Monday, October 26, 2009

Even More Renter Drama (or lack thereof)

I have been trying to get in contact with a tenant who was to pay me around the 15th. After several unsuccessful attempts, I asked the neighbor if he'd seen her and he replied, in short, that he thought she had moved out.
I went to the unit. The lights were on, so I called to the house several times with no answer. The tenants across the way were looking through their door and I inquired if they had seen my tenants. The volunteered that they'd helped my tenants move. I checked the gas meter and it was off, and the garage door was unlocked.
I opened the garage door. I looked at all the trash on the floor. At least they left the ladders they borrowed from me, and the paint they were going to use for the trim (that I had provided). I took some pictures, but they didn't upload like I wanted them to. The doors were all locked. I am not one of those landlords who carries keys to all the apartments, and I don't have them master keyed (though maybe I should reconsider that), so I loaded my ladders up and talked to the tenants from across the way.
They, M and J for now, said that my tenant mentioned that she owed money and was moving out. I don't know why she hasn't contacted me. I'm easy to get in touch with, by mail or phone. Someone's got to be able to lend you a phone.
Anyway, it's been quite the month for tenants leaving. One moved out due to moving into a senior park. Another left due to threat of eviction. This one just up and left--I only wish they'd just told me to come and pick up the keys. Another of my tenants is buying a house and I'm the agent and we're hoping to close this week, or early next.

Doorknob Forensics

Okay, the title says doorknobs, but I'm really talking about the entire mechanism, not just the knobs. I'm going to tell you, right now, you can tell a lot about what goes on inside a place, by checking out the doorknobs.

Okay, it's now 10am of the morning after I started that paragraph. Yesterday was a long day. I just spent an hour or so emailing and calling people to deal with a minor glitch.

Doorknobs, handles, strikers, etc. My level of irritation at the moment is ...well...very high. So I went in to rekey the locks of a rental that had been vacated the day before. Usually I do it immediately, but it was one of those days when everything was scheduled and more events popped up, but I wanted to get the keys back from the renter ASAP.

The "man of the house" thought of himself as something of a handyman. He fixed a couple things for me. Things that he or someone in the house broke. I'd spoken to him, the lady, and the kids of the house about slamming doors and security screens. Evidently no one listened. The doors were slammed so much that the striker latches are pretty well worn down. The door knobs came loose and evidently the renter stripped the screws or lost them, because the machine thread screws in two of the eight handles were replace with coarse drywall screws; effectively ruining the handles for future use. The backset inside one of these handles was also broken, which would explain the complaint about the door being hard to open.

Over the last 12 years I've accumulated a lot of locks and pieces. Now I just have to spend the time fixing and wondering about some people's children.

Thursday, October 22, 2009

Coming Opportunities

I got to bed before 10pm last night which was good. I had been unable to sleep the last few nights and had been up until 1pm or later. A couple of the things that were stressing me out are drawing out to their conclusions. I'm not happy with the conclusions, but I'm happy to wrap up the onerous situations. The only way to deal with bad news is head on.

Speaking of 'bad news' there were articles on record foreclosures and the problems in the commercial real estate market in the last week. I was talking with a broker about the coming wave of REO's that would hit the market in CA.

In the article on foreclosures, it talks about people walking away from homes that are upside-down on the equity. It also mentions that banks are not finishing the foreclosure procedures in down markets. I can attest to that.

I was in the sauna at the gym the other day and talk turned to the economy and, of course, real estate, when one of the guys admitted to not having made a payment in about a year and a half. We're in the Inland Empire, a market that has lost as much as 75% of it's equity since the housing market collapse.  It's probably  better for the banks to leave defaulted "homeowners" in the houses as vacant units often get heavily vandalized.

With all that talk, it seems bleak. But on the upside, if you have the money or can get it(are "well capitalized" in industry jargon) you have the opportunity to buy some bargains out there. Furthermore (I love that word), there is talk of extending the $8000 tax credit AND giving it to any buyer (not just first time home buyers).

Don't think this is just generosity on the part of government. If people are willing to buy property at higher prices (and a tax credit makes this possible) than local governments have higher property tax bases to collect from. This allows the county and state governments to finance more of their own expenses without asking for federal money (they will anyway--what governmental agency ever says it can make do with less money). So we may see more opportunities for investors to get a tax break from buying in a down market.

If you're thinking of transitioning from the residential to the commercial rental market, opportunities are just around the corner. As net income is the best indicator of value of a rental, remember to look for hidden costs. The include local taxes and regulation that take their toll on businesses (your new renters) and high utility costs that you may be responsible for (or upcoming rate changes). As commercial tenants are generally responsible for their own maintenance, you can invest across the country.

Saturday, October 17, 2009

I need something like "Dragon think and type"

I find myself wishing for a 'think and write' scanner that I could wear to bed. I have a couple good ideas that bring me to a semi-lucid state every evening and just don't wake up enough to come type them, or write them in the notebook on my side table. I also have a digital voice recorder...that's no use either.
Oh well...just waiting for "Dragon think and type V1.0"...or even the beta.

Sunday, October 11, 2009

The rental is clean.

The one 2 bedroom rental is clean now. I had someone look at it, but evidently she's out of minutes or changed her mind.

Most of the day was spent messing with cars. Sold some of the parts off an 89 Nissan Maxima, and dropped the tanks off an 88 Chevy 3+3 that my buddy Bob and I are building for my brother.

Saturday, October 10, 2009

Beginning of the month--Collecting rent, etc.

It is now the tenth of October. It has been an eventful 10 days. I have been very busy collecting rent, supervising two moveouts, filing my taxes, and complying with local government.

Time are tough and I'm taking partial payments on more than one unit. I've got vacancies that in units that I've never had problems renting before. People have moved out of the area, and developers have new houses that are renting out at $995/month. I've dropped my prices on units that I've spent thousands upgrading. Victor Valley Waste Reclamation Agency has made massive increases on water and sewer fees. On units that used to have a base cost of $80 every two months, I am now paying almost $215, and that's before water usage.

One of the moveouts is still in progress. The people are too far behind to come close to catching up; I've tried to help them as much as I can, but can no longer do so without jeopardizing the property. There is still stuff to be moved out, cleaning and repairs to be done, and I haven't gotten the keys back, but I'm hopeful. An eviction would take about 4 months, and the people are making a sincere effort to move.

Some other renters moved out. They returned the keys on the 6th and were moving some stuff out of the unit. The lady seemed surprised that I was charging her rent until the 6th. She reasoned, "But we weren't even here for the most part," to which I replied, "..but I couldn't use the unit or come in and clean, and you still had keys.." which elicited an "Ohhhhh...I get it".

Her move out brings me to the following. You know how doorknobs are big germ carriers? Well here are some pictures of one of hers. I always rekey my locks between tenants. I do it myself.

The top picture was actually cleaned a little before I took the picture. The second is with a bit of scouring with a 3M pad. The final is everything put back together. You can see the 3M pad underneath. Maybe if I get a request I'll show you how to rekey a lock. I only use Kwikset or Titan locks. There are reasonably priced and don't break after a year like some of the cheaper locks (Bulldog comes to mind).

Finally got the taxes filed. My wife was great. I'm horribly disorganized as far as paperwork goes. I know I missed a couple thousand dollars in write-offs, but last year was so bad, I'm getting back everything I paid in.
Some good news. My accountant only charged me $775.

I've gotten three separate weed abatement notices in the last couple weeks. One is taken care of, two more to go. This is just the short version.

I'm tired and really don't have anything more to say tonight.

Friday, October 9, 2009

Free Dump Day at the San Bernardino County Dump

It's this October 24th. These days are usually very crowded. The dump opens at 7am and the line starts around 630am the last time I went. Dump fees are around $50/ton with the recycling fee. This is good for getting rid of large items that you usually can't get rid of.