We are a bit in a holding pattern to begin our renovations of the investment property that we purchased in North Park, a suburb of San Diego. Three units, means three groups of tenants and these families have lived there for years. We chose to keep the current property manager in place until the properties were vacated. When a property has been rented for a year or longer and the owner wants the tenants to move, the tenants are given 60 days notice.
We instructed the property manager to provide the 60-day notice prior to finalizing our purchase of the investment property at the beginning of June. Our goal is to have the North Park, San Diego property completely vacant at the beginning of August. Yesterday, the property manager said that the tenants are having difficulty finding places to move. This doesn’t surprise me because the monthly rent that they have been paying is 50% of what they would be paying for similar rental units in North Park and the surrounding areas of San Diego. Granted the properties were in less than great condition, but, paying $800 for a 2 bedroom, 1 bathroom property in San Diego is rare.
The tenant that hadn’t paid his rent decided to move at the end of June. The backstory on him is that he finally did pay his rent to the property manager; he paid on June 24th. We viewed his 1 bedroom, 1 bathroom unit and he left it clean. We changed the locks on that unit and the garage.
Our dilemma is that we will be obtaining a roll off container (dumpster) for the tear out of the kitchens, bathrooms, windows, etc. We would like to start construction on the empty unit, but it feels more efficient if we wait until both buildings are completely empty. So, we wait. Personally, I am keeping my fingers crossed that the remaining two families find homes to move into by August 4th.
Dave will be visiting the San Diego zoning department in the next few days to determine if it would be feasible to renovate the 2-car garage into a rentable studio unit. This is an exciting idea because we would then turn a 3-unit investment property into 4 units and increase the profit margin substantially.
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