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California investor buys Tucson seniors’ complex and raises rents by 50% | Local News

Raising rents is the key tactic

Easterly aims to eventually become a “billionaire, with a B” and raising rents is one of his main tactics, as seen in his social media posts. He calls it “forced appreciation,” a way to increase the value of a property faster than market forces alone would.

This typically involves cosmetic upgrades such as new exterior paint and landscaped gravel and rent increases of around 50%, its posts show. Rent increases are essential, he explained on the apartment flipping video, because the value of a rental property is closely linked to the income it generates – a number that banks use in their investment decisions. ready.

Easterly’s first Tucson purchase was in 2017 when it partnered with three other California investors, according to public records. They invested $350,000 in a $1 million, 30-unit apartment complex at 3653 E. Second St., and increased rents there by 53%, from $425 to $650 per month.

Eighteen months later, Easterly announced plans to refinance the resort for up to $1.7 million – 70% more than he had paid – and use the proceeds as a down payment on another resort. of apartments. He described the process this way in a January 2019 Facebook post:





Social media post on a public Facebook page by Kevin Easterly.


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EFF THE STOCK MARKET. Forced Appreciation, 30 units we bought for $1m – 2 years ago we just rotated all tenants and raised rents from 425 to 650. Put 110k in there. Now we are refinancing at 1.6-1.7. Take out our original money and put it into the next property.