The Landlord Thread

[debthaven]

Bonny no desire to sell another place? You have 4 left, right?

[debthaven]

Because we need money. But yes, absolutely, it would be better to wait. Hence DH telling me we need to cut back, earn more, and wait ... All of which we have been doing but I'm really sick of the financial stress.

ETA: I think we will probably NOT list the place we DON'T want to sell for now. So we'll see what happens by early Jan. Hopefully there will be a miracle and we WILL manage to sell the place we WANT to sell. If we don't, we'll take it off the market.

[Bonny]

Nov 14, 2016 17:31:44 GMT -5 debthaven said:

Bonny no desire to sell another place? You have 4 left, right?

Well DH would sell the condo in a heartbeat.

[debthaven]

Update, maybe ... one of the other landlords told me she heard from the prop management co, and that they were calling a meeting to vote the building renovations. They told her we'd get an email today. If it's true that's fantastic!

This said, part of the reason we listed low was to avoid paying for these renovations. So if it is true, we'll take it off the market, because we don't want to get that low price AND be OOP for the building reno.

Which means we either "tough it out" or sell the other studio. Decisions decisions ... DH is in the UK so I won't do anything until he gets back in the next few days. I'm pretty sure he'll say to "tough it out".

[Bonny]

So I got a note from the condo tenant advising me that he's scheduled fumigation for his new house and he can't move out on the 30th as promised. I asked him if the condo would be ready Dec1. I got an e-mail from him that he's decided that since he's paying for the unit he might as well stay until the renovation work on his house is done.

Needless to say I was really, really annoyed. I can't have him jerking me around with the move-out date.

I contacted our atty who has instructed me to pull the property off the market until the tenant has vacated. He says the tenant is exposing us to legal action if we can't deliver the property as promised. And while it's never happened to me, I have heard of people in protected classes "testing" the system; in other words looking for landlords who won't rent to them because of race, family status or whatever by claiming the property isn't available. That's all I need.

Had to wait two days before tenant and I could speak. He's really in a panic because he's going to be making payments on my $3,700 condo as well as his mortgage on an $850k house. I feel bad for him but he has really gotten himself into a bind.

Had my atty review my letter memorializing the conversation. Made my day that he said it was "perfect". I'm sure it wasn't but happy I got it technically correct, right tone and got my point across.

I copied my agent. I think there's a chance tenant will change his mind and vacate the property on the 1st although he's going to be hard pressed to get window washers, carpet cleaner and house cleaners in there by the 1st given the Thanksgiving holiday. If I don't get that kind of an e-mail within 24 hours I'll instruct the agent to withdraw the listing.

I knew this was going to be a pain.

[debthaven]

I'm sorry Bonny. It's always something isn't it?! I hope it works out quickly.

So DH surprised me and told me we should list the other studio. I spoke to the agent on Sat, she's sending us the paperwork on Tues, it should be listed next week. Fingers crossed. We're listing it high and it has a tenant, so I don't think it will sell quickly.

I still desperately hope the other one sells first. I'm still toying with lowering the price one last time but DH doesn't agree for now.

[Bonny]

Good luck debthaven!

Since the last update, tenant said to go ahead and pull property off the market, he will continue to market on his own. Yeah, right. Between him working full time, traveling, moving, renovating his new house, being a single dad he has that kind of time. 

I reached out to him Friday and suggested that he might look into marketing to a corporate relo/short term assignment arrangement. Property would need to be furnished but with he and his fiancée moving in together they may have enough furniture to make it work. He thought it was a good idea. Then he offered to make a cash settlement of $10k.

That's not enough. By the time you add up the 7 months of remaining term plus the costs associated with re-leasing the property he's on the hook for close to $30k. I'm sure I can get a renter in by February but I'm concerned I'd need to discount the rent and wind up with another turn in June. Of course my attorney is in Baja right now. He's checking his e-mail occasionally. If I don't hear from him by noon tomorrow I'll send to tenant anyway.

I love how some people expect you to clean up their messes.

[debthaven]

Bonny I never want a renter in my places that doesn't want to be there. Of course the laws here are much more tenant-friendly than in the US (ie 3 months' notice gets the tenant, but not the landlord, out of the lease.)

Maybe it would be worth trying to find a compromise so he gets out and you can turn it around sooner?

Dunno, just a thought.

ETA: I know it's not right but maybe it's easier (on you of course)?

[Bonny]

Nov 21, 2016 16:42:37 GMT -5 debthaven said:

Bonny I never want a renter in my places that doesn't want to be there. Of course the laws here are much more tenant-friendly than in the US (ie 3 months' notice gets the tenant, but not the landlord, out of the lease.)

Maybe it would be worth trying to find a compromise so he gets out and you can turn it around sooner?

Dunno, just a thought.

ETA: I know it's not right but maybe it's easier (on you of course)?

Well things are getting more difficult. After withdrawing the property because he refuses to vacate while he's paying, he now wants me to list the property with his agent.

I wrote him a nice, firm e-mail advising I wasn't going list with his agent and reminded him the reason the property was withdrawn was due to his failure to commit to vacating date.

I just got nasty e-mail from him stating he's going to talk to a lawyer, that he may rent out his new house because the landlord is more reasonable and a sarcastic comment thanking me for being so understanding about his situation.

This is a fair amount of money. Rent is $3700 month and with the remaining term and my estimate of expenses he's contractually obligated to pay us nearly $30k.

He's put himself between a rock and hard place and I'm not going to bail him out of his mess.

[debthaven]

Ouch Bonny ... that really sounds fishy, with him wanting you to relist with his agent! What do you think his goal is?

So of course the agent for the place we DON'T want to sell did not send the paperwork she promised to send today. I'm pretty overwhelmed with the end of the semester so it will happen when it happens.

Apparently the company that manages the building of the studio we DO want to sell is indeed scheduling a special meeting to vote the renovations. I'm in touch with another owner who has been following up with them. They assured her they didn't have time to send the letter last week, but that it's definitely going out this week. She's not technically an owner, in fact, her young adult son is. But she's really good with this sort of thing and she's furious about things so she's following very closely. She calls or texts me anytime she hears from them, which I'm very grateful for.

Hopefully one place or the other will sell at some point. Once I receive that letter about the meeting to vote the building reno, I will take the studio I DO want to sell off the market, bite the bullet, and hope the studio we DON'T want to sell does indeed sell.

Not sure if that makes sense lol. 

[naughtybear]

I'm a little confused. Condo tenant was vacating but still be on the hook for the remainder of the lease. Decides to go ahead and stay seeing as he would be paying for the unit anyway? Apart from reneging on moving what is wrong with that. Isn't is preferable to have the condo rented? I assume the original arrangement worked for both parties.

[debthaven]

The agent for the place we'd rather NOT sell (let's call it Studio F) sent the papers by email and by mail today. I "signed" the email papers and asked her to please list Studio F ASAP even though she won't have the papers back in the post for a few days, but I'm not sure she will. It's on its way though! 

The studio we DO want to sell is Studio B.

[Bonny]

Nov 23, 2016 8:31:43 GMT -5 naughtybear said:

I'm a little confused. Condo tenant was vacating but still be on the hook for the remainder of the lease. Decides to go ahead and stay seeing as he would be paying for the unit anyway? Apart from reneging on moving what is wrong with that. Isn't is preferable to have the condo rented? I assume the original arrangement worked for both parties.

He wants to vacate but only when we find a new tenant. He wants me to continue to market the property but because he won't commit to a move-out date I can't market the property with a reliable lease commitment date. I could get into big trouble and risk a lawsuit if I advertise one date and can't actually deliver as promised.

So he wants out but only if it's convenient for him. I'm not playing that game.

[debthaven]

Finally, good news on the studio ... no, we don't have an offer. But after 7 months of no news from the building management, despite a million emails and phone calls, we finally received an email with a date in Jan to discuss the estimates, and a date in March for the Annual General Meeting. This is a GREAT relief, because it seemed very likely that they were going to us (and I know for a fact they nearly did).

So, as of today, we've taken that studio off the market. The good news is that it looks like the building will finally be renovated, and the management isn't dumping us because the case is difficult. The bad news is, it looks like we won't be able to sell it for a while.

So long story short, DH will probably take money out of DS3's college fund to pay for the building renovations, and we'll reimburse that money (as well as 5K we borrowed for the kitchen) to the college fund when we sell it further down the road.

The other studio is still for sale, although there haven't been any bites on that one either. Both agencies are telling us there are no more RE investors here these days, people only want to buy a place they can live in. And unfortunately, both places are rented, with the standard 3 year lease.

[Works4me]

Dec 22, 2016 18:20:24 GMT -5 debthaven said:

Finally, good news on the studio ... no, we don't have an offer. But after 7 months of no news from the building management, despite a million emails and phone calls, we finally received an email with a date in Jan to discuss the estimates, and a date in March for the Annual General Meeting. This is a GREAT relief, because it seemed very likely that they were going to us (and I know for a fact they nearly did).

So, as of today, we've taken that studio off the market. The good news is that it looks like the building will finally be renovated, and the management isn't dumping us because the case is difficult. The bad news is, it looks like we won't be able to sell it for a while.

So long story short, DH will probably take money out of DS3's college fund to pay for the building renovations, and we'll reimburse that money (as well as 5K we borrowed for the kitchen) to the college fund when we sell it further down the road.

The other studio is still for sale, although there haven't been any bites on that one either. Both agencies are telling us there are no more RE investors here these days, people only want to buy a place they can live in. And unfortunately, both places are rented, with the standard 3 year lease.

How far into the standard three year lease? 

Is there any way you can just hold on and weather the current current cash flow crisis? Where are things at on the accident settlement and IIRC, there is some money younpretend not to have? Maybe this could be the time to look at anything and everything because in less than five years your whole financial picture will be vastly different and probably greatly improved. 

You do do a great job with everything on your plate and this time of difficulty shall pass soon.

[debthaven]

Sarah, that's basically what we're going to do ... try to just hold on. This studio's tenant is 18 months into her lease. Unfortunately, the accident settlement is probably still years away ...

[dee27]

Dec 23, 2016 4:37:43 GMT -5 debthaven said:

Sarah, that's basically what we're going to do ... try to just hold on. This studio's tenant is 18 months into her lease. Unfortunately, the accident settlement is probably still years away ...

Why does the settlement for DH's accident taking so long  ?

[Deleted]

Question for the landlords, is it common to give a month free in a lease? 

The one we signed has January as a no payment January, we actually asked if we could just pay the same amount every month instead (because budgeting) but the landlord wouldn't budge, I think it is because he doesn't want the rent payment to show what the true average monthly rent is, so there is more bargaining power with the higher previous rent with the next renter after us.  Seems rather nefarious..... The landlord also said a no payment January should come in handy for us to pay CC bills from xmas...... I was like yeah, not something we have to worry about.

Also it was very nice last month calling the landlord to deal with it when there were mice instead of having to deal with it ourselves.

[debthaven]

Why does the settlement for DH's accident taking so long

Because the company was uninsured, and we are basically dealing with the government ... They had 5 years to make a settlement and didn't, so it just went to court. Also, nothing could happen while DH was still having surgeries, which was the case up till about 18 months ago.

ETA: A colleague at work had a similar incident, and it took 7 years. We're at 5 ...

[Bonny]

Dec 23, 2016 12:18:05 GMT -5 @aj said:

Question for the landlords, is it common to give a month free in a lease? 

The one we signed has January as a no payment January, we actually asked if we could just pay the same amount every month instead (because budgeting) but the landlord wouldn't budge, I think it is because he doesn't want the rent payment to show what the true average monthly rent is, so there is more bargaining power with the higher previous rent with the next renter after us.  Seems rather nefarious..... The landlord also said a no payment January should come in handy for us to pay CC bills from xmas...... I was like yeah, not something we have to worry about.

Also it was very nice last month calling the landlord to deal with it when there were mice instead of having to deal with it ourselves.

It's not nefarious, it's just a marketing gimmick.

The condo tenant wanted to do that as an incentive to get someone to take over his lease. I actually preferred that over lowering the rent because I wanted someone who could qualify at the higher rental rate and someone who wouldn't have "sticker shock" when the rent increased by $200 in six months when my current tenant's lease terminates. As I posted previously, there is a big seasonal price swing for my unit between winter and summer.

[TheOtherMe]

Dec 23, 2016 12:18:05 GMT -5 @aj said:

Question for the landlords, is it common to give a month free in a lease? 

The one we signed has January as a no payment January, we actually asked if we could just pay the same amount every month instead (because budgeting) but the landlord wouldn't budge, I think it is because he doesn't want the rent payment to show what the true average monthly rent is, so there is more bargaining power with the higher previous rent with the next renter after us.  Seems rather nefarious..... The landlord also said a no payment January should come in handy for us to pay CC bills from xmas...... I was like yeah, not something we have to worry about.

Also it was very nice last month calling the landlord to deal with it when there were mice instead of having to deal with it ourselves.

Last two corporate rentals I did, did that.  The first one called me to see if I would move in 10 days earlier than I had planned and that was "free" as well as the first month. 

I new what it was at the time.

That is not happening in the market I lived in then now.  It's a landlord market now, not a tenant market.

[justme]

Dec 23, 2016 12:18:05 GMT -5 @aj said:

Question for the landlords, is it common to give a month free in a lease? 

The one we signed has January as a no payment January, we actually asked if we could just pay the same amount every month instead (because budgeting) but the landlord wouldn't budge, I think it is because he doesn't want the rent payment to show what the true average monthly rent is, so there is more bargaining power with the higher previous rent with the next renter after us.  Seems rather nefarious..... The landlord also said a no payment January should come in handy for us to pay CC bills from xmas...... I was like yeah, not something we have to worry about.

Also it was very nice last month calling the landlord to deal with it when there were mice instead of having to deal with it ourselves.

Not a landlord, but a previous one always gave us Dec free. It wasn't in the lease though. Even as we traded tenets out (most of the people living there over the years were in college) as long as my friends were there I believe he always did the present.

And he wasn't being nefarious because not only did he not raise the rent over the 6 or so years where at least one original tenet lived there (again as far as I know) when we were talking about signing for the second year he actually asked if rents on the area had went down because he didn't want to charge us more than if we moved.

He was the best landlord.

[countrygirl2]

People and apartments do that also when the market is saturated with rentals.

We are getting calls and calls from people wanting to rent from us, I posted on

the site we won't have any ready till spring and late summer but they still call.

Word is getting around our places are nice, we make sure they are energy efficient,

and we fix things promptly, didn't take long. No one has been late this last year,

a nice batch of renters, hope to get more.

All renters paid on time, have one in Texas that hers varies with when she gets paid

but in over 10 years she has always paid. They are going to buy that lot sometime

this year, I offered it to them. It's in a mobile home subdivision, surrounded now

by high dollar houses near Plano, Texas, a 1/3 acre will bring $30,000. It's

grandfathered or they could never live there so a big deal for them. I told her if

not, its being gifted to our son. I have another lot I sold for $10k with and old RV

on it, paid $600 for the lot and $5k for the trailer to rent and did rent it for a few years.

The prices there have gone nuts, he is down to $2600 and had paid a $1000 in the

last month so working hard to do it. I told him he needs to get it done, with our age

and just an agreement between he and us it would end up in our estate even though

son knows about it. So its best he gets it done.  Sold 4 tiny lots together not even

a 1/3 acre, $25k.  Next this year sell duplex between $160 to $180k, then our of

Texas.

[Sharon]

Nov 23, 2016 20:00:34 GMT -5 Bonny said:

Nov 23, 2016 8:31:43 GMT -5 naughtybear said:

I'm a little confused. Condo tenant was vacating but still be on the hook for the remainder of the lease. Decides to go ahead and stay seeing as he would be paying for the unit anyway? Apart from reneging on moving what is wrong with that. Isn't is preferable to have the condo rented? I assume the original arrangement worked for both parties.

He wants to vacate but only when we find a new tenant. He wants me to continue to market the property but because he won't commit to a move-out date I can't market the property with a reliable lease commitment date. I could get into big trouble and risk a lawsuit if I advertise one date and can't actually deliver as promised.

So he wants out but only if it's convenient for him. I'm not playing that game.

Did this guy ever leave?

[Bonny]

Jan 8, 2017 12:11:15 GMT -5 Sharon said:

Nov 23, 2016 20:00:34 GMT -5 Bonny said:

He wants to vacate but only when we find a new tenant. He wants me to continue to market the property but because he won't commit to a move-out date I can't market the property with a reliable lease commitment date. I could get into big trouble and risk a lawsuit if I advertise one date and can't actually deliver as promised.

So he wants out but only if it's convenient for him. I'm not playing that game.

Did this guy ever leave?

Nope. But he's paid January rent.

We've tried a settlement offer but he's ignored it. This is going to get interesting as the HOA requires a minimum 6 month lease and there's only 5 months left remaining on his lease. We've made the decision that we're going to put it on the "For Sale" market once he's out. We're tired of the tenant BS and it's doubtful that I would move back down to the San Diego area even if something were to happen to DH. I really do prefer it in the SF Bay Area and would probably relocate to a smaller house in the same neighborhood if I could no longer handle the stairs.

[debthaven]

Wow Bonny, I'm surprised you decided to sell the condo sooner rather than later.

Finally, good news on the studio ... no, we don't have an offer. But after 7 months of no news from the building management, despite a million emails and phone calls, we finally received an email with a date in Jan to discuss the estimates, and a date in March for the Annual General Meeting. This is a GREAT relief, because it seemed very likely that they were going to us (and I know for a fact they nearly did).

This finally happened today. DH went to the meeting, I couldn't. They are organizing an AGM in early April to vote for the building reno, the work should start in the fall.

I know it's taking forever but at least it looks like it's finally going to happen. I am SO RELIEVED that the building management didn't us!

At this point it looks like we'll hang onto that studio at least until the building reno is done. Then (depending on when that is), either we sell with sitting tenant in the reno'd building, or we wait a bit longer, give our tenant notice so that she leaves when her lease is up in summer 2018, and sell it empty.

I'm very relieved that things finally seem to be moving.

The other studio (the one we didn't want to sell) is still on the market, zero bites. Both agencies we've been dealing with agree that nobody wants to invest in rental RE here now, they only want to purchase something they (or a family member) can live in.

[Bonny]

Jan 16, 2017 16:25:13 GMT -5 debthaven said:

Wow Bonny, I'm surprised you decided to sell the condo sooner rather than later.

You shouldn't be. My reasons for the investment have changed.

I no longer see myself retiring to that condo. I really don't think I want to live in San Diego anymore. Fun to visit but not live there permanently.

Dealing with an aging apartment and the HOA on top of the usual tenant issues is getting old. I'm reminded of what I would say to folks about buying condos; easier to fire your gardener or contractor than your HOA. It's obvious to me that the complex needs some serious infrastructure upgrades. The HOA is trying to deal with the issues but it's piece-meal and very slow. If this was in single ownership the complex would be gutted over a two year period of time (9 low rise buildings) and done. With 49 separately owned units this is going to take about 10 years. I have better things to do with my time.

The property is probably worth around $700k that's up from the 2008 BPO estimate of $487k. With the loan principle pay-down I will net before taxes around $300k. I've made enough money. I don't need to get greedy.

debthaven said "The other studio (the one we didn't want to sell) is still on the market, zero bites. Both agencies we've been dealing with agree that nobody wants to invest in rental RE here now, they only want to purchase something they (or a family member) can live in."

I will have lost my last three tenants (including the AZ tenant) to them buying a house. This means good credit tenants are buying instead of renting and rents are likely going to be flat. But my expenses (HOA, property taxes, and repairs) are increasing. Unless I'm willing to refi I'm going to having negative C-F again. I can afford it but why? 

[debthaven]

Bonny, that makes perfect sense. It's just that I hadn't realized that you had decided you wouldn't retire there one day (maybe I missed it).

Good luck selling it when the time comes!

[Bonny]

Jan 18, 2017 15:02:51 GMT -5 debthaven said:

Bonny, that makes perfect sense. It's just that I hadn't realized that you had decided you wouldn't retire there one day (maybe I missed it).

Good luck selling it when the time comes!

Post 436 (just above yours ). You were probably in a hurry and just skimmed the post. No harm, no foul. And FWIW it took me several days of some soul searching to make that decision.

[debthaven]

Bonny I saw post 436, but was surprised at the decision since you'd always said you wanted to keep the condo. That's why I thought I had missed an earlier post.

The important thing is that you've taken the time you need and made a decision you are happy with. I'm the first person to agree that things change all the time.