The Landlord Thread

[Bonny]

May 27, 2017 11:49:57 GMT -5 zibazinski said:

May 27, 2017 10:54:26 GMT -5 Bonny said:

And on a separate note, I had to post about condo's HOA stupidity and how that's playing out...

So while I was staying at the property, I ran into the HOA PM and the Board President who were doing their monthly walk-through on May 11th. The buildings are getting a new paint job and one of the things they were checking out was areas that still needed to be addressed. They mentioned that there was some issue with my unit's balcony which had been enclosed years before by a prior owner. They said there was damage and that I was going to have to pay for it.  We went around to the back parking/garage area to look but as the area had already been painted and is effectively two stories up I couldn't see any obvious issue. I asked for a copy of the report so I could see what was the claimed damage. I didn't get the report and again wrote to the PM asking for a copy. I still didn't get a copy. On Tuesday, my buyers sent me pictures of the HOA's contractor working on my unit.

I immediately called the HOA PM and asked what was going on? How could the HOA do work on my unit without my authorization or a chance to review the proposed work? Well, it was pretty obvious that HOA F-Ued and didn't follow their own noticing process. The report is dated December 12, 2016.   The PM said she was going to talk to the Board President and I asked that he give me a call. He did and said he's going to recommend to the Board that they pay the bill.

But the story gets better. I sent an urgent e-mail to the PM yesterday basically demanding that I get a copy of the report because I must disclose this repair to my buyers. She sent it and low and behold the "outside contractor" who made the initial assessment is the brother of the folks who live below my unit. These are the people who have made two insurance claims against my insurance. The icing on the cake is that the husband is on the HOA's Board of Directors.

Talk about a conflict of interest!

Of course the brother makes a claim in his report that somehow the dry rot damage from my unit has contributed to a leak in a 40+ old enclosed patio.

So far, I haven't heard about any insurance claims and if they try I will fight them. You can't make a claim six months later after all the work has been completed and not give the other party a chance to investigate.

Unbelievable!

I was thinking that I might need to go to the June Board Meeting but I suspect they will address this matter in closed session. How embarrassing for the Board. The good thing is that if this "fix" by the HOA contractor doesn't work, the HOA owns it.

I've passed the repair info along to the buyers.  Now they'll have documentation in case there's a problem down the road.

You can't make this sh*t up!

Another reason to stay away from HOAS. Someone on the board is always in bed with someone.

I actually don't think HOA and the Director were in collusion. Someone was smart enough to get a bid for the work by another contractor contracted by the HOA. Because that bid came in about $3000 cheaper I'm more worried that the HOA contractor didn't go far enough with the repair work. The issue I had and the reason the HOA is paying for the work is that I didn't get an opportunity to send my own contractor to inspect the problem and make his/her own assessment. It's ironic that this work is likely to get torn out in the next year or so when the buyers replace the windows in this area.

It's a separate issue if the Director submits a claim to my insurance claiming "damage" to his unit based on his brother's opinion without an opportunity for my insurance to inspect the claimed damage and after the work has been completed.

But in both cases the way the matter was handled was poor and gives an appearance of a conflict of interest.

[Bonny]

Appraisal came in at $730k. Salesprice is $695k.

Given that I'm saving $35k in commissions and with the buyers' cooperation with the carry-back I'm saving about $30k in taxes I think we've got a real win-win.

[Bonny]

We got conditional loan approval yesterday. Lender still needs Articles of Incorporation, By-Laws, Budget and Financials for the HOA. I'm at the cabin this week but headed home on Sat. I'll give my copies of the HOA docs to the loan processer (the office is about a mile and a half from my house) which they can copy.

The loan processor says he needs a couple more pieces of paper from the buyers; minor stuff, he says.

One comment that I'll make for the benefit of others; the costs the HOA is sticking to both the buyers and me is astonishing. They are charging me $100 to change the HOA info to the buyer and over $350 to the buyer for the CCR's for the HOA certification + a copy of the CC&Rs. It's another $200 for the documents I'm going to provide. Plus, the insurance agent is charging $75 to provide a copy of the Master Insurance Policy.

These are all items that are in electronic format. What a scam!

[saveinla]

Jun 9, 2017 12:32:31 GMT -5 Bonny said:

We got conditional loan approval yesterday. Lender still needs Articles of Incorporation, By-Laws, Budget and Financials for the HOA. I'm at the cabin this week but headed home on Sat. I'll give my copies of the HOA docs to the loan processer (the office is about a mile and a half from my house) which they can copy.

The loan processor says he needs a couple more pieces of paper from the buyers; minor stuff, he says.

One comment that I'll make for the benefit of others; the costs the HOA is sticking to both the buyers and me is astonishing. They are charging me $100 to change the HOA info to the buyer and over $350 to the buyer for the CCR's for the HOA certification + a copy of the CC&Rs. It's another $200 for the documents I'm going to provide. Plus, the insurance agent is charging $75 to provide a copy of the Master Insurance Policy.

These are all items that are in electronic format. What a scam!

Dont you get a copy of the Master Insurance policy during your annual board meeting? Why not scan that and send it?

[Bonny]

Jun 9, 2017 13:10:52 GMT -5 saveinla said:

Jun 9, 2017 12:32:31 GMT -5 Bonny said:

We got conditional loan approval yesterday. Lender still needs Articles of Incorporation, By-Laws, Budget and Financials for the HOA. I'm at the cabin this week but headed home on Sat. I'll give my copies of the HOA docs to the loan processer (the office is about a mile and a half from my house) which they can copy.

The loan processor says he needs a couple more pieces of paper from the buyers; minor stuff, he says.

One comment that I'll make for the benefit of others; the costs the HOA is sticking to both the buyers and me is astonishing. They are charging me $100 to change the HOA info to the buyer and over $350 to the buyer for the CCR's for the HOA certification + a copy of the CC&Rs. It's another $200 for the documents I'm going to provide. Plus, the insurance agent is charging $75 to provide a copy of the Master Insurance Policy.

These are all items that are in electronic format. What a scam!

Dont you get a copy of the Master Insurance policy during your annual board meeting? Why not scan that and send it?

I can't recall ever seeing a copy of the Master Insurance Policy, perhaps there's a certificate of insurance? The Master Policy is generally a huge document to be included in every packet. Lender wants a copy of the policy not just the certificate.

And in any case it wouldn't apply in this situation. Association just switched insurance companies 6/6.

[TheOtherMe]

Total scam.  Glad when I sold my last condo they didn't charge all those fees. 

[dee27]

Ouch, Bonny! Our HOA provides the copies for the buyer for $75, but I don't know about the lender's requirement. Our association bylaws require that the buyer deposit 2 mos. of HOA dues at closing. Since condos are regulated by the state as well as the local association, I can understand how there would be some surprising costs for selling a condo that are different from selling a house. However, your quoted prices seem high! Also, since the documentation requested by the lender is available on-line, why can't the lender accept the link and temporary password if needed especially since most banks have the buyers sign electronically and use an I-pad at closing. The buyers receive a disc of the closing papers.

[Bonny]

Jun 9, 2017 22:21:33 GMT -5 dee27 said:

Ouch, Bonny! Our HOA provides the copies for the buyer for $75, but I don't know about the lender's requirement. Our association bylaws require that the buyer deposit 2 mos. of HOA dues at closing. Since condos are regulated by the state as well as the local association, I can understand how there would be some surprising costs for selling a condo that are different from selling a house. However, your quoted prices seem high! Also, since the documentation requested by the lender is available on-line, why can't the lender accept the link and temporary password if needed especially since most banks have the buyers sign electronically and use an I-pad at closing. The buyers receive a disc of the closing papers.

Agreed total scam.

And we haven't talked about the Move-In fees they will charge for x-fer; $150....to move across the hall. Supposedly this is to cover the cost of painting the scratches and marks made when moving. Last month was the first time during my nine years of ownership that I saw any painting done.

Yep, not going to miss that part of owning the place!

[dee27]

It seems your HOA board is over the top and not in a good way. Have a glass of bubbly at closing and be thankful the condo is gone.

[justme]

Geeze and people think my condo is crazy.

[zibazinski]

That's why I was not going to buy in a HOA.

[raeoflyte]

Jun 9, 2017 13:10:52 GMT -5 saveinla said:

Jun 9, 2017 12:32:31 GMT -5 Bonny said:

We got conditional loan approval yesterday. Lender still needs Articles of Incorporation, By-Laws, Budget and Financials for the HOA. I'm at the cabin this week but headed home on Sat. I'll give my copies of the HOA docs to the loan processer (the office is about a mile and a half from my house) which they can copy.

The loan processor says he needs a couple more pieces of paper from the buyers; minor stuff, he says.

One comment that I'll make for the benefit of others; the costs the HOA is sticking to both the buyers and me is astonishing. They are charging me $100 to change the HOA info to the buyer and over $350 to the buyer for the CCR's for the HOA certification + a copy of the CC&Rs. It's another $200 for the documents I'm going to provide. Plus, the insurance agent is charging $75 to provide a copy of the Master Insurance Policy.

These are all items that are in electronic format. What a scam!

Dont you get a copy of the Master Insurance policy during your annual board meeting? Why not scan that and send it?

The lender would need the new loan/buyers listed on the master insurance for the loan, so the existing copy while helpful for contact info won't replace the new one. 

I've never seen the insurance company charge for that, although it may be on the hoa side.  

[dee27]

Bonny,

The higher fees, that our HOA incurred, happened because the former president was phoning in "his" responsibilities and not relying on the board to make decisions. Instead of the HOA getting bids or making copies, he was calling the management company to do the work, and we paid outrageous fees for the work. Plus the management company was understaffed, poorly trained, and had a high rate of employee turnover. Those practices stopped when he was not re-elected. Your HOA could be deferring to the management company and that is why the fees for services are so high.

[countrygirl2]

Got our last rental in Texas up for sale, hope the thing sells, neighborhood not very appealing. 

To bad its a really nice property.

[countrygirl2]

Yep its been peaceful at our rentals, all have new roofs, new or newer heating systems, water heaters fairly new

so hope not to have calls.

On his mom's house he put in a new water heater, being proactive. The AC quit and he just knew he needed

a new unit, but they fixed it yesterday. I don't know when we will ever get that place done, keep having to

stop to do this or that or help people or something. But ours are in good shape when put up for rent.

We have one his dad had that needs work, but it does have a good metal roof and I put in a new furnace

and AC 2 years ago, just needs cosmetic stuff.

[Bonny]

The condo finally closed on Tuesday.  Took nearly two months but I got a good price and I feel like I sold it to the right folks and drum roll....we're still friends!

Had to run down to So. CA again on Wednesday and just returned now so this is the first opportunity to update. Although the primary purpose of this trip was to attend a 60th birthday party for a friend we also spent some time with my father. He and his girlfriend are reaching a point that the up-keep of their home is getting to be too much for them. DH would like to buy it.

For a lot of reasons I don't think this situation will work but I have to give credit to DH for wanting to help them out. Stay tuned for another chapter of "As Bonny's Real Estate World Turns".

[Anne_in_VA]

We saw a 3 bd, 2 bath ranch foreclosure around the corner from us selling at a huge discount and I want DH to go and see it.  From the online pix it looks like it wouldn't be too much to fix up and rent out.  We'd need to paint, replace flooring (would obviously use laminate) and update the bathrooms.  The kitchen doesn't appear to be in too bad shape.  I think the cabinets would need paint and hardware plus some newer appliances.  With a mortgage of less than $900 and rents around $1400, I think it might be worth looking into.  He's thinking about it.

[bean29]

We were intrigued by a house in the next city over. All brick, 3 car garage, river access or views (wetlands between lot and river, but not buildable). House needed at least a partial roof repair, new windows, paint, and serious remodeling. It was about 4,000 square feet, but rooms & closets were small. Neighboring houses didn't seem as nice. Taxes were high. I just said NO. It also needed a new driveway and a new patio. I will stay put, continue to declutter and do repairs on existing house.

[countrygirl2]

A lot of laminate doesn't last well in rentals, check it out. We have one we bought with laminate last year, we

knew we would have to replace it. Plan on it later this year. It was cheap and used in the kitchen and

bathroom, of course ruined in wet areas pretty quick. There is some that is sort of like stone I had in my

kitchen in Texas, very durable. Also we are going to use the new vinyl or rubber kind that looks like boards

supposed to work in wet areas.

[countrygirl2]

We are thinking of going to the big carpet squares that can be pulled up and replaced, also will save the

cost of having it installed. In cold areas really need something like carpet on the floors.

[countrygirl2]

One of our renters had her house broke into yesterday. They bent
and broke a couple of screens trying to get windows up. They
couldn't so took a brick and broke out the double glass in the
back steel door. DH went and got a new insert yesterday and
fixed it.

They also tried prying open the door on the shed she has her
daughters 4 wheeler in.

She had prescription drugs for back issues, like I do and I'm
sure they got those. Don't think they took anything else.

Had a lot of thefts around here lately. Makes hubs and I leery
about leaving for long anymore.

[Bonny]

Think I just dodged a bullet when I sold the condo to my neighbors without telling my brother.

I talked with him today (it's my birthday) and I let him know that I sold it. He wasn't very happy. He said I should have let him know. I asked him why. He's claiming it's because he would have liked to have said "Goodbye". I find it really ironic given that he let the family house get foreclosed on. That was a house my parents owned for over 30 years. My mom owned the condo for four and my husband and I owned it for 9.

I think the real reason is that he is in the market for buying a house in Orange County. He claims his credit is back up to 750 (I find that very hard to believe given his past financial problems). I know that if I had let him know about it before hand he would have made a play to buy it and try to guilt me into a family discount. And you know that I would hear about every problem he had with the unit.

Whew!

[Works4me]

Aug 10, 2017 16:44:45 GMT -5 Bonny said:

Think I just dodged a bullet when I sold the condo to my neighbors without telling my brother.

I talked with him today (it's my birthday) and I let him know that I sold it. He wasn't very happy. He said I should have let him know. I asked him why. He's claiming it's because he would have liked to have said "Goodbye". I find it really ironic given that he let the family house get foreclosed on. That was a house my parents owned for over 30 years. My mom owned the condo for four and my husband and I owned it for 9.

I think the real reason is that he is in the market for buying a house in Orange County. He claims his credit is back up to 750 (I find that very hard to believe given his past financial problems). I know that if I had let him know about it before hand he would have made a play to buy it and try to guilt me into a family discount. And you know that I would hear about every problem he had with the unit.

Whew!

You definitely dodged that bullet!

in addition to selling itnto him well under market, he probably would have expected you to carry at least part of the loan. He'd fail to pay and eventually you'd have to foreclose on him. Then you'd have to reprint and repair the place, replace the appliance, and thenflooeing before you could re-sell.

Yep, major bullet dodged! 

[Bonny]

Aug 11, 2017 3:17:14 GMT -5 Works4me said:

Aug 10, 2017 16:44:45 GMT -5 Bonny said:

Think I just dodged a bullet when I sold the condo to my neighbors without telling my brother.

I talked with him today (it's my birthday) and I let him know that I sold it. He wasn't very happy. He said I should have let him know. I asked him why. He's claiming it's because he would have liked to have said "Goodbye". I find it really ironic given that he let the family house get foreclosed on. That was a house my parents owned for over 30 years. My mom owned the condo for four and my husband and I owned it for 9.

I think the real reason is that he is in the market for buying a house in Orange County. He claims his credit is back up to 750 (I find that very hard to believe given his past financial problems). I know that if I had let him know about it before hand he would have made a play to buy it and try to guilt me into a family discount. And you know that I would hear about every problem he had with the unit.

Whew!

You definitely dodged that bullet!

in addition to selling itnto him well under market, he probably would have expected you to carry at least part of the loan. He'd fail to pay and eventually you'd have to foreclose on him. Then you'd have to reprint and repair the place, replace the appliance, and thenflooeing before you could re-sell.

Yep, major bullet dodged! 

Yep, that's exactly what he would try to do.

In talking with him yesterday he claimed he was going to buy a lot in Dana Point and put a modular home on it "because the HOAs can't stop you".

Back in 2008 after my mom died and we were dealing with her two pieces of real estate he made comments like that about the condo board being unable to keep us from doing vacation rentals with the condo and another comment about how he was going to move into the 2 br 55 and older little rental house (he was 50 at the time) with his wife and five kids. Sure no one would notice that going on, especially my mom's cranky 75 y-o boyfriend who lived in the other half of the duplex.

Yeah, sign me up for that strife!

[debthaven]

I'd like your opinion please. 

We had two studios for sale. Both are rented so they can only interest investors.

We took one off the market because the building is in bad shape and the new realtor we wanted to hire says we need to wait till the building is renovated to get a decent price.

The other isn't moving either, although there has been some interest with the latest price drop. We are currently in negotiations with a couple but they won't go higher and we won't go lower. So, stalemate. (We're hoping they go up but not counting on it.)

That agent suggests listing on a website for private parties (ie no agents). The tenant is GREAT.  We are concerned about the volume of traffic listing on that site MIGHT generate. I may be worried about nothing but I fear getting people who are just curious but don't want to buy.

So I'm thinking, we should ask the tenant what he'd prefer: either one or two "open houses" and/or for us to give the potential buyers his number (once we've done due diligence to do our best to weed out the kooks). I'm also thinking of telling him, if we DO sell through that website, we will compensate him for his trouble (ie give him one month's free rent)

Part of the issue is that I know he prefers to have visits on Sat mornings. DH is never available on Sat mornings, and I prefer not go on my own. Also, since it's a studio, it looks more spacious with fewer people in it.

What are your thoughts on giving the tenant the option (ie either an open house or two and/or scheduling viewings at his convenience), and offering him compensation (we're thinking one month's rent) for his trouble IF it sells through that website?

Thanks!

[Bonny]

Nov 11, 2017 14:26:45 GMT -5 debthaven said:

I'd like your opinion please. 

We had two studios for sale. Both are rented so they can only interest investors.

We took one off the market because the building is in bad shape and the new realtor we wanted to hire says we need to wait till the building is renovated to get a decent price.

The other isn't moving either, although there has been some interest with the latest price drop. We are currently in negotiations with a couple but they won't go higher and we won't go lower. So, stalemate.

That agent suggests listing on a website for private parties (ie no agents). The tenant is GREAT.  We are concerned about the volume of traffic listing on that site could cause. I may be worried about nothing but I fear getting people who are just curious but don't want to buy.

So I'm thinking, we should ask the tenant what he'd prefer: either one or two "open houses" and/or for us to give the potential buyers his number (once we've done due diligence to do our best to weed out the kooks). I'm also thinking of telling him, if we DO sell through that website, we will give him one month's free rent for his trouble.

Part of the issue is that I know he prefers visits on Sat mornings. DH is never available on Sat mornings, and I would rather not go on my own. Also, since it's a studio, it looks more spacious with fewer people in it.

What are your thoughts on giving the tenant the option (ie either an open house or two and/or scheduling viewings at his convenience), and offering him one month's rent for his trouble IF it sells through that ad?

Thanks!

What's the law in France for tenant notice?

In CA it's 24 hour notice although I personally lowered the rental rate (about 10%) in order to get notice down to 2hrs.

Back when the market wasn't so hot, it wasn't uncommon to have an open house for a tenant occupied property although now almost everyone has the tenant vacate, paints, fixes up and stages the property. Since things sell multiple offer and escrows are closing within 45 days, sellers seem o.k. with the process.

This seems like a really bad time of year for you to have the property on the market.

[debthaven]

DH flat-out refuses to get rid of the tenant, so like it or not, that is not an option.

Otherwise legally it's six months' notice before his 3-year lease expires in two years.

So again, not a consideration. DH feels VERY strongly that if we bought it with him in place (and we did, plus he's done an amazing job both in the the studio and in the small garden), it's unethical to kick him out.

ETA: It's been on the market since last Dec. It's finally started getting some interest since the second price drop in late Sept.

ETA2: Ironically, the people we have been negotiating with are good friends with the PM ... the PM found out the place is for sale when I asked her for docs for the RE agent who had two visits that didn't result in an offer. So, they'd save on the agency fees, but they want more, and we won't go down any further. 

I thought it was strange when the PM asked me what our price was, until I got a call the following week from a woman who claimed to be the PM's best friend. I'm sure the PM is "coaching" her. We are not in a rush but we won't go any lower, and it's possible we could get more through this website. In any case, I'd like to try. 

Ideally we would have preferred to sell the other studio but given the state of the building, that's not going to happen anytime soon.

[Bonny]

Nov 11, 2017 14:46:44 GMT -5 debthaven said:

DH flat-out refuses to get rid of the tenant, so like it or not, that is not an option.

Otherwise legally it's six months' notice before his 3-year lease expires in two years.

So again, not a consideration. DH feels VERY strongly that if we bought it with him in place (and we did, plus he's done an amazing job both in the the studio and in the small garden), it's unethical to kick him out.

ETA: It's been on the market since last Dec. It's finally started getting some interest since the second price drop in late Sept.

ETA2: Ironically, the people we have been negotiating with are good friends with the PM ... the PM found out the place is for sale when I asked her for docs for the RE agent who had two visits that didn't result in an offer. So, they'd save on the agency fees, but they want more, and we won't go down any further. 

I thought it was strange when the PM asked me what our price was, until I got a call the following week from a woman who claimed to be the PM's best friend. I'm sure the PM is "coaching" her. We are not in a rush but we won't go any lower, and it's possible we could get more through this website. In any case, I'd like to try. 

Ideally we would have preferred to sell the other studio but given the state of the building, that's not going to happen anytime soon.

Let me clarify my earlier post.

I meant what is the legal requirement in France to give tenant notice to show the property?

I don't think it's ironic that the PM's friend is interested in the place. The property has been on the market for a long time from US standards. In marketing lingo we would say the property is shop-worn, hence the low-ball offer.

Personally I'd pull it off the market and re-list it again at the new low price next year.

ETA: Regarding the tenant, is he paying market rate?

[debthaven]

OK, got it, sorry. I'm not sure. He has always been extremely cooperative so I've never needed to look into it.

The PM is not the RE agent, not the same company ... so the PM may not be aware that it's been for sale that long. She seemed surprised when I asked her for those docs for the RE agent.

Yes he is paying market rent.

It was taken off the market over the summer for two months before being relisted at the lower price at the end of Sept.

[debthaven]

Update ... that initial offer didn't work out. We received a slightly better offer from someone else on Sat, and we accepted. It takes about 4 months to close here, so it will be a while. But I think it will work out. We are very happy and relieved.