Real Estate Investors

[HarvestMoonOutdoorsman]

I have some big decisions to make with no experience in real estate investments. Anyone on here been doing it for awhile and willing to offer guidance/mentorship? Specifically looking into STR/LTR. Thanks

 

[Beendare]

Did you own STR and now worried about the buyout? I advertise one of my buildings on Costar and am very familiar with it but I'm not familiar with Viper energy the Diamondback subsidiary that bought them out. It doesn't seem like a symbiotic deal to me...but again, I don't know Viper.

I own and have been doing deals in RE for decades....though there are so many segments I wouldn't consider myself an expert in some.

 

[riversidejeep]

35 years of LTR experience here, both my own and for clients. Short answer is it's much more lucrative to make a good buy on a fixer upper, fix, use as principal residence, hold 2 years and sell with zero capital gains. All my rental experience ( personal) is in single family homes, they rent , leave in a couple years, do $20,000 in damage, don't pay the court ordered damages, you repair, wash and repeat. Multi family if managed well seems to work better.

 

[jKsled]

Have oe property managed by me - built out 2 commercial spaces with 2 apartments upstairs. Ran 1 as a STR for several years. Now all long term, lower revenue but more time to focus on family.

I'm no expert but let me know if you want feedback based on that experience ask away.

 

[moewells100]

I'm your Huckleberry. I started with STR, and now own some LTR and commercial properties. Happy to help

 

[Mattt]

35 years of LTR experience here, both my own and for clients. Short answer is it's much more lucrative to make a good buy on a fixer upper, fix, use as principal residence, hold 2 years and sell with zero capital gains. All my rental experience ( personal) is in single family homes, they rent , leave in a couple years, do $20,000 in damage, don't pay the court ordered damages, you repair, wash and repeat. Multi family if managed well seems to work better.

I would second this almost exactly

 

[Bachto]

I have managed single family and multi-family properties for 8 years. We manage 630 doors so I do this at a high level every single day.

Happy to give you my 2 cents on whatever you are looking at doing.

 

[HarvestMoonOutdoorsman]

Much appreciated fellas. I'll be reaching out after the weekend.

 

[TaperPin]

If you can imagine the craziest thing possible, it’s been done by a renter. lol

 

[grossklw]

A lot of it comes in the tenant screening process, I haven't had an eviction in 2 years across 90 units, just hold anything long enough and you'll do fine. Most of my evictions over the years has been inherited tenants that I knew were coming which ultimately led to better deals since I was taking on the headache.

Hard to argue with the 35+ year investor logic of living 2 years and moving on and pocketing it. Just getting started I always recommend house hacking up to a 4 unit with that FHA or 5% down conventional financing, future you will be happy you did that, especially if you rinse and repeat a couple more times while subsidizing your housing costs.

I own a few STR's in AK and on Lake Superior and quite a few LTR in a few different asset types, they each have their pros and cons. Would be happy to handle any specific questions you have.

 

[cnelk]

I do maintenance/repair for 8-10 LTRs for an owner.

I can’t believe how some of the renters beat the crap out of the houses. They just don’t care. They don’t care about cleaning, they won’t take care of the yard and just let stuff go to hell without notifying the owner.

I would recommend that you visit/inspect your investment property quarterly to stay on top of things.

 

[TaperPin]

Rental stories are fun to remember and laugh about.

A friend has a 4 bedroom house down the street rented last year to two guys he works with. 2 months in things are going well until one young healthy guy has a “heart attack” and is dead as a door nail. The other guy can’t make the full rent so stops paying, waits to be evicted, invites 4 ex con buddies to live with him for a few months. Yes a parole officer stopped by. They break off a waterline in the house so for two months there’s no water and they make an outhouse out of one side of the yard. They poured a pee bottle on the furnace control board and in the floor registers, and collected enough junk to fill a 30 yard dumpster. That turn was $30k.

Even better was the time I was a foreman on a crew hired to replace a foundation on an old ranch house outside of town 5 miles. The stripped to the studs house is jacked up, dug out, footers poured and we were stacking ICF blocks when a dude stopped on the highway and was checking out what was going on. I walk over to say hi and see who he was - he actually owned the building and had an informal lease to own agreement with the dude who hired us, but no loan had closed! It eventually worked out for everyone involved - we gave him a good discount for payment that week, but imagine a renter gutting a house without owning it and his finances going south halfway through.

A client has a couple hundred storage units he built on a property that has a 10 year lease with option to purchase. Turned out the dude that owned the land knew it was quite unstable and came up with the lease to own to avoid any soil testing that a loan might trigger. My guy should have done his due diligence. That one might go to court if a longer lease can’t be figured out.

Carpenters have a lot of good less dramatic stories fixing rentals, from fire damage, to cat pee, to an emotional door slammer ruining every door and jamb in the house. lol

The cheaper the rent, the more lax on screening, the more you try to be a “nice guy,” the less you see the property, the crazier the problems. If ever there was a time to be strict about the details it’s being a landlord.

Professional property managers aren’t immune to issues. We’re friends with a ton of multi family property managers and owners of management companies - every year they hear of property managers escorted out of buildings when it turns out unoccupied units were being rented to friends or family, or expenses paid out to vendors were being artificially inflated with a big kickback.

An entire condo association was managed by a crook that funneled inflated repairs and painting to her boyfriend’s company who caused a ton of water damage from incompetence over a ten year period.

We were hired to fix some structural issues at an apartment complex and just watching the behavior of the property manager it made me think there’s something going on. She was well thought of by other managers and cute as a 40 year old can be so the owners loved her, but being on site all day we could see when she wasn’t on best behavior. A year later she was walked off the property for incompetence - turned out she developed a serious drug problem shortly before we met her and she limped along with enough excuses to cover her tracks, but her teeth did all fall out and she needed a sandwich. lol