Learn from mistakes - tips and suggestions # 5

Learn from mistakes - tips and suggestions

Learn from mistakes - tips and suggestions # 5

 

Post 3 - # Initiated week- Let the professionals do the management work and also .. Do not Judge a Book by Its Cover

The amount of knowledge given here on every field is so great and I think that real stories from the field are the most interesting way to get insights on how to make an investment correctly and what failures can happen in the middle, especially those that you do not matter will happen.

The next story is that of our field man, who has been investing himself for a long time. Told me the story of one of the first assets he acquired in Las Vegas. In my opinion a great story for novice investors.

Tailored tenants, husband and wife, came to him. The husband is an attorney and the wife is involved in the world of advertising. On the face of it, everything looked fine, the salaries were also arranged, so he decided to let them enter the apartment.

After two and a half years living in the apartment, they simply left the apartment with damage done to the apartment.

** Where were there actually hints that there would be problems and he turned a blind eye? **

1. They never paid in time.

In Las Vegas at the time there was a date range of 1-5 for each month, having to move the payroll. Beyond the 5th day start high Late Fee. The Late fee is less intended for creating better cash flow, but more for deterrence for the tenants. Although they never paid on time, he did not ask them to pay the Late Fee. (In our perception as experienced investors and entrepreneurs, this is a mistake.)

It was probably a place of kindness and inexperience in the field.

2. Each time there were stories of non-payment on time. The tenant would say that he was an independent lawyer and that the month did not go well for him or that the funds were not transferred to him on time. For the period of the two years he would receive funds in the date range of 15-20 per month. (10-20 days late)

In this case, as in the case of Israelis who do not live in the investment area, the property was not in the investor's residential area. After feeling that the management company he hired did not do a good job, he fired them because he believed he could do it himself, especially that he had contacts to help him with repairs if necessary.

It was time for a decision on his part to sell the property. It was at that time that the occupants were still in the apartment.

He raised the property to the market with an intermediary and wanted to go out in order with the tenants, so he offered them such a thing:

Keep the property clean all the time and your last month at the apartment - free of charge and you will receive your deposit at the exit.

They said okay.

The day before the property goes up to the market, the broker said she went to the property and did not open the door. He calls the tenants - no answer. Leave messages in voicemail - no repeat.

A few days pass, no sound and no answer. We do not pay, we do not go back to the phones.

He had to leave everything and fly to Vegas, when he discovers that they just left the house and left several thousand dollars in damage.

** Now .. Here begins trouble: **

Unlike a regular tenant, this is an attorney. If he knows the rules, he can hurt returns and profits significantly.

Starting to calculate in your head: In order to sue the tenants, you should take our own attorney, start a lawsuit process. For example in the Eviction process, the time periods vary from country to country until the trial dates are obtained. Let's say a date has been set for Core (Core Date). If the other party does not come, then you get permission to rent the house again (there are states that benefit tenants and there are states that benefit investors. An issue that is important to check from the beginning, in choosing the investment area), but the tenant has 10 days to file an appeal. If he really wants to hurt you, then he will file the appeal on the tenth day and then a new date is given for the trial. If faced with a smart tenant, he can attract the inexperienced investor about 3-4 months easily.

In terms of numbers:

This property was with a $ 1,100 monthly mortgage

The HOA was a monthly $ 320

Arnona of about $ 100 monthly

Insurance in the $ 30 monthly area

In total this will be over $ 1,500 per month. So if a person is stuck in your apartment 3 months, then here they flew $ 4,500.

So what happened to these tenants?

He had a neighbor of about 60 and had a good relationship with her because he offered his help if needed with a wave of burglaries that was in that area.

By chance, after a while, he discovered that his tenants had moved into her apartment. An apartment that is a door by a door.

** As you can see: **

1. Manage a property on your own, when you have no experience at all - less recommend.

2. We also told in previous videos of real estate voters, Condson videos in the field, in which the tenant "killed" his family 2 rounds, just to get a deferral of payment.

3. Before entering Eviction or any claims - it is important to consider who is the cause opposite and how long it will take to evacuate. Put the numbers on the table and see if this time is worth the money.

Excel can absorb everything, but real estate happens in the field! Real estate is people people people. No pretty presentations, no fancy offices and no blown up contracts. Business in general and real estate in particular you do with people.

5. Remember: Never judge a book by its cover.

**comments:**

It is important to note that this is a specific case.

We have cases where indeed tenants always pay late, but… pay. It's been like this for years.

Therefore… Each case on its own merits, but in general it is less advisable to show weakness in management. It is recommended to be strong and sometimes let go.

It is also important to note that it is equally important that with all the accompanying costs, we built a mechanism that prevents the investor from spending and obligates us to suffer if the investor does not profit.

This is for this time .. See you in the next post. Hope you enjoyed reading.

Attached is the pictures of the property.



































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