leave. I don't think rents will drop - I think they will stay the same.

I'm not sure if people like me (bought properties during the Great Recession) are now selling off their properties or not. All of the properties I see selling/for sale are "primary home owner owned"... I wondered if with the tight housing market if people who dabbled in "rental properties" after the Great Recession would "cash in" and sell their properties.

flaccidsteele
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Re: Landlords: How are you doing this year?

Post by flaccidsteele » Sun Aug 09, 2020 1:08 am

tomtoms wrote:
Sat Aug 01, 2020 3:58 pm
How is everyone doing so far? Tenants still paying rent? What is your prediction for the next 4 months?
All tenants still paying rent. No delinquencies. No evictions.

Was surprising in March/April but now, not so much. Business as usual

Impossible to lose when I bought all my rentals during the credit crisis when property was effectively free

I’ve been investing since the 1990s, and when it comes to stocks and real estate, buying more during crashes has been the simplest way to build effortless wealth

The tech wreck, credit crisis and housing crash were amazing wealth boosters for me. The virus crisis would’ve been one as well if it wasn’t so short
The US market always recovers. It’s never different this time. Retired in my 40s. Investing is a simple game of rinse and repeat

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AerialWombat
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Re: Landlords: How are you doing this year?

Post by AerialWombat » Sun Aug 09, 2020 1:18 am

All paid, never late, no issues. Turned two units in June with only a few days vacancy. It’s business as usual, except that I’m not buying another one right now, which feels weird.

bog007
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Re: Landlords: How are you doing this year?

Post by bog007 » Sun Aug 09, 2020 2:02 am

2 rentals. No problems

oldfort
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Re: Landlords: How are you doing this year?

Post by oldfort » Sun Aug 09, 2020 9:48 am

Beensabu wrote:
Sun Jul 26, 2020 6:15 pm
AlphaLess wrote:
Tue Jul 21, 2020 10:33 pm
Beensabu wrote:
Wed Jul 08, 2020 11:34 pm
AlphaLess wrote:
Wed Jul 08, 2020 10:37 pm
Beensabu wrote:
Wed Jul 08, 2020 9:48 pm


No. Extended to July 28th. No doom till August.
But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
I was wrong :oops: It's been extended through September 30th.

https://www.gov.ca.gov/wp-content/uploa ... -71-20.pdf

There's plenty of doom to go around. It looks like most people have been paying. The ability of many to do so will decline soon.
I would think it's more tied to the $600 federal corona unemployment supplement.

$600 * 4.3 = $2.6K. That's a lot on top of unemployment insurance.
That's $31,200/year. I don't know anyone in this country who defines that as "a lot". Enough to get by? Sure.

It's what someone who makes $15/hr grosses, before payroll deductions.
Then, you need to know more people. The median weekly income for a full-time worker is $1002 a week. Men make a little more and women make a little less. Unemployment + $600/week means a lot of people were bringing in more money during COVID than when they were working.

stoptothink
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Re: Landlords: How are you doing this year?

Post by stoptothink » Sun Aug 09, 2020 10:47 am

oldfort wrote:
Sun Aug 09, 2020 9:48 am
Beensabu wrote:
Sun Jul 26, 2020 6:15 pm
AlphaLess wrote:
Tue Jul 21, 2020 10:33 pm
Beensabu wrote:
Wed Jul 08, 2020 11:34 pm
AlphaLess wrote:
Wed Jul 08, 2020 10:37 pm


But you would expect the doom to come before, right?

As long as there is no eviction, there will be non-payment by some.
I was wrong :oops: It's been extended through September 30th.

https://www.gov.ca.gov/wp-content/uploa ... -71-20.pdf

There's plenty of doom to go around. It looks like most people have been paying. The ability of many to do so will decline soon.
I would think it's more tied to the $600 federal corona unemployment supplement.

$600 * 4.3 = $2.6K. That's a lot on top of unemployment insurance.
That's $31,200/year. I don't know anyone in this country who defines that as "a lot". Enough to get by? Sure.

It's what someone who makes $15/hr grosses, before payroll deductions.
Then, you need to know more people. The median weekly income for a full-time worker is $1002 a week. Men make a little more and women make a little less. Unemployment + $600/week means a lot of people were bringing in more money during COVID than when they were working.
The latest data showed that >2/3 on UE were earning more with $600/week supplement than they were working https://www.npr.org/2020/05/26/86190661 ... s%20income. The large majority of those laid-off since March were/are in low-skilled/low-pay industries (ie. retail and restaurants).

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