Lessons #1 from first year of self-managing our 20 rentals

[Heath Jones]

My plan is to post a series of experiences with the hope they provide information that may help someone else as they start their real estate investing journey.

Lesson #1 - Don’t Open the Fridge!!

One of the first things we learned was the difference between physical occupancy and economic occupancy. We had inherited 3 tenants that were behind on rent and two that were behind by 3 months. Within the first two weeks, we had to give notices to pay or quit. Unbeknownst to us, one of the tenants went to the electric company that day and turned off the power.

After receiving no correspondence from whatsoever from the tenant, after the allowable 14 days (as stated by Alabama State law and the lease agreement), I went into the unit and it was all moved out except the smelly, outside bin for garbage and a pile of what appeared to be junk was in the middle of the living room. I then went to inspect the rest of the unit.

As I walked through the kitchen, I stopped to see if they had at least cleaned out the fridge... I opened the door and was literally knocked back by the smell. I gagged and it took everything I had to hold down whatever was in my stomach. The fridge was full, I mean completely full, of absolutely rotten food.

At that moment, I vowed to never make that mistake again and made it a personal crusade of mine to save anyone who has never experienced the horror of something like that. This is why you pay a cleaning company to clean. You did not get into real estate so you could scrub refrigerators (which I did for hours and ended up just buying a new one anyway because it was a lost cause). Let the experts handle it.

So please, always remember if you are new (or aren’t but have never experienced this) and walking through your rental units...

DO NOT OPEN THE FRIDGE!!

[Nathan Gesner]

I bought a hoarder house a few years back. The fridge was originally so full of food that I need help holding it in just to shut the door. It was always plugged in so the odor wasn't too bad but it had food, meat juice, and sticky substances in every crack and crevice. This is what it looked like after the hoarders had "emptied" the fridge and moved out:

Everyone that looked at it said we should throw it out. However, it wasn't that old and appeared fully operational so I opted to try and clean it. I spent over three hours taking it apart and cleaning every single piece, sometimes more than once.

A comparable fridge would cost $600 - $800 new and at least $400 used. Even if I spent four hours cleaning it, that's still $100 an hour and well worth the effort. If I had replaced it, I would have spent 30 minutes getting it out and putting in the new one, the dump fees, and the cost of the new fridge. Well worth the effort. 

Then there was the stove and freezer...