Dogs, doggy, scooby doo. They are cute and mean. The are lovable and smell. They keep us mentally healthy but need a lot from us. They shit and pee. I have a doggy. She shits and pees all the time. When they are young sometimes they poo and pee on you! On a rental property its a gamble, a crap shoot, a roll of the dice. Should I accept a doggy or not? Continue reading “Dogs: A Landlord’s Perspective”
Why be a slumlord? Because it’s very easy. The less you do on a rental property the less money you spend, the more short term money you get, and the less time you spend on the property. That sounds great in the short term but then you end up with a tear down. I am not a slumlord. That means I spend more money, get less money on a short term basis, and spend more time on the properties. I don’t want future tear downs. These last few months I had to prepare 4 vacancies for rent, three in the last 3 weeks, and many repairs also popped up. I have been swamped because I do most of the preparation and repairs myself. That has given me little time to write on this blog.
About a week ago I was installing a built-in microwave that went bad and thought to myself how much I would be charged to outsource that job. My guess would be about $150. Then I thought about all the other stuff I had done to get that property ready for lease and its probable cost if I had outsourced the labor. Below is the breakdown:
Install Microwave: $150 labor; $400 for microwave
Paint 3 bedrooms, 1 Hallway, 1 bath, plus baseboards: $1200 labor; $150 for materials/paint
Caulk baseboards and ceilings on about half the house: $300 labor; $30 in caulk tubes
Take out large Mirror and replace with double single mirrors: $150 labor; $70 new mirrors
Clean Gutters: $100
Mow and edge lawn (big yard): $70
Paint and install all door knob hardware: $150 labor; $7 in paint
Applying Tile Sealant on all tile: $200 labor; $60 for sealant
Replace old faulty toilet: $150; $110 new toilet
Paint all closets and pantry: $400; $30 for paint
Change out faulty exhaust fan motor and light switch: $200; $20 for fan and switch
Patch large cracks with cement on front porch steps: $80
Fix Garage door sensors: $100
All together we have a grand total of $3250 for labor that would have been spent to get the property ready. But wait there is more. I outsourced professional cleaning at $160 and carpet steam clean at $165. The carpet despite the steam clean still showed many stains so I opted to install new carpet for 3 rooms at $1050. All in all if I outsourced all the work done I would have been spending about $4625, plus materials of about $877, for an ultimate grand total of $5502! Geez…why even go into the real estate rental business? Well, as for me I saved about $3250 by doing all that work myself but did I really save? I spent so much time on all day weekends and late evenings trying to get things done. I have to wonder?
And this is just one vacancy. Now imagine the time and money spent on the others. Now granted not all vacancies are so labor/cost intensive, some less, some more. But all eventually will be as intense or even more intense when bathrooms and kitchens need updating. No wonder we have slumlords.
I imagine some landlords who have to outsource all the labor, attempt to do the minimum and not fix faulty items because of the high costs. They may not have the money or do not want to spend the money. In a few years, one day they look in the mirror only to find out that they have become slumlords. Then they may hide behind management companies. The management companies hold the burden of all the complaints but can not do anything unless the landlord offers money to correct an issue. The management company has a list of excuses why a problem can not be corrected or they lie and say it will be corrected but never do.
I just gathered all my information to do my taxes. That is the only place I see some type of relief for all the work and expenses done on all the properties. All repairs are deducted from our taxable income which is an added help during tax time. Maybe it’s not so bad being a landlord afterall. Maybe.
There are big ticket stuff like two years ago when I spent $14,000 on new siding on another property. Then there are the small costs here and there that add up to big numbers. I have boxes full of receipts. I have a contractor account at Home Depot and Lowes. Sometimes my clothes are covered with paint, grime, and dirt. My van is full of tools and debris. I take calls and correct problems on a constant basis. I do not hide behind management companies but sometimes I wonder if I should? Everybody thinks its easy. I say its not and they don’t believe me. Being a slumlord is easier. I am not one of those.
Above is an HOA (Homeowner’s Association) ordinance. Checkout the underlined statement. It says “no automobiles or other vehicles may be parked overnight on any roadway within the property.” The tenants refused to abide by the ordinance for a few months. What happens? You get a big fat bill for the violations accrued and you have to pay it. Ultimately, you as the owner are responsible for your tenants actions within an HOA. This issues can be costly. In this scenario it was hovering at around $350. It could have been worse. A lot worse.
Many subdivisions and condos have some type of HOA arrangement nowadays. The arrangement pretty much is as follows. You are paying them to maintain common areas and to also police you and your neighbors to preserve property values and provide quiet enjoyment. It is quite a trade off. Whether HOA’s are good or bad is a debate on its own and we are not going there in this article. My only concern was the issue at hand, that $350 in violations that could easily become $1000 in violations. I hate fines. I hate fines that are close to $350 even more. When they reach $1000…my hate for fines reaches its monetary limit.
I worked out a deal with the tenants. I asked them to move out in 60 days with the promise that I would be fair with their deposit and not blankly keep it all due to the issues that were transpiring . Then I emailed the HOA inspector at the end of October 2016, asking him to give me a two month grace period to solve the problem. He agreed! About 2 weeks from the time they moved out in January 2017 I sent an email to the HOA manager stating that their will be no more cars parked on the street overnight. Problem solved. They had moved out. I also requested for all the violation fees to be waived. Did they waive them off? Here is there response:
All the violations were waived! Communication was key. I communicated with the HOA inspector about giving me a grace period. I communicated with the tenants, explaining that it would be better off if they moved due to the amount of violations that they were receiving. I then communicated with the manager and asked for the violations to be waived. More importantly, I also did not pay any of the violations until I solved the problem. Then, at least, you can negotiate the fines down or in my case, waived! Hope this helps anybody who has had an issue with an HOA!
I lost $8000 dollars. It could have been prevented. I could have avoided it. I didn’t. It happened. And surprisingly, I don’t feel that bad about it. Am I losing sleep over it? No, I’m not. Am I banging my head against the wall? Not even. And its not because I think $8000 is a small amount. Both vehicles that I currently drive are worth less than that. I could have used that money to fund my children’s education, to buy a better car, a nice vacation, to invest, many other things. But now that money is gone….and you know what? I probably won’t miss it.
Now you may be saying to yourself….”What the heck is wrong with you? It’s $8000 freaking dollars guy!” My response. I shrug my shoulders and respond, “Oh, well. Life goes on.” Trust me, I have a valid reason. And I would be willing to bet that if you were in my shoes you would feel the same way. I talked to somebody who lost that much money in the same manner and guess what? They did it on purpose. I, at least attempted not to lose it even though my efforts in hindsight where “blinded efforts.” That other person lost about $7500 and they did it on purpose! If you think I am crazy for not feeling “that bad” about losing $8000, now imagine somebody losing $7500 on purpose. In fact, they planned on losing that money. They planned it! So don’t call me crazy now.
Now let me explain. I have a rental property (we can call it “Ignored”) that always leases out fast. In the first week of October the tenants moved out and my wife and I did the make-ready lightning fast. I did a glance over and started doing light touch-up on the place and my wife did some light cleaning on the kitchen only. We finished in one day. Placed it for lease right away and narrowly focused on the remodel of the other home I had just purchased (we can call it “Sponge”). Sponge consumed all my time due to the fact that it was an extensive remodel. My days were filled with my daily routine, the addition of trips to home improvement shops, placing light fixtures, trim, and other decorative features on Sponge. My work days would be ending at 9 pm every day.
October passed. Like a leaf, November blew away. December left like a souped up sleigh. And now we are in January and finally I began to wonder…Why the heck hasn’t Ignored been leased? Ignored has been leased out for about $2000-$2200 before and 4 months have passed with no takers. Four months without a tenant is a loss of $8000! I go back to Ignored, and this time do a thorough walk through and what do I see? Mold. Grimy mold is on the bathroom tiles and also notice that the bottom trim is filthy all over the house. Sponge had consumed so much of my life that I overlooked many obvious defects that would have deterred any potential renters. In all my years I have never lost that many months on a rental. Now I lost 4 months. I lost $8000. And that doesn’t include the loss of mortgage, insurance, and taxes paid for those months.
The next day I scrub that mold to oblivion and paint that trim like a classical painter. That same week the property was leased. Problem solved. I blamed myself for allowing Sponge to consume my life. It cost me a lot of money. But that still doesn’t answer the question. Why don’t I feel that bad about losing that money?
I never had it. I never touched it. It was never in my account. It was phantom money. Money that I very likely could have had had I done the right thing from the start. But since I didn’t it never came. My investor friend has a place in Florida that he rents out for $1500 and he decided not to lease it out to anybody for 5 months because he wanted to stay in it on his trip there for 7 days. He lost $7500. He could have stayed in a hotel instead and used the difference to spend on his vacation. He knew what he was doing. He knew he was losing money because we talked about it. But he was OK with it. He never had it. He never touched it. It was never in his account. It was phantom money.
That being said. If that money was in my shoe box and then by mistake placed in the recycling bin, and the recycling bin had been picked up, I would be cursing like when you are barefoot and step on a Lego in the middle of night. Then I would probably curl up in the fetal position at night wondering and whispering to myself over and over again…. where is it? Why? Why? And the mental anguish of losing it would bother me for days…until time would eventually heal the pain. Yes, I lost $8000. Will I do a better job to prevent such a loss in the future? You bet. Do I feel bad about it?…Now that I think about it…a little bit more now….
I have avoided deer all my life. They have made me swerve on the highway, drive extra slow on residential streets, and avoided a street altogether when walking my dog. Yesterday on Halloween I discovered a dead deer on the recently purchased property. It appeared to have died of internal injuries. What are the chances?
I almost became a little paranoid. Somebody must have dumped it here. One of the neighbors? Teenage jerks? My mother-in-law? Clowns?…Anything was possible? I inspected to see if there was a trail of blood or folded blades of grass, evidence of dragging. I found none.
The more likely scenario is that the deer just fell dead in the flower bed in the front lawn from a collision with a car or a metal fence. Oh dear! Poor deer! I call the city for a pick up but the city denies my request because the property is a few blocks beyond the city boundary. I call the county and they tell me they can only pick up if it is on the street and creating a road hazard. I’m screwed for deer life.
Should I pack it up myself in a black plastic sheet and haul it to the dump? The neighbors would think I am a mass murderer! It would look very suspicious that’s for sure. As I am writing this, the deer is still lying dead in the front lawn, bloated and smelly. I need to call an animal removing company because a mortuary definitely won’t pick it up. There are many doe’s and don’ts when it comes to wild animal removal. I need to do the right thing.
Well….the day I wrote the above article towards the evening I checked on that deer. Only the head and neck was left! The vultures have eaten most of it. I cancelled the animal removal company and decided to wait the next day. The next evening I see this:
I got out a black plastic bag, placed the remainder there, and put it in the trash. Problem solved! Thank you nature.
A few days ago I was at home in the late evening laying on my bed… reading the news of the day on my phone like most adults out there in the world do at that time. All of a sudden the phone rang and it was one of my tenants letting me know that there was a car in the small parking lot ON THE PROPERTY that has been there for several days and they had no idea who it belonged to. What do I do in this situation? Do I call the cops or towing company?
The next morning I drove out to the property. A few blocks from my destination I saw a police officer on the side of the road. My decision whether to call the police or the tow company was decided for me by fate. I waved at the officer and he came out of his vehicle. Once we were within talking range, the situation concerning the abandoned vehicle was explained and he ended up following me to the property.
Once there he ran a check on the vehicle. The vehicle came out clean. It was not involved in any robbery, murder, rape, and it was not a stolen vehicle. I knew then he wasn’t going to remove the vehicle. He explained since the vehicle check came out clean he really couldn’t do anything to help. Then I realized my biggest mistake of all. I should have been carrying donuts. A juicy glaze donut given to the officer for sure would have been enough of a bribe to have the vehicle towed out. He left and abandoned me like the vehicle I am trying to get rid of and Plan B came into effect. I called the tow company immediately. I told them I wanted the vehicle towed right now and they explained to me they couldn’t for the three reasons below:
Reason 1: I need to have a sign post that is 5 feet tall with a standard towing sign.
Reason 2: I also need to have a barrier like concrete stoppers, gate, or something similar separating my parking lot from the fourplex next door. (Texas Regulation per Towing Guy Conversation)
Reason 3: I needed to first do reasons 1 and 2 then wait 24 hours.
Quite a bit of work. But once I do all three they will tow whatever vehicle violates the new towing ordinance for FREE. Now going through all three steps could take up to a week or I could start knocking on doors at the fourplexes nearby to see who has any information about this vehicle. I started knocking on doors.
I knocked on a unit next door and there was no answer. On the next one somebody answered. I asked about the car and luck was on my side when she said the car was her brother’s. Apparently, the car just needed a battery and he had left it there until he bought a new one. Why he left it there on my property was not revealed and I didn’t ask. I just asked for it to be moved–that was the goal at the moment. She called his brother and he came with a new battery within the hour and problem solved! I didn’t have to tow and her brother didn’t have to pay $300 to a towing company to get it back. Taking a little time knocking on stranger’s doors paid off. And by the sound of the car…I think the brother bought a lemon…oh well.