On Becoming a Landlord
I am seeking advice and insight from people who have had experience owner occupying units in a townhouse/being landlords in nyc. Putting in offers on 3 and 4 family brownstones in Harlem. Will occupy the lower duplex and rent out the other units. One of the renters will be a trusted family member. The other…
I am seeking advice and insight from people who have had experience owner occupying units in a townhouse/being landlords in nyc. Putting in offers on 3 and 4 family brownstones in Harlem. Will occupy the lower duplex and rent out the other units. One of the renters will be a trusted family member. The other unit(s) will need to find tenants. The rental income will be crucial to being able to afford the property. Thanks in advance for your input and sharing your experience on any of the below questions.
Costs
-How many months worth of mortgage payment reserve is wise?
-On a new renovation, given a solid engineer report, how much should we have saved for “just in case”
Finding Tenants
-Vacancies-How long should we
expect it to take to find tenants. Where have people been most successful-friends of friends/craigslist/broker?
Other than credit check, deposits, meeting the people and getting a feel for them, what to look for to (as best as possible) avoid payment issues and other “drama.” I have heard so many horror stories about how hard it can be to evict people.
Managing Tenants-what should we expect in terms of time commitment
ejalbk,
check out the Brooklyn yellow pages,
A Final Cleaning Solution
is one company.
There are a few out there,
if you pick up the free weekly papers
in the supermarket, there is a section
in the back of the paper for professional
services, they advertise in there all the
time.
quote:
Better to rent to an unemployed drunk with a credit score of 800 than a friend
wow, just wow. some of you people are serious bonkers in the hdad.
*rob*
Legion…can you recommend any of those $49 plumbers you mentioned??
Rob — a landlords can’t “snoop” unless they get permission from the prospective tenant to perform the credit check.
1- NEVER rent to friends, family or friends of family. I never had a problem with a renter from any other source. I’ve done this a half dozen times with a 50% fiasco rate. Better to rent to an unemployed drunk with a credit score of 800 than a friend or relative unless you shared 50% of your genes with that relative.
2- Don’t rent without a credit report. Even if they have a 600 or worse, they know that you can even make it worse if they don’t pay you.
3- Move that apartment quick if it is ready to rent. You are running afruit and vegatable stand. Once a month comes and goes, it is gone and rotten.
one day the law will change where PRIVATE landlords won’t be allowed to SNOOP into peoples bank accounts and credit scores… yes that day will come.
*rob*
yeah, substitute trustworthiness for trustworthyness.
my spelling sucks. but then I don’t get paid for spelling anyway.
Landlord wisdom:
-get to know a good and honest plumber, water is your main enemy as an owner, it leaks through roofs and ceilings, it backs up in the basement, it stops up in the toilet and under the sink. Better yet, get to know the basics of home repair for plumbing. Buy an electric snake for the inevitable clog or have the number of a handyman available.
DO NOT call large name companies for basic clogs, Roto Rooter for instance will charge you $350.00 for unclogging a tub drain, when you could have simply unscrewed the drain strainer and gone in with a small snake for 15 minutes to solve the problem.
Get a contract with one of those $49 dollar sewer main cleaning services. Make sure they come in at least once a year. The sewer main in the basement can clog easily from roots or debris over time. You don’t want to come home to a sewer main backup and the thousands in clean up when you could have paid $49 dollars once yearly.
-electrical, don’t play around with it. get a to know a licensed electrician. Usually not a big deal in properly wired houses but older houses always have their electrical issues since every tenant wants to re-create an IMAX in their living room.
-keep a buffer between your tenants and yourself. Don’t give them your private number. Give them a number to an answering machine. Don’t get too friendly, it’s a business not a frat house.
-As far as selecting tenants, I have found a direct correlation between credit score and the tenant’s trustworthyness for payment. I haven’t had a tenant with a score above 700 give me a problem. They seem to understand responsibility and the need to preserve their good credit.
You don’t want to play at being some deadbeat’s daddy/mommy and teach them the improtance of responsibility. No time.
-keep reserves available for vacancies and renovations. keep a credit card with a decent credit limit just for emergencies like heating or plumbing or electrical.
-regarding heat, better to keep the place at a warm level in winter than to endure the constant whining about cold rooms and drafts. besides, attempting to bring the temp. down to the legal 55 during the evening only taxes the heating system when it comes back on in the morning. Keep thermometers in the hallways to allow tenants to check for themselves that it is not 42 degrees in the building when they call you.
-craigslist is a good source of tenants.
-don’t be afraid of evictions. Just get to know the guidelines and standards. go by the book everytime. don’t deviate and use third parties for all communications with documentation. Although the prevailing wisdom is that tenants can get away with murder, in truth they can’t, they might get away for a few months of not paying, but in the end they will be evicted and have an eviction on their record. You can check for court cases in your credit evaluation of the patient. Remind the tenant that an eviction will be on their record and most good landlords now have access to such information.
Good Luck
Trust people. Do not assume that everyone is out to get you; maybe if you do, they will (karmic). Not to say you won’t have the occasional bad tenant, but follow your instincts and you’ll probably do well. Why do so many people hate family members here? On my block, half the LLs have friends or family members as tenants.
My previous 2 tenants were from Craigslist and both both worked out great; both moved when they became pregnant. Current tenant is son of a neighbor. I have no qualms.