I know there was a thread on this but I can't find it. If someone has a link to the thread please post it.

Looking a buying a rental property (should have done it years ago).

Spoke to two friends who have rentals so gotten a few tips.

For those that have rental properties (homes) what lessons have you learned over the years?

Two tips I've gotten from friends were;

• If you find a good renter, do the best you can to keep them happy.
• Background checks and credit checks.
• Put everything in writing.
• Always take before and after photos.
• Have maintenance people lined up for stuff you can't fix (plumber, electrician, etc.)

Thanks

Are you referring to the landlord horror story thread? That was a good one.

I've been self-managing some multi-family properties over the last few years.

A few things that come to mind:

• Be patient and make an effort to screen prospective tenants. You can list properties on Zillow and Apartments.com where they have applications with built-in screenings for credit and criminal history that work well
• Thumbtack is great tool for booking miscellaneous repair jobs at reasonable prices
• Setup a form of free digital payment for rent (obvious but huge versus accepting cash or check). Paypal, Zelle, Venmo are good options
• Don't be cheap and take shortcuts with non-cosmetic repairs
• If you scale up a bit, log your hours as you may be able to qualify as a "Real Estate Professional" which would enable you to write off rental expenses from personal W-2 income taxes
• Leave a lockbox with keys somewhere onsite so you can enable access to service units while you're not around.
• Make friends with neighbors as they can really make your life easier in a variety of scenarios
• Think about parking and drainage when evaluating a property

I'm a rookie compared to others here but these are good tips so far. I'd elaborate by saying take your time finding a great tenant rather than trying to get someone in the house quickly.

Personal anecdote: My initial tenants in our first rental are in their 3rd year. I didn't raise the rent after year 1 even though I could have. Raised it nominally after year 2. They take great care of the house so I'm not trying to nickel and dime even though the rent is a bit below what I could ask on the market. I'd rather keep great tenants than run them off with a substantial increase and take my chances replacing them. I'd also rather not have the house sit vacant.

Having good contractors lined up really helps alleviate the stress when something breaks. The AC went out THE DAY our tenants were moving in (July). Fortunately we have a great AC guy who came over right away.
Plumber, electrician, appliance repairman, etc.

AgsMyDude said:

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Buy more at the start of the pandemic.

Cash flowing isn't too easy to find these days with rates and prices being high.

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This is no joke. There were 4 or 5 properties that I looked at and didn't pull the trigger on back in 2020 and I really wish I had them now.

Get divorced before becoming a rental landlord.

Bummer.

Story time? Sounds like an interesting situation

Not really that interesting, although I do remember sitting on the front porch swing at the second rental when I was cleaning it up after closing on the place, wondering if I was getting ready to move there sometime soon. Also contemplating ending things with the ex, but it would have been so much trouble to unwind it all and we did round 1 of counseling instead. In the end she's the one who ended up moving to it.

That was 6.5 years before I told her it was time for her to go and do I ever wish I did it back then. The story isn't that interesting, I worked and she mostly loafed around the house on the macbook or her phone day and night. Internet addiction caused our lifestyles to be total opposites, then she came out a few months before I ended things. It was amicable at least.

The financial price was no longer owning rentals which would have been a great source of passive income for retirement. She got the entirety of the bank account (worth ~3 years of expenses) except for a small amount as an emergency fund for the kids and me, and gets paid monthly for a little over 4 years because it was that or start cashing out either the 401K or IRA. No child support was traded for no alimony. It sounds like a bad deal on my end but in this state alimony is a life sentence more often than not.

tjones said:

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AgsMyDude said:

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Buy more at the start of the pandemic.

Cash flowing isn't too easy to find these days with rates and prices being high.

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This is no joke. There were 4 or 5 properties that I looked at and didn't pull the trigger on back in 2020 and I really wish I had them now.

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I can pretty much say this about every property I've looked at in the past 20 years. I wish I had them all now! Haven't bought a property yet that I wish I didn't. I'm sure there are stories out there but property is more expensive now than ten years ago and will be more expensive in ten years than now.

Yesterday said:

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tjones said:

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AgsMyDude said:

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Buy more at the start of the pandemic.

Cash flowing isn't too easy to find these days with rates and prices being high.

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This is no joke. There were 4 or 5 properties that I looked at and didn't pull the trigger on back in 2020 and I really wish I had them now.

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I can pretty much say this about every property I've looked at in the past 20 years. I wish I had them all now! Haven't bought a property yet that I wish I didn't. I'm sure there are stories out there but property is more expensive now than ten years ago and will be more expensive in ten years than now.

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You bought during the longest and most explosive bull market of all time fueled by newly minted dollars and a money supply expanding at unsustainable rates coupled with historically low rates and never before seen cheap debt.

If the money supply ever contracts, your properties absolutely will be cheaper than they are today.

zagman said:

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Yesterday said:

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tjones said:

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AgsMyDude said:

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Buy more at the start of the pandemic.

Cash flowing isn't too easy to find these days with rates and prices being high.

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This is no joke. There were 4 or 5 properties that I looked at and didn't pull the trigger on back in 2020 and I really wish I had them now.

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I can pretty much say this about every property I've looked at in the past 20 years. I wish I had them all now! Haven't bought a property yet that I wish I didn't. I'm sure there are stories out there but property is more expensive now than ten years ago and will be more expensive in ten years than now.

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You bought during the longest and most explosive bull market of all time fueled by newly minted dollars and a money supply expanding at unsustainable rates coupled with historically low rates and never before seen cheap debt.

If the money supply ever contracts, your properties absolutely will be cheaper than they are today.

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No one is arguing otherwise. Most of our properties were cheaper for a period in 2008, 2021 and now than they were the year before. But none of them are over a ten year period. Even our first property that we bought at the end of 2007(top of the market).

He is short term thinking.



To the OP, be aware of the condition of big ticket items, namely roofs, fences, HVACs, and such. Those have a habit of all failing at the same time. Somewhere in that equation is either a time to sell or another seven year commitment

Do yourself a favor and don't let the tenant handle change filters. Do it yourself.

That's all I got right now.

Your ex came out as I assume a lesbian and that's not interesting?

agsalaska said:

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Do yourself a favor and don't let the tenant handle change filters. Do it yourself.

That's all I got right now.

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Absolutely

Keeper of The Spirits said:

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Your ex came out as I assume a lesbian and that's not interesting?

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Maybe as an event, but in the general board kind of interesting not even close. No need for rule #1

Yesterday said:

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agsalaska said:

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Do yourself a favor and don't let the tenant handle change filters. Do it yourself.

That's all I got right now.

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Absolutely

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I would also add, include lawn care in your monthly fee. This makes sure you don't get letters from the HOA about unkept yards. As an added benefit, if you're friends with the lawn maint guy, like we are, you can get reports on how the renters are keeping the propery

Get a home warranty and list your tenant as an authorized contact so if something relatively small needs fixing on short notice or at night or on a weekend, the tenant can use the home warranty company to get it done fast without waiting on you and you can reimburse them for the service fee.

Never, ever, ever be lenient on the due date for rent. If you let a tenant get away with being late once, they will almost always end up paying late.

Conduct "fire inspections" or "maintenance inspections" once a quarter to walk through the rental to make sure there aren't any obvious problems being created by your tenant (i.e. hoarding, damage/neglect, etc.).

Quote:

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I would also add, include lawn care in your monthly fee. This makes sure you don't get letters from the HOA about unkept yards. As an added benefit, if you're friends with the lawn maint guy, like we are, you can get reports on how the renters are keeping the propery

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And include a provision in the lease that tenants must water the lawn, plants, etc. to keep them alive. This may mean you're paying the water bill, too. Paying for lawn care doesn't do you any good if the tenant lets it all turn to dirt.

My rent house lease states that I control the sprinkler system and the tenant pays for the water. I definitely warn them about August water bills before they sign a lease.

We also have the lawn care included in the rent.

We have tried to offer rent credits for regular maid service with some success

Ryan the Temp said:

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Quote:

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I would also add, include lawn care in your monthly fee. This makes sure you don't get letters from the HOA about unkept yards. As an added benefit, if you're friends with the lawn maint guy, like we are, you can get reports on how the renters are keeping the propery

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And include a provision in the lease that tenants must water the lawn, plants, etc. to keep them alive. This may mean you're paying the water bill, too. Paying for lawn care doesn't do you any good if the tenant lets it all turn to dirt.

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If there is any foundation work, you have to properly water it for warranty purposes. So good idea.

Not sold a ton of my rentals between 19 and 21

Dumb dumb dumb.

I dropped my stars so can't DM.

Mind shooting me an email (in my profile)? I'd love to hear more, especially about that duplex you mentioned. I can't find anything like this!

Scrap is a wealth of information. We learned a lot from his posts when we started. I love his small multi/duplex strategy.

Hoping to get an email from him.

I've been looking to pick up a second rental for about a year in BCS and haven't had any luck. All barely breaking even or negative cash flow. There much be a network out there because nothing that hits the MLS is viable with today's rates unless you are just paying cash.

Might need to start looking elsewhere

Email sent