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Thinking about becoming a Slumlord
drobs
Member Posts: 22,620 ✭✭✭✭
Found a 3 bed 2.5 bath house for $19.9k on 5 acres. Needs paint inside and foundation work - $5k. Rents are going for $750 to $950 in the area.
What do I need to know? Any good land lord info books or websites out there?
What do I need to know? Any good land lord info books or websites out there?
Comments
Good luck!![:D]
Found a 3 bed 2.5 bath house for $19.9k on 5 acres. Needs paint inside and foundation work - $5k. Rents are going for $750 to $950 in the area.
What do I need to know? Any good land lord info books or websites out there?
I would buy the property, fix up the house, sell it and an acre around it, then build 4 more houses on the remaining 4 acres to sell.
Way to much hassle being a landlord.[:D]
How can a decent house sell so cheaply?
Sounds REAL fishy to me.
I have a written lease. Not that it will do you any good, but it's worse for you with out it, so get one.
The economy is crap, so don't expect to get people with perfect credit.
The first people I rented to were a young family. Originally from the area, moved out of state, where the guy was a mortgage broker. They lived high on the hog, but then teh world collapsed, they just had a kid, the wife's pregnant again, and they move back here. The guy rents the house (which was my main residence for 13 years) without his wife seeing it. She sees it for the first time, and is kind of PO'd becuase it isn't the mansion that they had before. Bankruptcy will do that to you.
I had more servicemen (plumbers, electricians) to the house in that year than I did in 13 years of me living there. Most of the beefs were legit, but still, a pain in the rear. The key was, however, that when I got a call about the house, I coudl be there in minutes, and they knew it. The other key was that I always got the rent.
My new guy just got a divorce, has kids, and it's right by his old house and ex wife. Seems like a good guy, but again, he got hosed by the economy and his ex. He's already done a great job painting, got a new front door that I'm crediting the rent for (we agreed on a price limit), and so far, he's paid on time.
Call teh city, you may have to get a license to rent, or an inspection.
repairs on property
supplies needed to operate ( a new mower, computer )
mileage on vehicle
the list goes on and on.
I did forget to mention IF that home was built prior to 1978 and has lead paint you must give a letter to the tenant and have them sign off they received it. There are federal forms.
A 3 bedroom house for 19K?
How can a decent house sell so cheaply?
Sounds REAL fishy to me.
Yeah same here, make sure you have a home inspection by a reputable home inspector. I think there may be more to this than what you are being told, make sure you have a real estate attorney look over all liens against the property. And it wouldn't hurt to hire a private investigator to tell you if there is any bad history to the property, hauntings, a uranium mine directly underneath, or whatever. If it all checks out buy it.
If I was you I would fix it up and sell it with 2 1/2 acres, build a house on the other half then sell that.
My brother is a professional landlord, he buys numerous properties at a real discount price such as a sheriff's sale or if they are listed really cheap. he fixes them up and rents them. He makes decent money at it but it is a full time plus job and a major headache. I've heard horror stories about bad renters doing every thing from cutting the stairs out of a 100 year old house because they don't need the top floor, drawing a target on the wall and shooting it with a pellet gun, breaking out all the windows and removing the doors, covering the floor with dirt and grass seed then flooding it with water, covering the floor with sugar in the middle of summer, leaving dead animals in the house in the middle of summer, opening all the windows and flooding the floor with water during winter, filling the washer and dryer with concrete, moving out and taking 100 year old stained glass windows with them when they move. After all that crap he sold all of his section 8 houses and no longer rents to section 8 voucher people.
If you are going to rent it remember to take everything of value out and replace it with the cheapest stuff you can find that way if they destroy it you limit your damages. Paint everything eggshell white, its the cheapest paint, and put down the cheapest carpet and vinyl tile. Make them provide their own washer and dryer. Set your deposit as high as state law will allow usually around 1-2 months rent, require first and last month's rent up front. Have a lawyer draw up your contract, it it worth it. Don't allow pets, and make sure that if they break any part of the rental agreement you can evict them and keep their deposit.
The house is in the same town that dblwide was in. It's about 50 miles from my new place. The town is one of the bigger towns in that area.
There's a couple more dumpy 2 bed 1 bath houses available under 30k. I wouldn't mind grabbing all 3 but don't see that happening.
19K?
What???
It shared a well with the neighbor - family type set up.
When the house was foreclosed on the neighbor cut the well off.
Also its not in West Plains (where I thought) but just south a the town of Ava. Rent would be alot less. Maybe $600 range.
Going to look into seeing how much it would cost to drill and hook up a well.
Why it still interests me is raw land accross the road from me is going for about the same price but it has nothing on it.
Also, be sure to get approved for government assisted housing. You can get alot more rent and it's straight from the fed.
Yeah you get your rent, but the quality of people in that program is less than desirable. They will tear up your property and your rights are limited as soon as you start accepting that federal money. Its almost impossible to evict someone with a section 8 voucher, if they are a minority forget it. They will have it tied up in court for a year while they destroy your property and you can do absolutely nothing about it.
If you rent do background checks, I would advise hiring a private investigator, check with their former landlords, their credit history, criminal history, and references. You can even require prospective renters to pay for their own background check. You will get better renters that way, who are much less likely to tear up your place.
Management companies are a joke, yes they provide renters and usually half way decent renters but you can do that yourself. They show your property like a realtor would to private renters, which is a valuable service. But you could get a realty company to do that for less and you don't really need it unless you have several rentals in several cities. Management companies are supposed to handle repairs, regular maintainace while a property is vacant, handle all evictions, and enforce the rules and terms of the rental agreement. They in actuality do not give a poop, and they don't actually do any of that even though they are supposed to. I have seen 3 different management companies do the same thing and get fired, then they sue for breaking their contract but if you can prove that they breached the contract first you can get out of that.
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
drobs, it sounds like a load of crap... But, if you can honestly and legally obtain 5 acres with improvements anywhere in america, do it!
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
You want to buy 10 Acres? I can arrange it for 40K. Interested? If not all It can be subdivided. PM me. Land is in SC
drobs, it sounds like a load of crap... But, if you can honestly and legally obtain 5 acres with improvements anywhere in america, do it!
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
The 9.9 acres across the street is going for 19k. It's kitty corner from my house. Nearest town to us has a population for 300 something. Our town is the Bass Capital of MO.
Contact your state attorney general for LAWS in your state regarding landlord tennent issues.
Also, be sure to get approved for government assisted housing. You can get alot more rent and it's straight from the fed. [^]
BTW - I was a landlord for over 15 years. I'd never do it again. The headaches and pain ain't worth the gain IMO. To many scammers and aholes and scumbags lookin for a place to rent.[V]
Sure hope you are joking about that. That's a big part of the problem with America right now. Gov doing projects like that and the people allowing it to happen. Why not apply for welfare while you are at it.
Communism leads to fascism. Keep our business private and keep our federal government heavily regulated and forced into very limited powers as intended by our founders.
quote:Originally posted by storm6490
drobs, it sounds like a load of crap... But, if you can honestly and legally obtain 5 acres with improvements anywhere in america, do it!
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
The 9.9 acres across the street is going for 19k. It's kitty corner from my house. Nearest town to us has a population for 300 something. Our town is the Bass Capital of MO.
holy crap! i guess montana is la la land....
Be a good land lord. Don't get into the gubment welfare programs. You can rent your private property to whoever the hell you want. Take care of your clients and your property and they will take care of your investment. Keep on top of repairs they need. Improve the place without bothering them much and maintain a good relationship with them.
My brother uses these standards and does very well for himself in Wisconsin. Being a slumloard jerk who accepts program money from communist promoting federal projects will get you the kind of people that will make your life hell. Karma is a real *.
So, if you want to take the plunge... I say, BE BOLD!
Do some research, and ONLY rent to quality people! Let it sit empty, rather than rent to some scummy person that is going to destroy it. MUCH cheaper empty! I am VERY picky about who I rent to, and have only had to evict ONE person in 10 years! And I have a few properties.....
Merc
quote:Originally posted by calrugerfan
Get a property manager. It will take a little bit of your profit, but the peace of mind is well worth it. If you find a good one, you won't have to deal with very many headaches.
Contact your state attorney general for LAWS in your state regarding landlord tennent issues.
Also, be sure to get approved for government assisted housing. You can get alot more rent and it's straight from the fed. [^]
The above causes the below!!!!!!!!
BTW - I was a landlord for over 15 years. I'd never do it again. The headaches and pain ain't worth the gain IMO. To many scammers and aholes and scumbags lookin for a place to rent.[V]
Kitty corner land was foreclosed on. It still might be a nice pc to own as it backs up to a good size hill which would make for a perfect backstop.
quote:Originally posted by drobs
quote:Originally posted by storm6490
drobs, it sounds like a load of crap... But, if you can honestly and legally obtain 5 acres with improvements anywhere in america, do it!
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
The 9.9 acres across the street is going for 19k. It's kitty corner from my house. Nearest town to us has a population for 300 something. Our town is the Bass Capital of MO.
holy crap! i guess montana is la la land....
Sounds like Missouri is pretty good too!
And a good one will NOT rent to just anybody. They have access to background and credit checks and they've learned what to look for when screening clients, in addition to knowing the applicable laws. They make the most money when they have a good, long-term tenant in the house. If they can find a good one, then they get a monthly check just for collecting the rent. If they rent to a bad one, they have to do a lot more work for the same pay and risk a client no longer using their services.
Working on commission motivates the person to keep their client happy.
quote:Originally posted by Mercury
If you need a property manager, then you shouldn't be in the landlord buisiness! Also, since they work on commission, they'll rent to just ANYONE!!!!!!!
Do some research, and ONLY rent to quality people! Let it sit empty, rather than rent to some scummy person that is going to destroy it. MUCH cheaper empty! I am VERY picky about who I rent to, and have only had to evict ONE person in 10 years! And I have a few properties.....
Merc
quote:Originally posted by calrugerfan
Get a property manager. It will take a little bit of your profit, but the peace of mind is well worth it. If you find a good one, you won't have to deal with very many headaches.
This was in my grandfathers rental house. I will never become a landlord.
go by word of mouth so you can turn folks away.
its some kinda of gov. entity being in your bizz. imho.
Now if you're looking at it to flip it, ehhhh maybe.
There's the rub.
You can't borrow a penny on a house without a well.
Sometimes it costs 20K to get a well.
Sometimes, you can't get one.
Sometimes, you can get one for 3K.
You need to buy this book, The Landlord's Survival Guide.
http://money99.com/component/option,com_virtuemart/page,shop.browse/category_id,9/Itemid,26/
This is for Georgia but 99 percent of it will apply to Missouri.
We have one rental in Georgia and 4 in North Carolina and this book comes in handy in both states, about once a month.
John Adams is a real estate guru, he owns dozens of houses that he rents out, plus he does a dozen flippers a year.
Very smart guy, I have been to one of his weekend seminars at Emory University, he knows his stuff.
One of John's axioms is, Never own a property more than 45 minutes away from your house.
Of course, if you get a property manager that is a moot point.
I don't know what he says about property managers, my girlfriend has the book, I haven't read it in several years.
drobs, it sounds like a load of crap... But, if you can honestly and legally obtain 5 acres with improvements anywhere in america, do it!
is it a short sell? an auction? or listed real-estate?
where the hell can you get 5 acres for 20k?
.
Actually I have almost 6 of land in TN for sale in the $20K range that I used for shooting/hunting. Has a 800' peak with an awesome view. Still for sale if anyone wants more info.
Being a landlord doesn't mean you have to do the work yourself. Hire yourself a good dedicated handyman, and supervise the repairs! You'll STILL save money!
Merc
quote:Originally posted by calrugerfan
Getting a property manager turns you from a landlord to a real estate investor. I'd much rather be the latter.
And a good one will NOT rent to just anybody. They have access to background and credit checks and they've learned what to look for when screening clients, in addition to knowing the applicable laws. They make the most money when they have a good, long-term tenant in the house. If they can find a good one, then they get a monthly check just for collecting the rent. If they rent to a bad one, they have to do a lot more work for the same pay and risk a client no longer using their services.
Working on commission motivates the person to keep their client happy.
quote:Originally posted by Mercury
If you need a property manager, then you shouldn't be in the landlord buisiness! Also, since they work on commission, they'll rent to just ANYONE!!!!!!!
Do some research, and ONLY rent to quality people! Let it sit empty, rather than rent to some scummy person that is going to destroy it. MUCH cheaper empty! I am VERY picky about who I rent to, and have only had to evict ONE person in 10 years! And I have a few properties.....
Merc
quote:Originally posted by calrugerfan
Get a property manager. It will take a little bit of your profit, but the peace of mind is well worth it. If you find a good one, you won't have to deal with very many headaches.
Fixing the properties isn't the hard part for most of the people. It's dealing with the tenant. My brother has a house in Arizona that he rented to a couple that seemed perfect. It was a lease with option to buy. Credit was good, references were good, couple seemed nice. 3 months later, they stopped paying their rent. It took months to get them out along with a lot of headaches and expenses. He got a property manager. The property manager charges less than $75/month, found a tenant, and has had no problems. No late rent, no repairs that required my brother's attention, no headaches.
quote:Originally posted by Mercury
If they "knew what they were doing" they'd buy the property and be a landlord THEMSELVES!!!!!!
Being a landlord doesn't mean you have to do the work yourself. Hire yourself a good dedicated handyman, and supervise the repairs! You'll STILL save money!
Merc
quote:Originally posted by calrugerfan
Getting a property manager turns you from a landlord to a real estate investor. I'd much rather be the latter.
And a good one will NOT rent to just anybody. They have access to background and credit checks and they've learned what to look for when screening clients, in addition to knowing the applicable laws. They make the most money when they have a good, long-term tenant in the house. If they can find a good one, then they get a monthly check just for collecting the rent. If they rent to a bad one, they have to do a lot more work for the same pay and risk a client no longer using their services.
Working on commission motivates the person to keep their client happy.
quote:Originally posted by Mercury
If you need a property manager, then you shouldn't be in the landlord buisiness! Also, since they work on commission, they'll rent to just ANYONE!!!!!!!
Do some research, and ONLY rent to quality people! Let it sit empty, rather than rent to some scummy person that is going to destroy it. MUCH cheaper empty! I am VERY picky about who I rent to, and have only had to evict ONE person in 10 years! And I have a few properties.....
Merc
quote:Originally posted by calrugerfan
Get a property manager. It will take a little bit of your profit, but the peace of mind is well worth it. If you find a good one, you won't have to deal with very many headaches.