Re: Rental property
[Re: nvwrangler]
#6564818
06/29/19 04:02 PM
06/29/19 04:02 PM
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Joined: Aug 2011
Posts: 45,502 james bay frontierOnt.
Boco
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Joined: Aug 2011
Posts: 45,502
james bay frontierOnt.
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A lot of headaches being a Landlord for the small return. Are you good at doing your own reno's?
Forget that fear of gravity-get a little savagery in your life.
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Re: Rental property
[Re: nvwrangler]
#6564879
06/29/19 05:16 PM
06/29/19 05:16 PM
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Joined: Dec 2006
Posts: 21,716 Sandhills Nebraska
Gary Benson
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Joined: Dec 2006
Posts: 21,716
Sandhills Nebraska
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Property taxes keep increasing. Some tenants can destroy a home quickly. If you've lived in the house for the past two years you can sell it and not have to pay income tax on it. That's what I've done. I like to have cash at hand.
Life ain't supposed to be easy.
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Re: Rental property
[Re: nvwrangler]
#6564889
06/29/19 05:32 PM
06/29/19 05:32 PM
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Joined: Dec 2006
Posts: 21,716 Sandhills Nebraska
Gary Benson
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Joined: Dec 2006
Posts: 21,716
Sandhills Nebraska
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Sounds like a good plan to me but everyone has different ideas and I'm certainly not well known for making good decisions. And there's always the unknown slipping up on a guy. One thing you can count on, taxes will continue to escalate and eventually it will be difficult to own any real property.
Life ain't supposed to be easy.
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Re: Rental property
[Re: nvwrangler]
#6565538
06/30/19 06:18 PM
06/30/19 06:18 PM
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Joined: Oct 2014
Posts: 1,655 Meridian , ID
Badgerman50
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Joined: Oct 2014
Posts: 1,655
Meridian , ID
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I own a few rentals. I Make a significant portion of my income from them. The only way someone can say they aren’t profitable is if they’re over leveraged. I own mine outright and they are cash cows. Even when things go wrong. In the Boise area prices and rent continue to skyrocket. I’ve made six figure gains in appreciation alone in the past two years. Even if prices went down, people will always need a place to live. That’s not counting rent. If I lost my job tomorrow I wouldn’t bat an eye. If I could talk my wife out of the monster house we live in ( 5 bedrooms 4 baths) I would move into a little house and buy even more.
If you’re thinking about buying some, make sure you can float the payment without any renters for around 6 months. Next, never buy in an area on the way down. Boise is a haven for people who have big fat equity in places like California, Seattle, and San Francisco. They sell their homes for 800k to over a million and buy a brand new home in a great neighborhood for 400k and have a half million to invest. They still view this as a bargain so prices will keep on rising here anyway. Idaho in general is a destination for political refugees from other states. Point is don’t buy in a place in decline.
As for LLC’s you can go that route for safety. I went ahead and bought an umbrella policy with an additional million dollars in coverage which just bolsters my regular homeowners policy.
As far as people trashing my homes, it hasn’t happened yet. It’s avoidable to a large degree. My mother in law is a property manager and was full of good information when I got started. There are companies that will do an intensive screening for around $30. I have the applicants pay for it and if I rent to them, it comes off the first month rent. Before I ever get that far with them, I flat out ask their credit score. Anyone under 650 is automatically disqualified unless I can get someone to co-sign for them who has good credit. Next, I ask if they they make at least 3 times the rent. No equals disqualified. I call all bosses to verify employment. Then I ask if they have ever been evicted. I’ll find out anyway but if it’s no, I ask if they can provide canceled rent checks for six months. If they say they paid cash, I ask to see bank records showing the withdrawals. Finally I ask if they have any convictions for sex offenses, acts of violence of any kind, theft, drugs, fraud, or arson. Any of these is a no go. If they seem good to go I do a thorough background check via the screening company. You’d be amazed at how many people lie anyway knowing I’m gonna do a check. Every adult living in the house gets one. If they lie, I move on and they forfeit the application fees. I write into my contract that if anyone moves in who isn’t on the original contract, that’s a breach and I may choose to evict at my discretion. If I let them stay, they have to pass a background check, must pay an additional 200 per month retroactive to the beginning of the lease. I get them to agree to that on the lease and needless to say it doesn’t happen. Idaho is very landlord friendly. Never buy a rental in a renter friendly state. I’m lucky here because our vacancy rate is next to zero. If someone moves I get 20 people banging on my door wanting to rent so I can afford to be really picky. As long as I apply the same rules to everyone I don’t get myself in trouble.
If you do buy a rental understand that you are providing a service. If my renters call about something broken I fix it immediately and with no complaints. I don’t own apartment buildings because I severely limit my resale pool of buyers. I stick with single family homes. Easy to sell if I choose to. Also keep a big reserve of money for the inevitable repairs. I don’t get greedy either. My rents are all around $100 under market value. People appreciate that and tend to stick around.
I would do it a hundred times over. Best decision I ever made. Good luck.
Badgerman
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Re: Rental property
[Re: nvwrangler]
#6565674
06/30/19 09:30 PM
06/30/19 09:30 PM
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Joined: Jan 2015
Posts: 3,446 Houghton Lake, MI
strike2x
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Joined: Jan 2015
Posts: 3,446
Houghton Lake, MI
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I do work for a couple people who own rentals. One has been doing rentals for some time and the other is fairly new. The guy who has been renting longer pays better and uses higher quality materials. I do have to deal with Tennant's and the ones I the nicer homes are much more pleasant. Good luck.
Wish I had more time to trap....
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Re: Rental property
[Re: nvwrangler]
#6565696
06/30/19 09:54 PM
06/30/19 09:54 PM
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Joined: Oct 2014
Posts: 1,655 Meridian , ID
Badgerman50
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Joined: Oct 2014
Posts: 1,655
Meridian , ID
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Birdman do you do regular inspection on the inside of the property? I don’t do them every 6 months like the contract allows for but often enough that when I go inside they’ve either been keeping a tidy house or go on a cleaning marathon before I get there. Either way is fine with me. I don’t want any $4000 surprises especially avoidable ones. You could issue a correct or quit notice before it ever gets to that stage.
Last edited by Badgerman50; 06/30/19 09:56 PM.
Badgerman
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Re: Rental property
[Re: nvwrangler]
#6565719
06/30/19 10:20 PM
06/30/19 10:20 PM
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Joined: Dec 2006
Posts: 4,940 PA
elkaholic
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Joined: Dec 2006
Posts: 4,940
PA
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Since you're new at it. I would suggest going through a realtor for the first time renting it out. Usually costs the first months rent. Let them do all the work. Then have them give you a couple of potential renters names. Go and do your own background check on them. Like was said above, get utilities to send you payment history's. Interview each candidate without the expectation of renting it out to them. Make sure that the lease has the names of each person living there on it. With the stipulation that if anyone else moves in their name will go on the lease and the rent will increase. If you're going to allow pets either do a one time pet fee at the beginning of the lease, or include a price in the rent. Dictate the size of dog allowed. We usually do the extra pet fee per month for dogs. Make sure it is spelled out in the lease what is expected of them as far as snow removal, lawn care, general upkeep. If you are furnishing appliances make sure they know they stay there at the end of their lease. Had one try and take a stove out the was supplied by me. They weren't happy when the cops showed up and made them put the stove back in the house and reconnect everything.
If you get a good tenant it can be a great experience. If you get a bad one it can be horrible.
ohhhhh Don't rent to relatives. They'll be your worst nightmare as tenants.
Millions of trees die every year to print environmentalist publications
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