Questions To Ask Agent And Tenants At Viewing?
Hi Everyone,
I have made offers on several multi-family homes (4-units) and came up empty handed so far because they didnt want to counter offer and play "Lets Make a Deal" with me. But I am keeping positive and will find a motivated seller that will come to a happy medium with me to where I will have a positive cash flow every month and they will walk away happy too.
When I view a multi-family I have questions to ask the RE agent and the tenants to see if this property will be a good deal for me. Here are questions that I ask, can anyone please let me know if these are good questions to ask or if there are others I should be asking to get a better feel for the property:
1) Are there separate meters for utilities?
2) What type of air, is it forced?
3) Who pays for the utilities and what are the costs?
4) Is there a laundry setup? I would like to setup a coin-op if there is none.
5) How is the trash handled?
6) Who maintains the yard when it comes to moewing the grass and snow removal?
7) Are there any code violations with the city that need to be addressed?
8) Are there deposits and what are they?
9) I ask the tenants what are there likes/dislikes about the property they are renting?
10) Will they sign a 6 mo - 1 yr lease or do they prefer a mo. to mo.?
11) When was the last home inspection and if I could see it?
12) Was there any modifications or major work that has been done within the past few years?
If anyone could give me some of their ideas on what to ask or if I should be doing something differently please let me know, im open to all suggestions since Im fairly new and wanting to make my 1st purchase ASAP. I want to buy that first property, get to know the ins and outs and buy more but the first one always seems to be the toughest. Thank you everyone for your ideas!!!
Sean
Sean,
I used to live in Aurora (on Pepertree Lane next to Fox Valley Mall). I was on business there a few months ago and boy has it changed since I lived there in '86.
Anyway, you should also ask what the zoning is. Where I live in CA I find lots of multi unit properties that are not zoned as multi unit.
You should also ask for a copy of the rent rolls (rent history of the tenants and vacancy history) as well as documentation as to what deposits are owed to which tenants. There is a legal name for this document, that I don't remember that maybe someone else here can recall.
I would also go to the county offices (or use an online service) to find out as much about the property that you can. Your agent will only know the minimum about the property and you will be able to find out more truthful/factual data through the count any way.
HTH,
Robert
[addsig]
Although you shouldn't rule realtors out as a source of leads, I would estimate that less than 5% of available modivated sellers you are going to find through a realtor.
You have thought of very great questions. You should find out from the realtor all income and expenses associated with the property.
You should ask the tenants their experiences with the landlord and just anything they are willing to volunteer.
Thank you Robert and Myfrogger for the advice, it is much appreciated.
Robert, you use to live out in Aurora, I would have to say it did change allot since 1986, they have built allot around here and for the better. I appreciate your output and asking for rent rolls and vacancy history, I did not think of that. I was out in the Cali area 8 yrs ago for the Marines and wanted to live out there but RE is so expensive, maybe after I get a few properties under my belt I will be able to go back out there and invest.
Myfrogger, thank your advice, you did bring up a good point in which you will only find about 5% of motivated sellers through a RE agent. Do you know of any other ways or avenues in which I can find motivated sellers that will sell at a price to where I can make a good net profit per month? Since Im still a beginner I can only think of a few off hand such as RE agent, newspapers, and networking. Thanks again for everyones thoughts.