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Can you make money being a landlord these days?
Number1AtNumber2
Member Posts: 31
https://www.seattletimes.com/business/a-landlord-a-tenant-and-the-battle-for-1042-cutler-st-in-upstate-new-york/
So Hill had taught himself the rules, researching on the internet about tenant rights, rent strikes in New York and the eviction moratorium. He read that almost 1 million other renters in New York state were behind on payments and that 80% of those renters had also reported having lost income during the pandemic. Hill watched online as Cuomo said: “The number one issue that people talk to me about probably is rent and fear about being able to pay their rent. And this just takes that issue off the table.” He listened during the presidential campaign as Joe Biden said: “There should be rent forgiveness … Not paid later — forgiveness.”
And so when Hill finally received some small unemployment payments and a four-figure stimulus check from the government, he used the money to fix the engine in his broken-down minivan, buy a little extra food, purchase some basic furniture, pay down his credit card, and surprise his daughter with a decent laptop for her virtual classes, because why would he spend what little money he had on rent that he didn’t actually have to pay?
So Hill had taught himself the rules, researching on the internet about tenant rights, rent strikes in New York and the eviction moratorium. He read that almost 1 million other renters in New York state were behind on payments and that 80% of those renters had also reported having lost income during the pandemic. Hill watched online as Cuomo said: “The number one issue that people talk to me about probably is rent and fear about being able to pay their rent. And this just takes that issue off the table.” He listened during the presidential campaign as Joe Biden said: “There should be rent forgiveness … Not paid later — forgiveness.”
And so when Hill finally received some small unemployment payments and a four-figure stimulus check from the government, he used the money to fix the engine in his broken-down minivan, buy a little extra food, purchase some basic furniture, pay down his credit card, and surprise his daughter with a decent laptop for her virtual classes, because why would he spend what little money he had on rent that he didn’t actually have to pay?
Comments
Most landlords in Seattle-area are making money because of the equity they have in their property when they go to sell thanks to market appreciation. The only people making any half-ass money on the monthly rent are those who bought 10 years ago, those who own the property outright, and those who are generational in the business and inherited property.
It is easy to look back and see that it has been a solid investment strategy, but what is more difficult to figure out is where do you go from here? This last year has been bumpy for sure. I managed to sidestep one bum at the beginning of the plandemic to get him out of his lease early in May of last year voluntarily before he was far enough behind to eclipse his last month and security deposit. I replaced him with group that have been great so far and also managed to raise the rent a little. So all good on that front. That is what I would call some standard level landlord bullshit.
I think one reason why people say that they would never want to be a landlord is that they look at it the wrong way. It isn't like buying berkshire hathaway and sitting back and watching it grow. You need to think of it as a side job. Like any job it requires work.
Speaking of which:
The backstory:
The place that is giving me trouble today had been a great investment. I bough in 2013 for $675,000. This was listed and on the open market for probably 60 days or so. I am in the money changing business and the house appealed to me at the time because as a SFR I could get a 30 year fixed right up to what was at the time the FNMA max of $506,000. I negotiated for the seller to pay all my closing costs and hooked up the loan at 3.625% which at the time seemed like as low as it would ever go. My plan was simple rent that baby out until I pay it off and the husky from Huston is right about inflation so that I can quit my job at Money Tree and live off the rent.
Present day problems:
I think you can guess where I am going with this. Tenants started dragging ass on rent about 5 months ago and it has been a pretty quick downhill slide from there. A developer is willing to cash me out 12 months from now for good money but the contract gives him a 30 day feasibility before he has any skin in the game. The tenants have agreed that they will move out and I told them I would forgive the rent owed if the house is not trashed. The term comes up June 1 so stay tuned for more updates.
The people who are late now gave me all kinds of BS about it being COVID related and that they aren't getting unemployment but I believe they are just taking advantage of the situation. I mean, like the quote in the story says: "Why pay rent you don't have to pay." well shit, I dunno maybe because you agreed to pay the rent when you signed your lease?
and bleached anus is right about people making money that bought a long time ago on equity appreciation but mobile home parks and self storage seem like you are setting yourself up to be dealing with the same poor smucks like the guy in the article.
This guy owned a large portion of downtown Seattle and didn't even need buildings. We worked with the kids and grandkids when they started changing parking lots into commercial real estate residence and office
also most people have a mortgage and pay taxes through that.
We? need to bring back debtor's prisons for the extra special deadbeats. Could help solve the homelessness crisis too.
If the unemployment was flowing (and I am not talking about all the money siphoned off to Nigeria) and the extra $600 and all those stimulating checks than why do you need to halt evictions?
They really don't want to evict you. Just be a man about it
As the man said, there’s no incentive to pay rent. Credit cards, while they have offered deferred payments, temporary lower interest rates, etc., can still have people sent to collections and have their credit score impacted (which could hurt your chances with renting again), right?
I don’t know what the answer to all of this is, but it seems like non-housing debt repayment is, like Cal, ranked too high.