Discussion in 'Fine Living, Home, Design & Auto' started by Douglas, Jan 31, 2012.
Douglas, did you make it with a credit card?
You're saying goodbye to the house right?
That's better than renting something you plan to come back to (like if you had a 2 year rotation in Europe or something) as you know something will change about the house that you don't like.
Other than that, if you find good tenants, you can deal with management on your own. I have friends who manage a few apartment buildings, including some in the state they used to live in (although its enough that they can hire a person or two to deal with showings and maintenance).
Before you leave, try to find a local handyman that you can have be "your guy". Come to some sort of an agreement, set him up with a key, and show him anything funny about the place (and pay him for his time). Make sure he can deal with anything that comes up and/or knows people for more specialty tasks. This should keep you from having to drive down there very often and the cost should be negligible compared to 3 hours of driving time plus whatever it takes for you to fix it. If the furnace goes out in the middle of winter, you might have to pay for both the HVAC guy and the handyman's time, but it's better than you driving 1.5 hours down there, realizing that you can't fix it, and then having to wait around for the HVAC guy.
No sir, I made them with my own two hands, some 2x4s, an ancient compound mitre saw we inherited from our old house, and did I mention my own two hands?
I figured I needed sturdier, more useful sawhorses than the two plastic things I had, if I'm going to try to make long plywood cuts with a circular saw. So I can make the cabinet everyone told me not to get into.
Everyone of my relatives that are landlords have some ridiculous horror story about a renter. One began filling the tub...then left the house. Another stood in the sink bowl, not on the counter top, but in the sink and it separated from the counter. These are people with careers and educations so expect the unexpected.
Lol, I had a feeling that was the direction you were going. Not sure how many of these projects you plan to do but one of the tools i use most often for plywood is a track saw, which is a circular saw on a guide. Good luck with your project.
My favorite renters story is the tale of the kids who flushed their beer cans down the toilet instead of throwing them in the trash. And I'm not talking about a couple cans, the whole sewer pipe was full of them.
If you have to cut plywood with a handheld saw, I was taught to do it on the ground where you can support the plywood with multiple boards very close to where your cut is. Basically you take four 2x4s and lay them out so each piece of the plywood will be supported through the whole length of the cut. Even if you have four saw horses, you can't put them close enough together.
Edit: oh, if this is finish work what you should do is lay some sacrificial wood under the cut; it'll both support the plywood and prevent tearout on the plywood veneer.
Thats a fucking law suit right there. I'd shove a beer can up his ass before suing too (nohomo).
Yeah, unfortunately, they probably don't have more than $5 to their name.
Ataturk, that is how I cut it as well, but had no idea that it was the preferred method.
G's question got me wondering about residential rental property, something I've considered off and on for a couple years. Where I live, there is decent rental demand and the monthly rental rate is roughly 1% of the purchase price of the property so more than would be required to cover a mortgage payment, insurance, and small-to-medium maintenance expenses on the property. The value of the rental property itself is unlikely to either appreciate or depreciate much. What other kinds of things factor into evaluating the investment value of residential rental property?
My friends who do it (with multi-unit buildings though) are of the opinion that the market is flooded with idiots doing the same thing, so it is easy to do well if you are smart. Of course for them ( they are a couple), being smart included both of them spending time working for brokerage and property management firms to learn what's up.
Now they seem to be at a point where they can deal with the buildings they have on a part-time basis while dedicating most of their work to starting and operating a brokerage/management firm. The properties provide a nice income stream...but it also took more dedication than just buying a building while working your normal job.
Thanks for all the input, guys. I really do appreciate it.
One option I've found is a company that offers a tenant-placement service where you pay them a flat fee to find someone, do the background check, and get the lease/legal stuff worked out, and then you do the actual management. That might not be a bad approach, given it would cost less but still get some help with placing a tenant, which is what concerns me the most (at least right now).
To reply to a few questions/bits of advice:
I'd rather not go into too much detail, but let's just say selling it really isn't an option. I wish I could, because being a landlord isn't exactly on my bucket list, but I've looked at comps and the numbers aren't reassuring. Between the cost to sell, similar home values, and other issues, right now just isn't the time.
I don't intend to move back to the house. The working assumption is that we're gone from the current town for good. Of course, anything is possible, but I don't see a return to the house happening. Even if we do end up back in the area, we'll likely have outgrown the house by the time we do. The plan is to rent it, either in perpetuity or until it's worth selling. If we don't hate being a landlord too much, we could keep doing it forever, but I'm also open to the idea of selling it at some point when the market recovers. I'll just have to take that as it comes.
I'm really hoping that I won't have to rent to college kids. I'm not particularly close to campus, so I'm hoping I'll attract either families or grad students. There are also some zoning issues with student rentals, so that may be moot, anyway.
As someone else said, you can get a service to do most of that stuff. Around here there is renter's warehouse.
I have a couple friends who to it. One winds up losing about $100/mo on rent compared to mortgage/expenses, but they're happy doing that over taking a bath. Don't forget though that you can depreciate your house, so you lose the homestead but get the depreciation.
For what it's worth, I was told the 1% number when I got in touch with the agent who sold me my house, and it's looking like that's completely off. I'm looking at more like 0.7%, though it may turn out to be a little higher or lower when I get someone out to give me a better feel for what it should fetch on the rental market.
I'm leaning toward a service. I started looking around more thoroughly yesterday than I had been, and there are some good options out there. I'm not thrilled about giving away cash, but it will be nice to have someone who works as an intermediary. Plus, they'll be able to market a lot better than I will, especially given I won't be in the area. Even if that only means it rents a month earlier, that will be worth the fees.
I may end up taking a small loss, though, based upon the ballpark numbers I have, it's more likely that I'll just break even. Still that's better than the alternative, and I'm gaining the equity the renter is paying for me.
Yeah, losing the homestead isn't great, but you're right about the depreciation. Plus, I can write off any loss, and all of the costs associated with it even if I'm not losing money (interest, taxes, etc.).
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