What We Do BEFORE You Buy a House from Us...Not YOUR Problem
/We bought this house to renovate, rent, and sell to an investor. This is an example of why an investor should start their investment once these issues are over.
Usually, people (NOT US!!!) sell houses with tenants in them because the tenants and/or the house is nothing but trouble. We will buy those houses (for the right price) because we know exactly how to handle that trouble.
With this house we knew we had some renovation work to do to get it up to our standards, but we were hoping the tenant would work out and continue to pay rent. Part way through the renovation (safety repairs), our inherited tenant quit paying rent.
We had to take it to court all the way to the point before we could get a bailiff to remove her.
It's amazing we passed the city certification looking at the house now. But we did. We stopped the rest of the renovations though because we could tell the tenant did not keep up the property and she wasn't worth keeping. I believe the only upgrade we made was to the kitchen floor, which she immediately got filthy. You can't even see it in this video.
In order to be compliant with the city, landlords have three steps that need to be met.
1. Register the house. It's simple. It tells the city where to mail tickets if your tenant leaves the trash can out too long, or the alley gets overgrown, or the grass isn't cut. If you don't register the house, the first ticket is $250. If you STILL don't register it they can ticket you again. The tickets increase in price until the house maxes out at $10,000 in tickets.
Go here: https://aca-prod.accela.com/DETROIT/Default.aspx
Google: BSEED Application for Rental Housing.
2. Get the house city inspected and passed. This is another $250 ticket that keeps getting ticketed if there is no recorded Passed city inspection. I know the second violation is $500.
We have the city inspector come in before everything is done so we have THEIR list of what they want to be done. We use Detroit Inspection Group. The inspectors are outside contractors. There are a few groups to choose from. Their website is easy to use and it's accessed via BSEED. Once we're done with their safety fixes, we have them come back out and let us know it's passed.
3. Lead Paint Test. There is a list on the BSEED website of lead paint inspectors. Email me and I'll connect you with our guy we like the best. Monique@greatdaypm.com
The inspector is looking for chipped paint. Just don't have chipping paint anywhere before he gets there. Good inspectors will let you know if there is chipped paint and they'll have you fix it so you don't get into other failed lead paint test issues. It's around $500. We pay $475.
The ticket for no lead paint test recorded with the city starts at $500 and I've seen a re-ticket over $1,000 on houses I've researched.
The lead paint test and the passed city inspection then have to get through the city's system before being issued a certificate of compliance. It takes a while. This isn't a step I've been all the way through. I leave it up to the property manager. We flip the house and make sure the lead test and the city test are passed, then we let the property manager acquire the piece of paper that stops the tickets from happening for NOT having those three steps done; registration, city inspection, lead inspection.