I’ll try to answer both of your questions. I LOVE the idea of renting in college and tourist communities, because the income potential can be much greater and you’re less likely to have periods of vacancy. However, these types of communities may have stricter regulations because the neighbors have gotten sick and tired of the partying college kids or tourists. This is the reason why it’s so important to be familiar with local rental regulations.

This series of 10 tips focused on buying a rental property, but I am working on another series of tips related to actually being a landlord, so that’s where things like finding tenants, doing leases, going to court, filing paperwork, etc. would be covered. Stay tuned for that – I’ll provide lots of details.

Finding quality tenants is important, but yes, the spread is not all profit. You need to make sure you have enough to not tap into your other capital if you need to evict tenants, are stuck with a nonpaying tenants or period of vacancy, unexpected maintenance, etc. That’s unless your strategy differs from mine and you have a nice slush fund for such expenses. I simply never had that luxury.

I greatly appreciate you taking the time to answer my questions.

All the best to you and I look forward to reading your next post ;)

Shan

The worst they can say is no.

I’ve had no issues obtaining mortgage loans because I have good credit and am buying properties within my means and at good prices. I believe those are the key factors. I know I’ve made a good deal when the mortgage or insurance appraiser comes out and estimates the property for more than what I paid right out of the gate.

If a house has safety or CO concerns, your insurance company will likely give you a period of time in which to fix them before they discontinue insurance. You may need to outline for them exactly what work will be done and when.

It’s not all that obtainable for your average investor to get a $1 deal–it’s like a very exclusive VIP room–but I mention it because it underscores the importance of being a quality landlord/rehabilitator. I never would’ve thought it possible, yet it happened, just a few weeks ago.

Your reputation and achievements can open all sorts of doors for you. Once people know you renovate houses, they may come to you in a bereavement or other situation. I’ve never gotten a $1 deal, but we did pick up one property deeply under its street value that way. I have to check the numbers but I think we ended up paying $35K when the house was worth at least $130K. Now it’s worth $250K minimum, though we did put additional funds into renovations.

The person I know with the $1 deal was offered it specifically and exclusively by a township which felt he did good works real-estate wise. They had properties they wanted gentrified, and he had the best local reputation. He remains very involved with the township, always attending community meetings and even has done a few “favors” in the area. He’s built excellent real estate investing “karma”.

Just remember it can go the other way as well–a reputation as a slumlord can cost you a world of hurt.

=)