Apartment/house rental business

[7391N]

Anybody here involved in this type of business? I thinking of 4-unit, identical, side-by-side apartments.

What are the things to be done to insure regular payment from the tenants? Are there contracts to be signed between tenants and landowner? If yes, what are the duration of the contracts (six months? one year?)? What about the maintenance of the units? How much does it usually cost?

If any of you guys have other relevant ideas/ advices regarding this, it will highly appreciated :D

[ghosthunter]

What are the things to be done to insure regular payment from the tenants?

rent to people with families & regular businesses (of good standing). Expats also are good payers (in general).

Are there contracts to be signed between tenants and landowner?

yes, a contract of lease

If yes, what are the duration of the contracts (six months? one year?)?

typical is one to two years but there are six month contracts.

What about the maintenance of the units? How much does it usually cost?

depends on what you are refering. If its the physical maintenance, the day-to-day cost is to the lessee. But if its structural, electrical or plumbing, its to the owner's. Association dues are paid by the lessee. Taxes are paid by the owner.

If any of you guys have other relevant ideas/ advices regarding this, it will highly appreciated :D

[mazdamazda]

mabagal ang ROI ng mga ganito... dapat either upscale townhouse or small & cheap apartments ang gawin mo.

one year contract... advance payment of one month and deposit of of one month... the advance payment ensures that they have a "buffer" when they default. the deposit for for just a guarantee so for unpaid utility bills that they might occur when they leave.

[docpete]

meron pa ba yong limit sa increase ng rental? Have a 4 unit apartment pero gave that to missus.Never inquired about its operations.

[Altis6453]

Depends on the amount of rentals you've been charging. If its really low, it can fall under the Rent Control Law which would limit your ability to increase rentals in the future.

[Psylocke]

Very slow ROI.

Tenants give you all kinds of heart-breaking stories on why they can't pay right now.

"Baboy" tenants leave your units in a mess.

Fly-by-night tenants gone in the morning.

Basically apartments aren't very lucrative...

[mazdamazda]

You can also state in the contract an automatic escalation clause if they want to renew the contract... sa amin 10% ang ganun.

Kung bibilhin mo ay existing structure na... ok yun. Pero kung mag build ka from ground up... medyo matagal ang ROI.

[oldblue]

kikita ka lang dyan kung paparenta mo tapos sasanla mo at the same time. para ma-maximize mo opportunity.

[buriroy]

I'm renting out a couple of townhouses, and from my experience
its very important to "screen" your prospective tenants.

Mas maganda kung makakuha ka ng DINK (double income no kids).
Yung young married couples (preferrably professionals) with jobs
at reputable companies.

Iwasan mo yung mga pa business-business lang. Hindi steady
ang income nito.

[chieffy]

I'm renting out a couple of townhouses, and from my experience
its very important to "screen" your prospective tenants.

Mas maganda kung makakuha ka ng DINK (double income no kids).
Yung young married couples (preferrably professionals) with jobs
at reputable companies.

Iwasan mo yung mga pa business-business lang. Hindi steady
ang income nito.

okay itong payo ni buriboy...

ako naman ay lessee at hindi lessor...matagal nabakangte itong nirerentahan namin ngayon yun pala sinasala nilang mabuti ang background ng prospective lessee...gusto niya sure yung income, masinop at konti lang nakatira...

mas maganda kung one year contract at hingan mo ng PDC's...one year deposit at one month advance...ilagay mo rin sa contract na yung deposit makukuha after 45 days kapag umalis na yung tenant pagkatapos ng kontrata para may contingency fund ka sakaling may nalimutang bayaran yung tenant na bills/payables ...

[oldblue]

I'm renting out a couple of townhouses, and from my experience
its very important to "screen" your prospective tenants.

Mas maganda kung makakuha ka ng DINK (double income no kids).
Yung young married couples (preferrably professionals) with jobs
at reputable companies.

Iwasan mo yung mga pa business-business lang. Hindi steady
ang income nito.

hehehe, DINK! learned something today

[van_wilder]

uy! ako na magconstruct nun apartment mo! hehehehe

[creepy]

Mababa talaga ROI ng rental business. Rental yields in the Philippines are generally low, especially for residential units.

[7391N]

Lots of good advices coming from you guys, just as I was expecting. Thanks very much it's all appreciated highly.

Any idea on how much a 4-unit apartment would cost to build? Total floor area for each would be approx. 80 sqm. (5m x 8m per floor- 2 storeys).

[van_wilder]

Lots of good advices coming from you guys, just as I was expecting. Thanks very much it's all appreciated highly.

Any idea on how much a 4-unit apartment would cost to build? Total floor area for each would be approx. 80 sqm. (5m x 8m per floor- 2 storeys).

15,000 per square meter is of good quality na... we can go a little bit lower depending sa style na gusto mo... but we can not go like 10-12k since we dont compromise quality... kung renovation lang... much cheaper...

[7391N]

15,000 per square meter is of good quality na... we can go a little bit lower depending sa style na gusto mo... but we can not go like 10-12k since we dont compromise quality... kung renovation lang... much cheaper...

thanks for the figure but can you define in detail what entails "good quality"? sorry to sound so ..uh.. unknowledgeable hehe.

[van_wilder]

thanks for the figure but can you define in detail what entails "good quality"? sorry to sound so ..uh.. unknowledgeable hehe.

high-quality materials... high-quality craftmanship... the work/job doesnt say anything "cheap" or "compromised"

in short... hindi siya low-cost housing ang itsura...

[7391N]

If you rent an apartment, it have this 3 months advance payment etc. scheme. So these kind of people used up all its advance payment and enjoyed a few months free while waiting for the apartment owner to evict them.

bad trip mga ganitong tao. kaya kelangan talagang ma-screen mga prospective tenants.

high-quality materials... high-quality craftmanship... the work/job doesnt say anything "cheap" or "compromised"

in short... hindi siya low-cost housing ang itsura...

baka meron kayong website ng mga finished products?

[butchokuy]

yung sa akin na tini-tirhan ko. 5th story "condo type building" inabot daw ng 7M.

[OTEP]

If you want a bit of peace of mind, magtayo ka near a hospital or medical school. You will have a steady stream of medical students, medical clerks, interns, residents, and fellows as tenants.

And most of them are in a position to be able to pay you on time.

Malakas din turnover lalo na sa mga interns at clerks dahil 1 year each lang ito and they have the option to chose another hospital (siyempre lilipat sila kung san malapit yun). Then you rent a new tenant.

Yung mga condo dito sa A.H. lacson, hindi pa umaalis ang tenant, may naka-reserve nang kapalit.