Unable To Sell Their Houses, Millions Of Homeowners Are Turning Into Landlords

From The Huffington Post:
Buying a new house last December was an easy decision for Brad and Melanie Juarros.

They had been eyeing foreclosed properties for months in their Sacramento, Calif. neighborhood just north of the American River. The house the couple wanted to buy was bigger, the $140,000 price within budget and the interest rate low (five percent for a fixed-rate mortgage). Even though they hadn't yet sold their present home, the Juarroses bought their dream house.

But there was a problem. Like millions of Americans, the couple owes more on their present home than it's worth. More than 15 million homes are mortgaged for more than their value, according to an August report by real estate research firm First American CoreLogic. About one in three homes with a mortgage fall into this category. The Juarroses owe about $83,000 on their home and they say they are worried that they won't be able to sell it for that much.

Rather than selling at a loss, they decided to rent out their old home to tenants. In doing so, the Juarroses join a growing number of homeowners who have become landlords, often reluctantly, as they struggle to sell during one of the worst housing markets in recent memory. The most prominent example may be U.S. Treasury Secretary Timothy Geithner, who after failing to sell his $1.6 million home in a New York City suburb found tenants instead.

Read More at The Huffington Post

Landlord Meet-up Event

Yesterday we held a landlord meet-up event to give landlords a sneak peek of the new Rentmatic software. It was a great success, although we're all feeling a little slow today. We plan on hosting another in the not-to-distant future, so if you couldn't make it last night, stay tuned.

Sneak Peek of New Software

We are having a casual event at Wheelhouse Investment Real Estate company tonight to give a sneak peek of the new Rentmatic web site, set to launch next week, November 10th. Wheelhouse is located at 300 Brannan St, Suite 504 in San Francisco, CA. Stop by if you're around.

New Composting Law for Landlords

A new video entry from our San Francisco multifamily partner, Wheelhouse Brokerage, details some interesting legislation that will affect landlords in the San Francisco bay area:

As of October 21st, The Universal Recycling and Composting Ordinance requires every multifamily building owner in San Francisco to separate their refuse into recyclables, compostables and trash. Gone are the good old days of just mixing it all together, right? Right...

Why is this great? Because even landlords have little tree-huggers buried inside them somewhere. Deeper in some than others.

Why is this terrible? Because it stinks, literally. The garbage area in my 13-unit San Francisco building already smells like old milk containers, now my compost is only getting picked up once per week and the level of ripeness is bound to be impressive. And despite the fact that Mayor Newsom said this was not intended to be another vehicle for fines, there are a number of landlords that will simply miss the boat and will incur fines (not to exceed $1,000) and possible liens.

Bottom line: It's a good thing. Where else in the world would you pause to consider where to put your pizza box?

www.wheelhousebrokerage.com

Is PayPal a good rent payment solution?

A lot of landlords consider using PayPal to help streamline the rent payment process. On the front it looks like a good web-based option, however if you look beneath the sheets, it isn't that great. First off, it takes 3-4 business days to add funds to a PayPal account. Once the funds are in the PayPal account, rent can be paid from one PayPal account to another instantaneously. However, once the landlord receives this payment, it will take another 3-4 business days to withdraw the money to the landlord bank account. Credit card funding is an option, but higher fees make the transaction too expensive. Lastly, PayPal has no way of organizing or reconciling payments by rental units or by roommates, so additional rent roll work will be required.

PayPal is an amazing payment platform for ebay purchases, fantasy football pools, and even to pay contractors, but it doesn't really do the job when it comes to rent payments.