To Use The Internet To Perform Due Diligence On Small Rental Properties
Copyright 2011 Landlord.com
Your main goal during the due diligence phase of a small
rental property acquisition is to gather the most reliable, factual, up-to-date
and verifiable information that’s available on the property and its owner.
This way, you’ll have the information that’s necessary make a calculated and
informed buying decision about the property under consideration, and to avoid
being bamboozled by an unscrupulous seller trying to talk you into buying a
“lemon-of-a-property.” Today, savvy investors can quickly perform most of
their property due diligence research by using their personal computer and an
Internet connection linking them to the myriad of Web sites that contain
property, ownership, sales, tax assessment, environmental, economic, crime and
demographic records online.
Perform Due Diligence Inspections Before You Make An Offer To Buy
The four main reasons for performing thorough due diligence inspections on
small rental properties before you ever plunk down your hard-earned money are to
1. Buying small rental properties located in declining areas with no
immediate turnaround potential.
2. Buying small rental properties with “hidden” problems that can’t
be quickly and cheaply solved.
3. Getting snookered into buying small rental properties with
“undisclosed” major defects that are too costly to correct.
4. Buying small rental properties contaminated with environmental hazards
that can make the property uninhabitable, and render it worthless.
Use The Checklist Method When Performing Property Due Diligence Research
The checklist method is the fastest and most efficient way to perform the
following due diligence searches on small rental properties:
1. Property records search: Check your county property appraiser or
assessor’s property records.
2. Property tax records search: Check your county tax collector’s
property tax records.
3. Comparable sales search: Check your county’s property records for
recent sales of comparable properties within the same area during the past six
4. Neighborhood crime search: Check the crime risk rating for the
property’s address with local law enforcement agencies.
5. Flood zone map search: Check the property’s address on local flood
maps to determine if it’s located in a flood zone.
6. Hazardous waste search: Check the property’s address for
environmental hazards with your local environmental protection agency.
7. Demographic and economic data search:
Check demographic and economic
data for the property’s address.
8. Code violation search: Check the property’s address for code violations
with your local code enforcement department.
Use The Internet To Perform Due Diligence Research On Small Rental Properties
As far as I’m concerned, the Internet is one of the greatest inventions of
all time, and ranks right up there with flush toilets, sliced bread and
basketball! For real estate investors, the Internet is the single best property
due diligence research tool available. Especially for investors who are located
in counties where property tax rolls are online. If your county’s property
records are available online, you can quickly find out who owns a property, when
it was purchased, how much it cost and its tax-assessed value. For example, here
in Tampa, I can log onto the Hillsborough County Property Appraiser’s Web site
and armed only with a property’s street address, and almost instantly obtain
the owner’s name, mailing address, sale price and dates for the latest and
prior sales, and the tax-assessed value of the property broken down by land and
improvements. I can also get a site map plotting the improvements on the
property, along with the tax account, or folio number assigned to the property.
Then, I log onto the Hillsborough County Tax Collector’s Web site, and type in
the property’s street address or tax folio number to obtain property tax
information about the property to include any tax exemptions claimed, special
tax-district assessments and tax payment status.
Where To Find The Names Of All Of The Property Owners In Your County
The names of virtually every property owner in your county are available at
your county property appraiser or assessor's office on what's known as the
property tax roll. The property tax roll lists every parcel of land in a given
county. Depending upon where you live, each parcel is assigned a separate tax
identification number, either an assessor's parcel number, APN, or an
appraiser's folio number. To find out if your county’s property tax roll is
available online, simply type the name of your county and state into a search
engine and click on search.
Online Property Records Search
The following Web sites list the county property appraiser and assessor
offices that have their records available online:
Tax Assessor Database
Public Records Online
National Association Of Counties
Public Records USA
International Association of Assessing Officers
Thomas J. Lucier is the President and CEO of Home Equities Corp,
a privately held Florida Corporation established in 1995, that specializes in
the purchase, fast-turnaround and resale of small residential rental properties
in the Tampa Bay Area. Tom’s new 92 page special report,
To Find, Buy And Turnaround Small, Mismanaged Rental Properties For Maximum
Profit, $29.95, is available for purchase at the Landlord.com e-Store