Rentals...Worth the effort?

[dragoneggs]

I don't desire to be friends but I do desire to make my tenants free from intrusion. I am lucky as I have a DIY older couple with well behaved teenage kids. He gathers bids for repair, and does some himself. I have surprised them with a gift certificate just because they are great renters. I'm in this only because I made the mistake of buying before selling and have only had two tenants in six years. Probably will sell in a year or two when my current tenants flee since their kids will be out of high school. I admit I have been lucky other than the first tenants were pack rats and the place had quite the odor when they left. I raised the rent and got a better class of renter the second go around.

 

[PILOON]

As a landlord for more than 30 years, one absolute is to never become "friends" with tenants, especially divorced or widowed women or single mothers. They will adopt you as a surrogate father or husband.

Keep it impersonal and direct.

LOL, yep had a few of them. One kept inviting me over for a drink another seemed to want me to join them for a 'party a trois'.
LOL, wife would not let me go.

Then I once had a 'couple' that had lots of 'couple' friends.(Man could they consume wine.) While discrete they were a hazard as they made a lot of outdoor fires where they would cuddle and hold hands etc, problem was very dry forest and fire hazard which they did not understand. Otherwise they were not a problem. They were extremely well employed with VIP positions.
Again I refused to 'drop in' for a drink.

 

[LD1]

So far, most of my renters have sorta been friends.

Trouble living in the country and small towns. One way or another.....I know most of the people who are looking to rent. Not that they are really "close" friends that I hang out with, but rather people I went to school with, or one of my brothers or wife went to school with. Since between by brothers and wife siblings, we span the ages of ~25-35. And in my area......thats the ones doing most of the renting.

 

[ultrarunner]

For several years I have been able to avoid evictions in our units.

Instead I offer a cash payment when the tenant has moved everything out. Usually $200 to $300 will do the trick. They are out like a rocket, and there is never any damage.

Many people have criticized me for this, saying that a deadbeat tenant doesn't deserve anything, but I save lawyer costs and the damage to the unit. I come out ahead and the tenant leaves happy.

This is my philosophy... I have a lot to lose and any rental property is vulnerable if someone wants to do you wrong.

Business is about achieving your goals and not about teaching someone a lesson.

Many of the areas where I managed were lower income areas... some people really couldn't afford a U-haul rental or storage.

I have an eviction maybe every 5 to 7 years... and this is mostly due to very favorable to tenant rent control ordinances.

Typically, I will have a heart to heart with the tenant by saying this isn't working out and they have to go... We can work together or not and it is their choice.

If we work together, I will help with some expenses. If not, the money will to to the lawyers... either way they are leaving.

 

[ultrarunner]

Be friendly and not friends is the business philosophy that works for me...

One of my friends married his tenant... it was a duplex and he lived in one unit... they were happy for a number of years... he was older and she was from the midwest... after about 10 years they divorced... she really wanted kids and he didn't...

It was a friendly divorce if you can say that... when they met she was 25 and he was 35

 

[PILOON]

A neighbor worked for a bank and told me of horror stories concerning repos.
Paint poured in tubs and sinks, studs cut water poured in electric panel etc etc.
Naturally those deadbeats can't be prosecuted as they have no assets and probably on welfare as well.

I once almost was going to buy a bank repo Mortgage outstanding was about $100k and they offered it to me for $25K
After examining the property I refused it.
Anything porcelain was destroyed, they had totally scrapped the floors by randomly cutting it with a skill saw even weakening the floor joists. Stairs were also chopped up and most windows needed replacing. Furnace had been sabotaged as well.
While not a castle, it had been a cute 2 BR 'starter home' in a not bad area. Landscaping had also been demolished.

The attitude seems to be, If I can't have it, then nobody will get it.

 

[ultrarunner]

Scorched Earth policy....

The banks and realtors don't really want to be involved either... I made repeated calls the listing agent that people were in the home carrying things out... she said not to call her again... call the police which I did first... they wanted an owner's representative to meet them and that is why I called her.

 

[MGH PA]

Wow. A lot to take in. Thanks for the information.

 

[EddieWalker]

A neighbor worked for a bank and told me of horror stories concerning repos.
Paint poured in tubs and sinks, studs cut water poured in electric panel etc etc.
Naturally those deadbeats can't be prosecuted as they have no assets and probably on welfare as well.

I once almost was going to buy a bank repo Mortgage outstanding was about $100k and they offered it to me for $25K
After examining the property I refused it.
Anything porcelain was destroyed, they had totally scrapped the floors by randomly cutting it with a skill saw even weakening the floor joists. Stairs were also chopped up and most windows needed replacing. Furnace had been sabotaged as well.
While not a castle, it had been a cute 2 BR 'starter home' in a not bad area. Landscaping had also been demolished.

The attitude seems to be, If I can't have it, then nobody will get it.

These where the types of homes that I would buy when I was flipping houses. They where trashed, unlivable and impossible to get a loan on to buy. I paid cash for them, which is the only way the bank would let them go. Then gut and rebuild them. Until those TV shows came along claiming to make six figures off of every flip, I was doing pretty good. Then people started paying twice and four times what they where worth and never being able to sell them once they cleaned them up.

 

[RollingsFarms]

There's just not enough ways to protect yourself and property as a renter, in my opinion. I've weighed the pros and cons many times, spoken with many people who rent and I've never come away convinced to do it. I was approached by a man who rents a lot of mobile homes, he wanted to move one on an acre of land I had and rent the land from me. Said he'd pay $150 a month, the land had hookup for city water and sewage and a shallow well. I didn't have any electricity running to the property but it would be easy to do as the power line was right there. The more I thought about it the less I wanted any part of such an arrangement so I passed.

 

[ultrarunner]

Rentals don't have to have beds... commercial is very viable as is land.

All depends...

Over the last 15 years I have been steadily exchanging into commercial property... business to business rentals are very much straight forward with NNN leases.

One of my most trouble free properties is a post office I bought... it is NNN except I am responsible for the roof...

 

[RollingsFarms]

Rentals don't have to have beds... commercial is very viable as is land. All depends... Over the last 15 years I have been steadily exchanging into commercial property... business to business rentals are very much straight forward with NNN leases. One of my most trouble free properties is a post office I bought... it is NNN except I am responsible for the roof...

I would like to get into the commercial rental property but man is it expensive around here! You can buy hundreds of acres of farmland for what a few acres of commercial real estate goes for. You bring up a good point about being responsible for the roof. There was a nice diner in a strip mall that was doing booming business for the year it was open. A leak developed in the roof and became worse and worse, the landlord refused to fix it so eventually the restaurant said "screw you" when the lease was up. Now instead of having a profitable business, the guy has a leaky roof that needs replacing and who knows how much other damage because of being stupid.