webLOGfor.US

    Sorry for the lack of postings lately.  I haven't abandoned the blog, I've just been traveling.  Alot.  There hasn't been a week in the last 4 that I haven't been on the road.  My easiest week happens to be this week where I am only traveling for one day.  It will be a long day at around 19 hours but still a one day trip.  Next week I'll be gone for 5 days starting my traveling on Sunday and returning home on Thursday.  After that I should have one more one day trip then a break for a week or two to try and get back on track with life in general.

    An update.  I have a bunch of information to continue the "Honest Company or Scammers" article.  I haven't had the time to assemble all the different pieces together to form an article, possibly two, from the information.  This is really taking shape.  

    Update on Condo #1, I received a call last week to let me know that the rent was going to be late.  In case anyone forgot this is the guy who has been with me for years and has a history of good payment with me.  I know he is going through a rough patch at the moment and want to cut him some slack.  I let a late payment fee go last month, but this month it will be enforced.  Paymnet shoul dbe received in about two weeks

    Update on House #1, I received the rent check in the mail on time.  It has been deposited but i won't know if it clears or not because I used Netbank.com and all their deposits were just acquired by ING direct.  Because of this ATM deposits are no longer accepted.  Between the federal holiday and the mail, I won't know if the check is good for about 1.5 to 2 weeks.

    I haven't had much time for life, let alone investing.  I'm behind on the news, blogs, you name it.  I can't wait until things die down a bit to give me some time for my enjoyment.

til then….

    Friday I received the rent payment for Condo #1.  I mentioned in my post last week that this was the first payment where the rental increase was due.  I received the full rent plus the late charge.   We'll see if September's rent comes in on time.  Hopefully the payments will now roll through as scheduled.  There was no note included, just a money order.  I have had a very good relationship with this tenant up to this point.  I hope that my sending a letter instead of calling didn't offend him.  I gave an explanation why in my letter to him.  I included a quick note with the receipt for payment thanking him and hoping all was well.  I'll have to make it a point to give him a call when my schedule clams down a bit.

      September will also bring in the first full month's rent payment due from house #1.  Up to this point there was the pro-rated month's payment due for moving in early and the first full month's rent was included with the security deposit.  Hopefully that will come in on time and all will be good….until the next problem of course.

     With as crazy as my traveling schedule has been I need the properties to be problem free for another month or so.  After that I should have some time to dedicate to them should they need attention.

web log for us – those that realize that "passive income" isn't always so passive 

Life: 

    Sorry I've been away for so long.  My full time career has been getting in the way of my blogging.  We're up for another re-compete of many positions we have filled around the United States and I've been working on seeing how they are going and writing proposals as needed.  I pulled an all-niter finishing one proposal only to hear of another that should be coming through sometime today.  I needed a stress release so I took a few minutes to browse the Internet, catch up on some news articles I've been putting off reading and figured I should update everyone on what is going on.

    In addition to the re-compete I've been traveling quite a bit lately to prep the customers for what was coming.   I wanted to prepare them and do everything I could to help out before the positions were actually advertised.  Once they are advertised I am no longer allowed to speak to the decision makers.  These are government contracts and I would end up disqualifying my company from the work if I were to have any questionable contact with the decision makers.  It looks like I'll be spending about 2 weeks on the West Coast next month.  Heres to some good weather!

New Tenant in House #1: 

    The new tenant is working out well.  He's honest and keeps me informed of things that go wrong.  For example, while moving in he was backing his car up with the trunk open and hit the outdoor light that is next to the back door.  It ended up cracking the base where the light attached to the metal plate that is affixed to the stone wall.  He wired it up so that you can't tell it was damaged unless you get very close to it.  Actually I had driven past the property twice and never noticed it until he pointed it out to me.  He said he'll fix it and I'll give him a couple more weeks to get it done.  If it is still broken by the time fall comes, I'll go out and buy a new fixture and replace it.  I'll forward the bill for the fixture over to him.  If the fixture was old I probably just let it slide and replace it free of charge but the fixture is about 3 years old.

Existing Tenant in Condo #1:

    I never received the rent from my existing tenant in Condo #1 for August.  This was the first month that the increased rent was due.  The rent increase was just about 5%.  I know he works split shifts and ends up sleeping odd hours.  I've been keeping crazy hours with my travel and proposals so I typed a letter out to him one night and sent it off explaining that I hadn't received the rent payment yet.  I let him know what my schedule was like and that I didn't call because I didn't want to wake him in the middle of his sleep since I know he keeps off hours for work.  I explained what the amount due was and what the late charge was.  I asked him to let me know if the payment was lost in the mail so we could work something out.  The letter was sent out last Wednesday I believe so he should have gotten it by Friday.  

    This tenant has been with me for just about 3 years and has always paid his rent, occasionally falling behind, but catching up quickly  He usually lets me know when he's running behind so this is an unusual circumstance.  The rent is still well below market value for the area which is OK with me because he is a great tenant.  Pair the lack of communication with the fact that this month was the first with a rent increase and it gets me thinking. If I don't get a check by Friday or at least some type of response I'll call on Saturday and pop over with a Pay or Quit notice.  I'll keep you updated.

CISSP Examination:

    Well, the CISSP examination was quite an ordeal and I wasn't sure if I passed.  Turns out I just missed passing.  I received a score of 689 in the CISSP certification test.  700 is the minimum score required for obtaining your CISSP certification.  Coincidentally another person in the class received a 689 also.  I think that is just plain weird.  I've tried doing some research to see if a 689 in the CISSP exam actually means something like I passed the test overall but failed one section but I haven't been able to find anything.   Even though the entire class exchanged emails and a ew of us sent our results out for all to see, only a handful shared the results.  out of the 8 of us that shared the results, 6 passed.  that's a 25% failure rate which actually works out to the percentage of the class that was there the 2nd time taking the test.  Interesting statistic. 

    I want to take the certification test again before I lose too much of this knowledge.  I was planning for the end of September to re-take my CISSP test but that doesn't look like it's going to happen.  With the plan of being on the West Coast for 2 weeks and a mini vacation scheduled in there the second week of September I am booked up.  One good thing though is that I'll be able to get a decent amount of studying done while I am on travel.  There's 4 6 hours plane rides plus the evenings are open while I am away.  No dinner to cook, no family to be responsible for, it could turn out to be a blessing in disguise being away for 2 weeks.  My CISSP certification pursuit continues….

web log for us – those that can multi task…and succeed

So I've taken a page from some of the other blogs I read to name the properties I have.  So from now on I will number the properties I have.  As of this day there is Condo #1 and House #1.  Here is a description I have for each of the properties.

Condo #1 – This is a 2 bedroom, 2 bathroom unit located in Northeast Philly.  It's approximately 820 sq. feet.  Tenant is responsible for all utilities except water.  Water is included in the condo fees.  The unit has forced air heat and central air conditioning.  I provide a dish washer, refrigerator, clothes washer and clothes dryer.  The tenant in this unit has been there for just over 3 years and has just had the rent raised by $35.00 per month as the unit is currently way below market value.  

House #1 – This is a 3 bedroom, 1.5 bathroom house in northeast Philly.  It is one of the typical "row homes" that are prevalent in Philadelphia.  This unit is unique in that it has a breezeway.  That means that there is a break in the center of the block.  This house is basically the end of a row but situated in the middle of the block.  This provides for a slightly larger house than the standard row homes on the block.  It also has more land as there is a side yard and the front lawn extends beyond the side of the property.  Tenant pays for all utilities.  The first $30 of the water bill is included in the rent.  This house has forced air heat and central air conditioning.  This unit has a finished basement with a gas fireplace.  I provide a dish washer, refrigerator and clothes dryer.

web log for us – those that learn from the other blogs we read 

    I subscribe to a Philosophy that if you find a good tenant, you do everything in your power to keep him/her.  If you find a lousy tenant, get rid of them quickly!  This has been the case with one tenant of mine.  He is currently in a 2 bedroom/2 bathroom condominium I own.  He has been my tenant for just about 3 1/2 years and is ideal.  I rarely ever hear complaints from him regarding things, he pays his rent on time and is extremely clean.  He truly takes care of the property.  

    I haven't raised the rent on this guy for the entire time he has been there.  It is now time to raise the rent to try and get it closer to maret value.  The common knowledge is that if you raiuse rents above 30 to 40 bucks, you may lost a tenant.  With that in mind I have decided on a $35 per month increase, which still leaves the unit well below market rates.

    Interestingly, I was ready to provide a letter to this tenant to raise his rents in December but before I could talk to him about it he told me he would be moving.  Being the person that I am, I wanted to make sure that it wasn't anything wrong with the condo itself, location, troublesome neighbors, or possibly something I did.  Good for all of us that it was nothing like that it was a happy occasion.  He was going to be getting married.  This was a second marriage for both of them and both had sons from the previous marraige.  Her's would be living with them full time and his comes over every weekend.  They needed a 3 bedroom.  The date was set for the end of April and they were looking to move into a place in May.

    Cha-ching.  I had a 3 bedroom coming on the market, close to where they are now and offered it to him.  It was a stretch of my time as I expected to have the place ready to rent in Mid-May but I figured I could step up the efforts and get it done a couple weeks early.  He was interested, they came to look at it and wanted to take it.  With that I saw no reason to offer him the letter to raise the rent.  I would re-rent it out at market rate and ke was taking the new place at market rate.

    As many things happen the deal fell through.  The marriage actually fell through and he ended up staying in the condo.  It was a bit of a relief because I was working at breakneck speed to get the unit ready for rental and this game me a little bit of time to move at a slower pace.  This is the house that I am currently finding tenants for.

    Why the long back story?  Well because it got me thinking of ways to raise the rent for tenants and not lose them.  I read a lot of articles where landlords send a terse leter sent stating rent will be raised on XX date by $XX amount to a total of $XX per month.  I think this impersonal approach is an easy way to lose tenants.

    In my letter to raise rents, I take the time to personalize it.  I give the details on the increase that the terse letter has but I also give detaisl as to why.  for me, it was an increase in codo fees, insurance and a large maintenance cost that was the cataluyst for the increase.  I let the tenant know that I appreciated them as as tenant, they way they took care of the property and that I hope they know that it was a purely business decision to raise the rest.  I also list the percentage of the increase in the letter.  I think that having a small number like that to equate the increase to shows that it is not that high of a number.

    With all that said, I am preparing myself for the normal things that come after a rental increase letter.  It's usually a bunch of the small things that need to be repaired that the tenant has decided to live with.  In my past experiences it's been things like light switches or outlets not working, broken pull cords for ceiling fans, etc.  The petty things that a tenat can help them justify the increase in rent.  I'll keep you updated as to any of the calls or requests I get about the increase.

web log for us – those that take the time to give a personal tough…..it's not all business