The sticks:
#Initiator of the week Adam Ashkenazi #Post4
In the previous post, I told about a building I purchased with 4 units, about the tenants there who didn't pay rent, about two management companies I fired, and about the decision to take it upon myself from now on to manage my properties.
So in the month of December 22, I arrived in Pittsburgh again, and I had several goals: to find an employee on a paycheck for a part-time position, so that she would work with me, and be committed to me. Of course, I had another goal, to take care of the renovation of a duplex that I purchased at the beginning of November, in Penn Hills (a town adjacent to the city of Pittsburgh), and also to take care closely, at 4plex.
Let's start with the duplex: Good deal on paper, good area, my first deal from Olsler, I offered 57,500 (the house is worth close to 150K today after renovation, and in my humble opinion based on analysis of similar deals - TLAH). The offer was accepted. This time, I insisted that one tenant who was still living in one of the two units, leave, so the closing took about a month and a bit.
I did not hire a lawyer to represent me, I went with the title that Holsler insisted on (a title that is friendly to Holslers in the area). I messed up big time. I thought I was a smartass and could manage on my own (after all, I'm Abu Ali, right? Third deal, little Ali? So it's not). I knew from two previous cases that the seller is responsible for handling the municipality's requirements regarding a rental and housing license. What else? Later it turned out that Holsler simply requested an AS IS approval, for closing purposes and not for housing license purposes. I didn't know about that, and the title didn't bother to inform me either (an objective title? Probably not). In hindsight, by the way, in legal consultation, it was made clear to me that I definitely have a cause of action for part of the renovation I did against Haussler, and possibly against the title. But karma "is a beach", and I prefer, and I preferred not to invest energy in legal proceedings (expensive - and they are expensive in the US).
In any case, the closing went smoothly. In the property itself, quite a few repairs were needed as follows (and this is the stage before the drama of the housing license, more on that later): it was necessary to remove a lot of garbage from the house (Americans are somewhat hoarders), it was necessary to repair entrance stairs to one of the units, two water tanks were replaced, two Furnaces (heating) were replaced, renovations in units and cosmetics, pressure washing, and a few other small things.
The renovation (phase XNUMX) took about a month. I spread the work among several professionals. Roof, I didn't replace it - even though it is old, the goal is to replace it in the summer, as of writing these lines it is still quite cold in the area, and so of course it was in December when the work began.
The contractor chosen was the contractor from the previous project, apparently a star. Only during the renovation, I discovered something called "contractor syndrome". I will explain: a contractor can be a star, do an amazing project, but then in the second project he either "feels himself", or takes on several other projects at the same time.
In my case, already when I was in the field I saw that something was wrong, he comes to work in the evening, works until early afternoon, but hey - he already did a project for me and some maintenance, I trusted him. The work - when I was in the field was done at a good pace, so I was forgiving.
Just as mentioned, I trusted him, I had already worked with him, and he was totally reliable (at the same time, he also helped me with two other small projects at 4 Flex where I evicted two tenants in the meantime). The stairs - were of course a catastrophe, I only found out about it later. He still tried to fix it, but they looked much less beautiful than I had hoped.
At the same time, the unit went on the market. It took some time, I lowered the price a little, and in the meantime - one tenant wanted to move in, closed everything, paid everything, took care of renters insurance, and let's go.
Two days before her move, she was in the apartment with my assistant in the field (I will write more about Amanda in the next post). And then, they were met by some very strange neighbor, whom I got to know even when I was in the field. I don't know if it's a matter of the soul or serious jealousy, because the specific house belonged to her and her husband until 2006, and it turns out that all the properties around my house (two intersecting streets) belong to them, and they've also been trying to sell all their properties for a year, without success (she told me herself, and I even considered making her an offer on one of her houses, only she demanded a super unrealistic price).
Later, my assistant also said that she came to the place to show the property, and this neighbor threw all her garbage at our place. The neighbor, didn't know that Amanda was my employee, and just threw the trash, and continued, until Amanda warned her about it, and she picked it up. There was also another case, during the renovation, that the neighbor's husband simply entered the house, when my contractor was working, and began to make comments about the work (you should do this and that), and enter the property without permission. My contractor waved it off. In short - strange people.
So let's go back to two days before the tenant was supposed to enter one of the units - the neighbor was there, and started asking questions, seemingly politely and kindly. My assistant told me about it in real time, she asked all kinds of questions, etc. (Amanda has frightening instincts, I had to listen to her on a few more occasions, when I listened, only good came out of it), apparently she foresaw what was going to happen.
Less than an hour after the conversation, I receive a phone call from a representative of the municipality, who told me "that he learned that my house is going to be rented." I innocently told him yes, I didn't understand what the problem was. Or then, he informed me that he had to do an inspection because there was a list of repairs in the house that had to be done before getting an occupancy permit. The same list, according to the inspector, was given to Title at the time, before the closing. Yes, he informed me that without an occupancy permit, I am not allowed to rent the apartment (which may result in charges in the local court, and fines).
Me - in shock, on the verge of a heart attack (no sarcasm, my wife sent me at that moment to walk outside and breathe air). The inspector (a very kind person, who really helped a lot later, I should say in retrospect and honestly), sent me the list of repairs by email. A list that was in the possession of the title and Holsler - and was not brought to my attention (again, to be clear, I admit, the mistake is mine, that I did not take care of legal representation at the time of the purchase, I do not blame anyone - only I am ultimately to blame).
I read the list of corrections, some were done by the way, some were not (whatever wasn't mainly my stuff wouldn't look dramatic). Moreover, the famous stairs from before - not up to standard, they need to be dismantled again, and there is still a lot of work to be done in the basement as well, and more. Full of little things that in retrospect I also discovered that this particular town is very aggravating.
Well, let's put aside the mental pressures I felt, because in the meantime - I had to take care of the tenant! that she could not move to a duplex, and she has already signed a contract.
Happily, the 4plex was partially vacant, after the eviction of two tenants, and happily my assistant had (and still has) a good relationship with that tenant (who turned out to be a great tenant who even sometimes helps me show units in the 4plex). My assistant talked with her, and told her everything that happened, and suggested that she move to an apartment in our building in the meantime. She agreed, of course the rent in the building is lower, but as compensation we offered it to her for a low amount of $650 with an option for a month. She agreed and moved there. The contract also stated that she has the right to move to the duplex, as soon as there is a license (later, she decided to stay in the fourx).
So I solved the tenant problem.
Now I had to find a repair contractor, the star contractor who failed me, I didn't agree to hire anymore. I checked several options, I took someone who overall made a good impression, and could also start quickly, had a license, had insurance, a reasonable price. He started well, did a fairly significant part of the work (let's say 60%). At some point, disappearance - not answering the phone, answering messages hours later, my assistant arrives at the duplex, and updates that he is not found. He says that he did this and that, my assistant comes and checks, and the things were not done. Even more than that, he scolds me for constantly checking on him. I wonder what he has to hide?
A delay of two weeks or more. In one of the correspondences, he was not even ashamed to write to me that he took 5 more projects, and he has no employees. As mentioned, at a certain point he did not talk to me on the phone, but only in messages.
After a little more than two weeks of delay, he was fired. He didn't demand anything, he probably realized that he messed up big time, and even if he asks, he can search.
Stuck again.
Now, let's take a break from the duplex. We will move to the front of the 4 Flex. To be clear, everything happens at the same time.
So at Fourplex, two units were evacuated after I fired the management company, a lawyer whose services I hired, took care of the official eviction (after a judgment had already been given, the management company waited for the eviction to be coordinated, it took her two months, my lawyer took care of it in two days). I had to take care of the repairs and prepare the two units for rent. The works mainly consisted of cosmetics. Two units went on the market.
At the same time, as I recall, there was another eviction claim that was rejected, allegedly on the grounds that the tenant suffers from a disability (in the lower courts, it turns out there is no protocol to verify). The lawyer I hired told me that it was a ridiculous thing, and in retrospect, it seems that the management company was quite upset with me, it was also quite clear in the conversation with them, that the representative who appeared in court was simply not familiar with the facts.
So I filed another eviction claim, this time the claim was accepted. But May? 90 minutes, the cheeky tenant, who has money for drugs, but no money for rent (even then there was talk of 7 months she didn't pay), filed an appeal. Yes yes, something that cost me another $2200 for lawyers.
She filed an appeal, which was scheduled for hearing three months ahead. In short, another 3 months without rent. What is sad is that when I was in the field in December, I met the tenant, after the verdict, and her brother, the latter told me that she would be leaving at the end of the week.
What a departure, and what shoes, minute 90, Friday, she filed an appeal (she has 10 days).
At the same time, another unit, whose tenant is a military veteran (remember the association from the previous post?), simply stopped paying rent. He met me in the field in December, and started telling me lots of stories about repairs, all cosmetic things, only these things he lived with for many years. Also, he claimed he had a problem with the refrigerator (I made sure to replace it and buy a new one).
When I met him, he paid part of the rent for the month of December, which was already the stage when I took control and management of the property, according to him he also paid two months before to the management company, he showed me a reference from which it was impossible to really understand anything. On the one hand, I could have insisted, on the other - I didn't want to mess with the toxic management company anymore, and I wanted to move forward and move forward. Maybe I gave up, or came off a little weak, I accept that, and I live with it. I wanted to run forward, and properly manage my money.
As mentioned, the tenant above stopped paying after December. Accordingly, he is contacted again and again, and he makes promises, then shamelessly he also announces that until repairs are made, he pays nothing.
Mistake (another one out of 100) - as soon as the tenant threatens like that, just file an eviction lawsuit (by the way, legally, I understood that he has to deposit money in trust if he has a dispute about repairs that aren't done, of course he didn't). This time, because I only took control and management of the property, and also because I felt bad about the way the property had been managed so far, I waited and waited, and I said to myself - I will take care of the repairs, and then he will have no excuses (bullshit, those who threaten like this usually won't pay later either ). Moreover, the tenant was also not ashamed on one occasion to complain that he used to pay 400 dollars, and today he pays 700 dollars. (So why did you sign a contract? I asked - he did not respond to this message).
Moreover, regarding the repairs in that tenant's unit, remember the star contractor? Who did a project in 4-plex, and also in duplex? So he was supposed to carry out the repairs in the same unit, only at the same time he was delayed because of matters related to him, and also because of a pipeline explosion in 4 Flex.
To say: Somewhere in early January, I get a call at three in the morning (from the same tenant who doesn't pay), a pipe burst in the basement (the height of the cold). Leaking water and dramatic basement flooding. The same contractor who was still working with me at the time (not the one who was fired in the duplex, but the first one who did work in the duplex and 4-plex), came to take care of it. A story of a few days, both to get all the water out of the basement, and also to take care of the pipes. Took a week and a bit, cost a lot of money (around $5000).
At the same time, when the contractor had already arranged to arrive at the unit of the reluctant tenant, to carry out repairs, the tenant did not open the door, because his wife was sleeping (and he was at work).
Finally, the repairs were done, even then they were done horribly by the (former) star contractor. After only a day, I sent another handyman, who completed the job properly, while the tenant also confirmed by phone that everything looked great, and promised to take care of the payment (lol).
Did the tenant pay after the repairs he demanded? Of course not, he just disappeared, didn't answer the phone for almost two weeks, not to me, not to my assistant.
This time, the games were over, an eviction lawsuit was filed (first a letter outside the door, then a lawsuit after 15 days). Of course, this is already a stage where I understand that this is a sophisticate. But a high-level sophist. For example, two weeks after the repairs, and after a letter was placed outside the door (the so-called "pay or leave"), he boldly sent messages to my assistant, with lots of complaints about the repair (bullshit because he told me on the phone that everything looked great), and more new complaints . In short, he waited two weeks to move out without paying rent, and at the same time he was looking for an apartment for himself, after an eviction lawsuit was filed against him.
To end the post, I'm already nearing the end of January - the beginning of February, I find myself bleeding expenses (paying bills at the duplex, legal expenses for evictions, and to contractors who carried out work cruises). With a non-paying tenant, another non-paying tenant who had the audacity to file an appeal against me, and with the malfunction in the form of pipes that exploded and cost about a third of the average salary in the economy. Yes, I also find myself with a duplex that was supposed to be a big promise, but it has been standing for two and a half months without functioning, and without income (and with a lot of bills), and without the possibility of renting (just to complete the picture, at the same time I run a law firm, yes?) .
It was a moment I wanted to quit. I wanted to drop everything and tell everyone thz$#$.
To be continued.
In the picture: me, and the only thing in life that manages to keep me sane.
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