The day in the life of a landlord

[analog_kidd]

OK, you guys are all scaring me. Yesterday I had my first real tenants move into a house I just bought and fixed up. They seem like decent folks, have good jobs, college grads, but you never know do you?

In my lease I have a clause that says something like anything you leave on the property automatically becomes mine to do anything I want with it the day the lease is expired. Don't know how well it would hold up in court, but it's there in writing and signed by the tenant.

[Guest Lester Weevils]

Dad had a similar nightmare renting out a trailer to serial sequence of deadbeats out in the country, in the 1970's. I have been told that landlord responsibility laws tilted "too far" in the favor of deadbeat tenants in the 1970's and have been ratcheted back a little fairer between the two parties lately. Back in the 1970's it was nearly impossible to evict somebody in less than 90 days. And all the deadbeats knew it.

It isn't a new problem. One granddad was a 'self-made man' carpenter with a third-grade education, who had eventually accumulated a little rental property down in rural central alabama. I remember in the 1950's going with him to fix up houses after tenants had left, and the places would be totally trashed. Screens knocked out and door frames destroyed, holes knocked in the walls, totally awful smells, etc. So maybe deadbeats are bad nowadays, but they seemed to be pretty bad back in the good old days in the middle of the bible belt too.

There were and are actual slumlords who exploit the renters, though. So it goes both ways. Before slum lord laws, there were a lot of rat-and-roach infested properties that could be rented pretty cheaply. Maybe a place with peeling wallpaper and crumbling plaster, but on the other hand a poor young person just starting out could find a place he could afford. With new laws requiring a higher standard for rental property, the places are nicer, but young folks on low-pay jobs can't necessarily afford to rent them. The good with the bad.

If I ever had enough money to buy rental property, I would sign it over to a property management company to administer. Even if the property management company took "too much" of the receipts, it would be worth it not to hassle with renting and fixing up and evicting and such. It seems to me that you can't be a "nice guy" landlord without people taking advantage of you. It is the ideal career choice for a natural hard-hearted SOB, who might actually enjoy evicting starving widows and such.

An old friend runs a title insurance company. Asked him about property management companies. If they are a good deal or a ripoff. It was his opinion that they can be worth every penny unless you naturally enjoy hassling with tenants. Maybe he is wrong, but since he's been 'in the biz' a long time, am inclined to accept his opinion on the matter.

[felinesNfreedom]

Hey guys I have a question to all of you who own rental property. I have my old landlord trying to get money out of me from a house I moved out of in 2008 they sent me a letter may of last year and we talked with them and thought we had it taken care of but I guess not because they called last week wanting more money. I was wondering if there is a statute of limitations on how long they can claim money from me. I am ok with paying some of it but not what they want. If anyone could help I would appreciate it.

[Guest HvyMtl]

Juice you need to get an attorney involved. Hopefully, you have documentation from last year. Make sure the debt has not been sold and someone else is trying to collect.

[felinesNfreedom]

No its the rental company trying to get money from me, not another agency. They claim it's what the home owner spent to repair the property I rented from a property manager. It's for things like painting and lawn care, unclogging a toilet after we moved out its a long list thats a bunch of BS. Last year when we talked I told them that they would hear from my lawyer and they stated that the letter was not a bill just an estimate and that I need to write a letter disputing charges so I did and never heard back from them after that... until last week. I have the original letter and bill that was mailed to me along with my letter disputing it buts thats about it along with the copy of my lease. It's just been along time and thought it was taken care of.

[vontar]

Myself I rented 2 times in my life. I rented from Carden Rentals in Oak Ridge and I bet if I needed to rent again they would have no problems renting to me. They hated to see me go. I paid on time and never had any issues. I had a total of about 2 years with them.

[Smith]

OK, you guys are all scaring me. Yesterday I had my first real tenants move into a house I just bought and fixed up. They seem like decent folks, have good jobs, college grads, but you never know do you?

In my lease I have a clause that says something like anything you leave on the property automatically becomes mine to do anything I want with it the day the lease is expired. Don't know how well it would hold up in court, but it's there in writing and signed by the tenant.

It can be a good thing, but you have to stay on top of things and document everything. Make sure you keep enough cash on hand to repair anything necessary. Make regular visits (at least once a month) and keep a log. The law tends to hold landlords to the letter of the law and shows grace to tenants. The theory is the LL is able to financially able to repair but the tenants are put in a position of jeopardy since they can only rent to begin with and are assumed to be at a disadvantage from the start.

[perstare]

I got interested in this thread, and I really don't have much to add because other members have posted good posts.

So one more post won't hurt.... I think I had an experience which **hasn't** been mentioned here:

My wife and I wanted to BUY a house. Although the seller had advertised it for sale, when the time came to talk turkey about our counteroffer, he kept bringing the conversation around to renting it. (This gives you an idea of his mental process.)

I wanted the house, so I just listened to his crap, just letting his words roll off me ... He kept going and going and I just kept ignoring and ignoring, until he made a remark about his insistence on a deposit for a rental... because some people are dirty and filthy and take drugs and throw things at the walls and set fires... all this while looking at my wife and me right in the eye. That insulted me. What a bozo.

Happy ending, though. We bought the house. At a good price. We've been living in it for 13 years. Nice house. We're very happy in it.

Anyway... there's my "two cents" -- I can't imagine having that guy for a landlord.

Mike B

[analog_kidd]

Perstare, I have an idea why this guy may have been pushing renting. The way the tax laws are written, if I buy an investment property and sell it within a year, the profits get added to my net earnings for that year and I am taxed on them at whatever rate that puts me in. So, for example if I make $50,000 a year, and buy and sell a house that I make $25,000 profit on, my total personal earnings for the year are $75,000, at which I get taxed at around 25%.

If I keep that same house for just over a year, the IRS seperates it out from my personal earnings and taxes me at a set 15% on the house profits.

It's very common for someone to buy an investment house, then do a rent to own plan, where you rent for one year then buy the house.

[perstare]

Reply to Analog Kidd

I know about the capital gains handling of a house sale, but I did not know about that particular application of it. That is, the tax law made the fellow behave the way he did. I learned something, thanks.

Continuing about this fellow’s thought process, I remember that about a year after the sale, when I was doing my own income tax, I noticed that the tax law had changed somewhat during the time that the sale was concluded. That was a long time ago (about ten years) and I forget the details. But if he had postponed the closing about six weeks, his capital gain would have been taxed at a more favorable rate.

He considered himself the last of the big-time spenders – a real wheeler-dealer. Uhhh—No!

Mike B

[southernasylum]

My wife and I kept our first home when we moved from Clarksville to Franklin and have been renting it out since then. What a pain in the a$$! The first tenant paid the first months rent and a reduced deposit. (She had an excellent referral) Turns out the renter was a crack head and prostitute. She never paid a dime after that. Had to serve papers after the second month. The court gets 1 month to serve the papers, one month to set a court date after that and on the court date and even if they don't show up the judge won't grant access to your own house for another 30 days! In all she lived in our house for almost 5 months after the initial deposit and first months rent. At court we tried to reason with the judge about the signed lease and he said we could hire a lawyer if we wanted him to look at the lease. She had violated several terms of the lease including allowing other people to live in the house, non payment of rent, damage to property, etc. When we finally could legally enter the house it was a disaster. I didn't want to spend more to go after money I would never get so I didn't take her to court. Hasn't been too much better since then. I've put a lot of blood sweat and tears into that house and it breaks my heart to see the way it's treated by our tenants.

-southernasylum

[analog_kidd]

Southernasylum, I know what you mean by Blood Sweat and Tears. I bought this house (and another one two years ago) as real fixer-uppers. I found my handyman gene with the first one, and put a lot of effort into both of them. The first one I kept thinking we were going to live in, so I went above and beyond, and made it a top-notch home. The second one, I did way more than I needed to make it a rental, but I kept telling myself I wouldn't rent out a house I wouldn't live in.

Anyway, after all the time and effort spent on the houses, I have some seperation anxiety with them. It feels weird not being able to go to the place I just spent so much time at. At least the first house I'm renting to my sister, so it doesn't feel so bad, but this latest one was rough handing over the keys.

[Guest HvyMtl]

I used to do pro-bono legal work in St. Louis. Landlord - Tenant stuff. Not all tenants are bad, and not all landlords either.

But, there were a few of both that made the rest of them look like garbage.

For example: 80 year old lady lives in an apartment building, just renewed her lease for 5 years. Company buys the building to turn into condominiums. They do not follow the law. Notified her she had ONE WEEK to leave. She refused, and gave a copy of the lease to them. They had goons show up and take the doors off her apartment. That did not work, so they came back and took out the windows. Found her an attorney to take it pro-bono. The Judge went ballistic. He granted her the right to stay in the building for the rest of her natural life, rent free. The Company not only had to let her live rent free, in the building, they also had to pay for her move, and rent during the construction period (making the apartments into condos) The Company was then to pay her expenses for moving back in, to the condo of her choice. So, due to the Company's actions, they had to GIVE her the best condo in the building, and let her live there FREE, until she decided to move, or died.

Then there was this lady who showed up and asked if I could save her home. Found out she had not paid her mortgage for THREE YEARS. Found out she had lost her job, and was not able to pay. The electricity, gas, and water had been off for TWO YEARS. She had an adult son living with her (he was unemployed, and had his "boyfriend" living with them, even though his wife had a nice home across town... The "boyfriend" was a bus boy.) The house had been foreclosed, and sold TWICE. The new owner had legally filed to have her, her son, and his boy toy evicted, 3 months before she walked into the office. The Sheriff Department was scheduled the next week to enter the property and evict. Got her a pro-bono attorney, who somehow, personally do not see how, got her an extra 30 days to vacate.

She still did not understand why she could not stay there and live. It was "her" home... I tried, the attorney tried, the banks tried, and the Judge tried to explain it to her. She just would not accept it.

[Guest KimberChick]

I used to do pro-bono legal work in St. Louis. Landlord - Tenant stuff. Not all tenants are bad, and not all landlords either.

But, there were a few of both that made the rest of them look like garbage.

For example: 80 year old lady lives in an apartment building, just renewed her lease for 5 years. Company buys the building to turn into condominiums. They do not follow the law. Notified her she had ONE WEEK to leave. She refused, and gave a copy of the lease to them. They had goons show up and take the doors off her apartment. That did not work, so they came back and took out the windows. Found her an attorney to take it pro-bono. The Judge went ballistic. He granted her the right to stay in the building for the rest of her natural life, rent free. The Company not only had to let her live rent free, in the building, they also had to pay for her move, and rent during the construction period (making the apartments into condos) The Company was then to pay her expenses for moving back in, to the condo of her choice. So, due to the Company's actions, they had to GIVE her the best condo in the building, and let her live there FREE, until she decided to move, or died.

Then there was this lady who showed up and asked if I could save her home. Found out she had not paid her mortgage for THREE YEARS. Found out she had lost her job, and was not able to pay. The electricity, gas, and water had been off for TWO YEARS. She had an adult son living with her (he was unemployed, and had his "boyfriend" living with them, even though his wife had a nice home across town... The "boyfriend" was a bus boy.) The house had been foreclosed, and sold TWICE. The new owner had legally filed to have her, her son, and his boy toy evicted, 3 months before she walked into the office. The Sheriff Department was scheduled the next week to enter the property and evict. Got her a pro-bono attorney, who somehow, personally do not see how, got her an extra 30 days to vacate.

She still did not understand why she could not stay there and live. It was "her" home... I tried, the attorney tried, the banks tried, and the Judge tried to explain it to her. She just would not accept it.

The first scenario happened to my brother. Apartment highrise sold out, new owners evicted everyone to turn it into retirement condos. He was ready to go anyway though. Funny thing, it's more than 2/3 empty, years after teh conversion. Guess the joke was on them, lol.

The second one...she NEVER filed bankruptcy?! Wow. That's something. We used to get people who'd attorney-hop and try to file multiple Chapter 13 cases and avoid paying. Seems like the limit was 3 before they got dismissed with prejudice. The house must have been one hell of a dump for the subsequent owners to leave it alone. We had a few clients squat in their old homes too. I guess they just didn't know where else to go, or just didn't want to let it go....or maybe they just didn't want to PAY for a new place to live, lol.

[southernasylum]

Southernasylum, I know what you mean by Blood Sweat and Tears. I bought this house (and another one two years ago) as real fixer-uppers. I found my handyman gene with the first one, and put a lot of effort into both of them. The first one I kept thinking we were going to live in, so I went above and beyond, and made it a top-notch home. The second one, I did way more than I needed to make it a rental, but I kept telling myself I wouldn't rent out a house I wouldn't live in.

Anyway, after all the time and effort spent on the houses, I have some seperation anxiety with them. It feels weird not being able to go to the place I just spent so much time at. At least the first house I'm renting to my sister, so it doesn't feel so bad, but this latest one was rough handing over the keys.

Yeah, that was our first home and we lived there for 4 years. We got a great deal on it but it needed a lot of work. Before we moved in I repaired and painted all the walls. Put in hardwood floors and tile in the kitchen. Remodeled the kitchen. It was filthy when we bought it but I knew it had good bones. Spent nights and weekends working on it between work for a month to get it ready for our family. Now I'm constantly trying to maintain it while the tenant seems to do everything humanly possible to destroy it. We've recently paid it off and still don't make any profit on it just trying to maintain it.

I think the perception is that we must be rich to own a rental property. That is certainly not the case here. We thought it would help us financially. It's more just breaking even and now if we sell it a huge chunk of the profits will go to capital gains unless we invest into another property. Kinda sucks. Hopefully we will make a profit on it one day.

-southernasylum