Tired Landlords - Posted by Rebecca

Posted by Jimmy on November 11, 2007 at 04:35:28:

  1. 20% of my rent is Sec 8. I am not a slumlord, but am a coupel clicks above that. still very low on the Socio-economic scale. people can buy nice houses for 65K in my areas, so anyone making $20 an hour is a homeowner.

  2. I like clusters of contiguous houses/duplexes/3-4 plexes. I get better control that way.

  3. the props need to have good bones before I will bother. is it worth saving? if I but it for x and put y in it, will it be worth considerably more than(x+y)?

  4. the 215K deal was strange. it was the ONLY rehab cluster deals I ever did that was a listed deal. lady died. kids did not want to deal with the props. they were asking 375K. and if they had been more patient, and sold them one at a time, they would heva gotten a lot closer to their desired price. been on market for 9 months. I threw them a 215K lowball and held my breath, waiting for the counter or a nasty silence. but noo. I got an acceptance within 5 minutes. [I should have offered 195K !!]

  5. as for managers, here’s my secret. I don’t use management companies (aka realtors). Realtors make the worst managers. here’s why: realtor can manage tenants, but realtors cannot manage properties. and there’s a big difference. All 5 of mine are construction types that I recruited. I teach them how to handle leasing, evictions, collections, etc. They already know how to see problems and issues.

Tired Landlords - Posted by Rebecca

Posted by Rebecca on November 08, 2007 at 20:14:55:

What is the best way to contact tired landlords? please I am interested in contacting them if you could help me please I wish you all success Thank You

Re: Tired Landlords - Posted by M. Osterman

Posted by M. Osterman on November 10, 2007 at 16:28:18:

A title company or a data service like dataquick will provide you with a list. I market to “absentee owners” you may want to consider asking for a list that contains landlords who bought their houses several years ago. This will eliminate houses that don’t have equity.


I’ll Share One Secret - Posted by Jimmy

Posted by Jimmy on November 10, 2007 at 05:00:02:

ok two. here are my #1 and #2 sources of cluster rehab deals…ready…drumroll…

  1. FSBO ads in the local newspaper. not my ad. ads placed by sellers. every morning, I read the RE classified ads in about 12 newspapers. takes 10 minutes and can be done online and free.

  2. housing directors. get to know the directors of all the housing agencies that cover your turf. they work with hundreds of local landlords, and often know who wants out. [this works perfectly for me, as I focus on lower income areas. and that’s the clients that housig agencies serve.]

Re: Tired Landlords - Posted by Chad

Posted by Chad on November 09, 2007 at 17:34:53:

My opinion is that tired landlords are an excellent source. I haven’t done that many deals yet, but most of them have been from tired landlords.

From my experience the investor has what he or she considers a problem property – it’s in a part of town away from their other properties, or they get a bad tenant who doesn’t pay rent. Whatever the reason they are sick of it and want to get rid of it. Would it make sense for them to fix it up and sell or rent? Of course. But they just don’t want to deal with it anymore.

As far as how to get leads, I’ve found that most investors are very secretive; they’ve spent a lot of time and effort developing methods that work, and they don’t want to reveal them so easily.

Re: Tired Landlords - Posted by DJ-nyc

Posted by DJ-nyc on November 09, 2007 at 14:30:19:

Take a Landlord tenant attorney out to lunch. Great referral source. Sit in Landlord tenant court for a couple of weeks. Loaded with tired landlords.

I am finding deals now from my apartment ads talking to prospective tenants who are leaving the “tired landlord”. My question is: Do you have the name/number for your previous landlord? :slight_smile:


Re: Tired Landlords - Posted by george

Posted by george on November 09, 2007 at 10:51:59:

Sorry if I’m not responding directly to your question, but I have to cringe when I see inexperienced investors advertising for “tired landlords.”

The thinking is that these are motivated sellers and will therefore give you a super bargain. Unfortunately, what appears to be a bargain can turn out to be a nightmare. There is always a deeper reason than the landlord just being tired of the property and wanting to unload his little goldmine.

And a fresh face always looks at it optomistically with youth not being tired, with skills that can improvement management, etc, etc.

Rarely does this work out. I have seen properties passed from tired landlords to buyers who become tired landlords to buyers who…for several generations, with each having a sour taste in their mouth, and many leaving RE investing all together.

IMO, tired landlord properties are the worst source to buy properties. But this is just my opinion.

A tired landlord who bought another tired landlord’s rentals.

Shortcuts - Posted by Jimmy

Posted by Jimmy on November 09, 2007 at 05:03:54:

people repeatedly make postings here, looking for shortcuts to find distressed and other motivated sellers. Why not do it the old fashioned way? Get out there and find them.

I don’t run ads or use bandit signs to find deals. I have many contacts in my favorote investing areas. My contacts refer deals to me all the time. I built the network of people over time. You can do the same.

and when I get called into a situation, I have credibility, precisely because of the referral source.

Re: Tired Landlords - Posted by Eddie FL

Posted by Eddie FL on November 08, 2007 at 20:46:24:


You can go to the CH and look up evictions and send a postcard or a letter to the Landlord that is doing the eviction.

Good luck,


Re: I agree - Posted by Chris

Posted by Chris on November 11, 2007 at 06:05:30:

I agree, I live in central NY, I own low income rentals, and unless you’ve got the skill and your OWN tried and true system your done before you start. Low income rentals are not for the faint of heart. They need to be managed with an iron fist, in fact there isn’t a management co. around here that can do the job. We have made it work because #1 it’s my FT job, #2 I come from a long line of very successful contractors and have been brought up in the biz and have contacts with subcontractors and suppliers and can get theings done timely and reasonably, not something a “newbie” could step in and do and #2 we have a management system that borderlines a nazi regime. That may sound a bit much but no less will make you a tired landlord yourself. No pays get their three day on the 2nd NO EXCEPTIONS! With a section 8 and county programs riddled with corruption, and 90% of tenants are on some sort of assistance, you better know the system and be willing to make as many calls as it takes and talk to as many case workers as it takes to get your money.

I’m not saying it’s not a great way to build wealth, it’s just not for everyone and I certainly wouldn’t recommend a “newbie” go anywhere near it. Just like working with owner occupants facing foreclosure and being there “problem solver” wouldn’t suit me. (not much of a people person) However I do recognize there are people out there doing it and making a great living and really contributing. Not everything is for everyone.

Now Hold On There, George - Posted by Jimmy

Posted by Jimmy on November 09, 2007 at 13:30:44:

I have made a career out of buying up clusters of beat-to-sh!t properties, renovating them, upping the rents, and holding them indefinitely. and I relieve my landlord sellers from their burdens.

but there is an art to doing this profitably. and there is a scientific way of eliminiting the landlord headaches.

  1. The Science of Landlording. DON’T !!! I have managers handle the tenants and the properties. I manage the managers. and when a manager is not performing to my expectations, I chop off her head and find a new one.

  2. The Art of the Deal. a combination of factors contribute to protifable deals. chief among them is buying in situations where I have little or no competition from other buyers. and I intentionally buy major rehab projects. I don’t want nicely maintained properties, because the numbers are inferior to what I can create with junky props. and I never want new properties, for the same reasons.

all of this is worthless if I did not possess the skills and experience to run this biz.

in other words, a great opportunity can be losing proposition in the wrong hands.

OK sounds good but … - Posted by Redline

Posted by Redline on November 11, 2007 at 24:24:21:

Do you buy properties in marginal areas? You can have great management but those areas will only attract certain renters, no matter how nice you make things and no matter how much you screen you always get slow paying tenants who tear things up. After you go through several management companies - what then?


Re: Now Hold On There, George - Posted by george

Posted by george on November 09, 2007 at 16:40:40:

If you’ll notice I said this is not the route for “beginning investors.” I noticed you associate tired landlords with junker properties.

Yes, there is a market for guys like yourself, as well as slumlords. Otherwise properties would sit and eventually be bulldozed under. I agree that these are for people with the knowhow to turn a buck out of them.

What I am saying is that the average beginner has a low chance of survival if he starts out chasing tired landlord properties. Inheriting someone else’s headaches to become your headaches is a very discouraging route to take. There are other profitable ways of creating wealth without having to deal with these problems. Ask me how I know.


I was a Beginner Not Too Long Ago. - Posted by Jimmy

Posted by Jimmy on November 10, 2007 at 04:54:41:

I WAS a beginner in 2000 when I started in REI. I wandered around and did a number of different investment activities. but one deal in 2003 opened my eyes REALLY BIG, and I saw the proverbial flaming arrow pointing to my future.

fyi: here was the deal. bought 10 properties in need of a lot of work for 215K. rents around $3900. did 85K worth of rehab work over next 9 months. got rents up to $6700. did refi. appraisals came in at 485K. WOW!! did a 70% loan and got 340K. that meant I had an extra 40K in my pocket. and my rents were 2.2 times my loan payment ($3050–and that’s a 15 year am).

since that deal, I search really hard to find cluster rehab deals. and I find them.

and part of the beauty of what I do is this: the activity is repeatable and sustainable. there is no limit to how many deals I do. eash deal makes the next deal easier to get done. because my cash flow improves and my cash position improves.

its a great country. !!!

Re: Now Hold On There, George - Posted by LeonNC

Posted by LeonNC on November 09, 2007 at 21:45:16:


How do you know?


Re: I was a Beginner Not Too Long Ago. - Posted by LeonNC

Posted by LeonNC on November 10, 2007 at 15:24:07:

In my area a house that rents for $670 is worth about $74k. My calculations tell me you bought these houses at $.40 on the dollar and are getting about $200 a month cashflow on each. That’s definetely a landlords dream.

I know a guy who did it one by one for the last seven years and now has fifty. I sold him four I believe. He says he’s created a monster. I don’t know how he does it.



Re: I was a Beginner Not Too Long Ago. - Posted by Dean in NC

Posted by Dean in NC on November 10, 2007 at 07:31:03:

Do you do commercial loans for your re-fi’s? I did a similar deal (much smaller though) by purchasing 5 low end houses on a dead end street and trying to bring the block around. I’m leaning towards doing more of these sec 8 so I don’t have to track people down for my rent.

Re: I was a Beginner Not Too Long Ago. - Posted by Ed in Idaho

Posted by Ed in Idaho on November 10, 2007 at 07:14:18:

Hi Jimmy! Just printed out your posts above to add to my RE bible, love what you say 99% of the time. (Saying 100% would be kissing up too much) I totally agree with the ‘wrong hands’ statement. I’ve seen many businesses I think I could double their profits by adding a little of this or that and doing something a different way, if I felt passionate about that business. I see where RE is no different in the broader picture.

When you buy your clusters, how low income is ‘low income’? Do you do alot of ‘section 8’ or try to stick with the ‘bread and butter’ type homes of the working class? And do you try to hold all of those houses in your cluster or just pick the best and dump the rest? Just curious. I’m heading down ‘rehab road’ now and trying to find the ‘secrets’ others use in this competitive business.

What do you see when you look at these houses? Do you have a major tip on that one? What I mean is :What is the FIRST thing you see or look for? I’m trying to get those ‘eyes’ that see the deal when I see it. I know they are just numbers, but getting 10 houses for 215k around here would be a miracle, and 85k or average 8.5k into each one would not even be ‘major’ rehab. I know, Iknow, adjust the numbers to your market.

I do appreciate all of yours and others advice on this forum by just reading your posts! If you are too busy, don’t worry aboout my questions. They will be answered in other posts eventually. The latest gem of yours, not original but makes the light bulb go off, is when you said to ‘Manage the managers’. I love that saying and will move heavily towards that goal. I know we posted a while ago about never being able to be a ‘big enough a$$hole as a landlord’, but even that can be tiring. Thanks for your wisdom! ED

Re: I was a Beginner Not Too Long Ago. - Posted by Jimmy

Posted by Jimmy on November 11, 2007 at 04:24:09:

yep. all my loans are commercial blanket loans, with 8-10 properties n each loan. about 21% of my rent is Sec 8. been as high as 45% and as low as 10%. can’t rely on Sec 8 to always be there