• This is a political forum that is non-biased/non-partisan and treats every persons position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

Buying a house, being a landlord?

Joined
Nov 8, 2006
Messages
11,923
Reaction score
6,161
Location
Milwaukee, WI
Gender
Male
Political Leaning
Undisclosed
Has anyone here bought a house and rented it out? I'm about to start a new job that I think will give me the income that will finally allow me to do this, and I was wondering if anyone here has done this and if they could give me some advice or links or anything. Haha I've basically just started looking into this so I'm pretty clueless but I want to be really prepared for when I actually go through with it.
 

tacomancer

Capitalist Social Democrat
Supporting Member
DP Veteran
Joined
Jan 8, 2010
Messages
41,741
Reaction score
22,329
Location
Akron
Gender
Male
Political Leaning
Progressive
Has anyone here bought a house and rented it out? I'm about to start a new job that I think will give me the income that will finally allow me to do this, and I was wondering if anyone here has done this and if they could give me some advice or links or anything. Haha I've basically just started looking into this so I'm pretty clueless but I want to be really prepared for when I actually go through with it.
The first thing you should do with any business is do your market research. Find out the following:
1. Percentage of rental properties that remain vacant for three months or more
2. Rental prices for similar homes and their vacancy rates as well
3. Estimated cost of maintenance and a disaster plan
4. Town, county, state regulations
5. Potential liability and how to defend yourself if the worst happens.

At least that is what I can think of off the top of my head. I know people who love to do rental property and I know people that consider it a perpetual headache.
 
Last edited:

Jerry

Banned
DP Veteran
Joined
Jan 28, 2006
Messages
51,124
Reaction score
15,258
Location
United States
Gender
Male
Political Leaning
Independent
Has anyone here bought a house and rented it out? I'm about to start a new job that I think will give me the income that will finally allow me to do this, and I was wondering if anyone here has done this and if they could give me some advice or links or anything. Haha I've basically just started looking into this so I'm pretty clueless but I want to be really prepared for when I actually go through with it.
A few previous landlords of mine placed each of their properties in separate LLCs. On paper, they did not own their property. The LLC owned the property, and they owned the LLC. This way if something happens, the LLC is sued, not you, and the most any lawsuit can get is the value of the LLC, ie; the property, not your children's collage fund or your 401K.
 
Last edited:

ADK_Forever

DP Veteran
Joined
Sep 6, 2008
Messages
3,706
Reaction score
1,001
Gender
Male
Political Leaning
Undisclosed
It takes a certain temperment to be a landlord. You have to expect repairs to come up, sometimes on Christmas Eve, and you can't take them personally. If you're not handy are you going to hire out all repairs? That can get expensive and cut into your budget. If you don't like late night calls for drippy faucets and such... buy CDs.

If you go thru with it, do back ground checks, insist on previous landlord's phone #s and call them!, use leases and include some maintenance responsibilities for tenants for a modest rent reduction. Demand a good deposit... no excuses or payment plans.

Ask lots of others about their experiences.

Be smart and treat it as a business, because it is.
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
Has anyone here bought a house and rented it out? I'm about to start a new job that I think will give me the income that will finally allow me to do this,
I have done it. I advise that you to not rent out your house, if you can affort it. Tennants, unless you get lucky are a real pain in the ass. I rented out my house for around 5 years, because I live in another country. Now, I keep it as a holiday home.
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
You have to expect repairs to come up, sometimes on Christmas Eve, and you can't take them personally.
Ask lots of others about their experiences.
I used to put in the contract, that they rent as is, and if any repairs and replacements need to be done, they are responsible for both getting it done and paying for it. In return, I charged them a lower rent, than the market rent for the type of appartment I have.

This is a good protection system to have, because some tennants can be petty and nit picking to extremes. You dont want to drive 20KM, to change their light bulbs, for example.

Also, consider who will help, in the case that you need to evict them, for not paying rent or whatever.
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
Ignore all damage, except structural and fire. They will damage things, but best not to waste time arguing. Just assume there will be repair costs for you to cover, when they leave. Have insurance to cover fire and structural damage, in case you are unlucky enough to have a tennant who causes such damage. Structural damage may seem unlikely, but there are tenants who would do things like knock down walls to make rooms bigger etc. And, they dont necessarily know what they are doing.
 

Ockham

Noblesse oblige
DP Veteran
Joined
Oct 12, 2009
Messages
23,909
Reaction score
11,001
Location
New Jersey
Gender
Male
Political Leaning
Libertarian - Right
I currently rent 2 houses --- one makes money and the other doesn't. My pointers are: Make sure your taxes+insurance do not exceed the rental comparisons in the area. A real estate agent should be able to pull comparisons from the surrounding area. Also make sure to check on forclosures in the area you're planning on buying. Sale prices of houses around a forclosure usually affects the sale price of the house so you may have extra bargaining power on your purchase. Next, expect that even in a pristine purchase, that you or the local inspector will find issues to be fixed before getting an occupancy approval. Build in 1 week and about $1,000 for various paint, an electrician or plumber visit and the like. If the house is less than pristine, up that by a factor of x2 each time more things are found. I've under-estimated multiple times and it's no fun. Make sure to get a termite inspection before you buy a house and I'd suggest strongly to pay the extra money and get a full home inspection by a reputable company. Check the better business bureau on the finalists and do your homework on getting a good one. The few hundred bucks are well worth it especially if you need to walk away - otherwise you'll be stuck with possibly expensive and time consuming repairs.

About the rental --- I go through a real estate agency and I do a full financial and criminal background check on the renters. I don't usually like referrals from prior landlords because they usually give sterling reviews whether the renters were bad or good. The worse the renters were - the more sterling and exhuberant were the recommendations. Make sure your contract is locked tight - especially around breaking a lease early, penalty's, time frames for moving and showings, as well as if the renters are not going to re-sign for another year - that you have enough time to rent while they are still living there AND that they must make the house accessible. Make sure all the utilities, repairs, etc. are mentioned. Pets are another thing - I put penalty's in because I do not allow pets in the rental property. If damage or pets are seen to be occupying - it will cost an additional. Late rent - I put in a 5 day grace period - after which a penalty is added on of $250 each occurrence. I also use a Post Office box and not my home address. I'd also recommend keeping good electricians, HVAC, and construction folks handy. Referrals are best if you don't have them already.

Also, I do not normally do month to month - but require a 6 month or full year lease. Everything must be signed and notarized. Lastly, make sure to keep all correspondence, letters, cancelled checks, accounts, etc... organized. Phone calls and phone records as well - eventually land lords either sue or get sued so having organized and complete records makes it easy come court day.
 

Middleground

Dam Epidamic
Bartender
Supporting Member
DP Veteran
Joined
Jul 15, 2005
Messages
26,215
Reaction score
12,155
Location
Canada's Capital
Gender
Female
Political Leaning
Progressive
I own a triplex and have had nothing but trouble. I could write a book about all the **** that has went down, though I am not sure if it would be a comedy or drama, LOL.
 

StandUpChuck

Tart with a Heart
DP Veteran
Joined
Sep 19, 2008
Messages
10,188
Reaction score
3,727
Location
New England
Gender
Female
Political Leaning
Undisclosed
I don't mean to be rude, but won't you need a little longer employment history to qualify for a mortgage?
 
Joined
Nov 8, 2006
Messages
11,923
Reaction score
6,161
Location
Milwaukee, WI
Gender
Male
Political Leaning
Undisclosed
Wow, a lot of really good advice. Thanks a lot everyone!

I've heard that a lot of people have a ton of problems when they rent out, but I think if it's done properly it shouldn't be too much of a headache, at least in comparison to the income generated.

My dad is actually a certified inspector and he's good at it so I shouldn't have to pay for that, either, if/when I actually go through with this.

As for the mortgage thing, that's probably true, but I'm pretty sure I could find a way around that.

Keep the advice coming; it's really enlightening and super helpful!
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
''I've heard that a lot of people have a ton of problems when they rent out, but I think if it's done properly it shouldn't be too much of a headache, at least in comparison to the income generated.''

Yeah, you will earn money from it, even if the tennants are not ideal types. At least I did. My appartment is in Ireland, so I dont know if the same applies in the US as regards earnings.

The big bonus is, it is a way to pay off your mortgage loan. If you get lucky with tennants, you could earn quite a good income. If you dont get lucky, then you will still end up with enough money to pay for the mortgage and the repairs and replacements needed. Sadly, you have to charge all tennants, on the basis that they will be really bad, so that all eventualities will be covered.
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
I own a triplex and have had nothing but trouble. I could write a book about all the **** that has went down, though I am not sure if it would be a comedy or drama, LOL.
Yeah, me too. My last tennants were squatters, sort of. I showed up there, becasue my tennant had not payed rent for 5 months, and I didnt have time to fly over there and find out what was going on for 5 months. The tennant was no longer living there, but 5 strangers were, and the tennant was charging them rent, while not giving me any of this rent. As well as that, he charged way more than I did.

They were anxious that I might make them homeless, by throwing them out immediately. I told them, I have no new tennants so they might as well stay and pay me rent. As well as that, they had been living there for months already, and the place was clean and in good condition, even though I showed up unexpectedly.

To the opening poster: It would be useful, if you live near where the rented property is, so you can easily go there, when they dont pay the rent, to chase after it. Also, consider what you will do, if you need to evict somebody. I dont know about the US, but in Irland, we usually hire a hulk or send out brothers around.
 

Ockham

Noblesse oblige
DP Veteran
Joined
Oct 12, 2009
Messages
23,909
Reaction score
11,001
Location
New Jersey
Gender
Male
Political Leaning
Libertarian - Right
Good point - each state and sometimes each locality in the U.S. has their own eviction laws / process. It differs all over - and it's definitely a good idea to know or get information about an eviction and how it's done - even if you file it away somewhere.

@ Mell - we have to go through a formal process of filing and then posting the eviction notice on the property. Then we go with the sheriff to the property. Problem is, if there are children in the property, you can't just throw them out on the street... there's a whole new process after that...
 

Mell

Well-known member
Joined
May 11, 2010
Messages
1,008
Reaction score
145
Location
Germany
Gender
Female
Political Leaning
Undisclosed
@ Mell - we have to go through a formal process of filing and then posting the eviction notice on the property. Then we go with the sheriff to the property. Problem is, if there are children in the property, you can't just throw them out on the street... there's a whole new process after that...
I think in Ireland it is also officially like that, but many people pay no attention to it. They rely on the fact that it will be too time consuming and troublesome for an ex tennant to take any legal action, after they are thrown out.
 

Harry Guerrilla

DP Veteran
Joined
Dec 18, 2008
Messages
28,955
Reaction score
12,423
Location
Not affiliated with other libertarians.
Gender
Male
Political Leaning
Libertarian
Wow, a lot of really good advice. Thanks a lot everyone!

I've heard that a lot of people have a ton of problems when they rent out, but I think if it's done properly it shouldn't be too much of a headache, at least in comparison to the income generated.

My dad is actually a certified inspector and he's good at it so I shouldn't have to pay for that, either, if/when I actually go through with this.

As for the mortgage thing, that's probably true, but I'm pretty sure I could find a way around that.

Keep the advice coming; it's really enlightening and super helpful!
Read this all the way through.
The guy goes through the whole process of buying a house and gives lots of good tips, in my opinion.
Remember though, that owning a house is more than a mortgage payment, it's also the maintinence costs.
Which can be huge.

How to Buy a House -- A guide for first-time home buyers
 
Top Bottom