Flooded Basement - Welcome to the Life of a PIG - DON'T BUY PIGS in OHIO

[Ben Leybovich]

So, in Ohio we are experiencing torrential rains - in 12 years I've lived in Lima, I've never seen rains like this...specifically in June!

This pig is currently empty. There was a family of 3 in the house at a rent of $665. They were good tenants for about 6 months - their rent was one of the first I received every month. And then they went bad - she left, took all of the furniture, ect. Somehow, this type of thing happens a lot to people who can afford to live in a $600 rental house. Their MO is the same - they can afford $600-$700 and they want a house; not an apartment - a house...

While these did break their lease, and lost their security deposit, the good thing was that they left the house in excellent condition. He, specifically, did the right thing and really did a good job cleaning up. This was last week, and I've been taking applications...

In comes the water, and it looks like this:

And this:

As you can see, there is a sump-pump in the corner. I put it in when I bought the house 6 years ago. I braced the walls at that time as well. The pump drains into a pit in the back yard. 

The issue here is that water is backing into the basement from the city drainage lines, which are too small to handle the volume of rain water that we are getting - welcome to Ohio engineering from 1940es, through the floor drains. While the sump is working, the ground so saturated that the water that is being pushed out by the pump into the pit in the back yard has nowhere to go...

Spoke to my plumber and he hadn't had 5 minutes of rest all night. Drainage lines which are too small is a common problem in Ohio. As far as I know, the codes have been changes, but the old grand-fathered stuff is still there. This is just one characteristic of a PIG in mid-west... 

As you can see, the gas furnace is under water. I'll be having to replace HVAC, and possibly water heater. Further, I'm going to have to seal off the drains in the floor to try and prevent water back in at any point in the future, and install a secondary pump...

All and all, I can see $4,000 expense, perhaps more. That's like 2 years worth of CF for that little PIG...hahah

LESSONS

There was nothing I could do differently here. It's an old house. All of the mechanicals are working properly, just not able to keep up with the water backing up from the city line caused by mother nature.

But there are a couple of lessons here:

1. All you smart CA people buying turn-key in Ohio, Indiana, and Michigan - this is the class of asset you are buying. If you think that $600 - $700 monthly rental equates to stable tenant and therefore stable cash flow - you are freaking nuts. Apartments at $600-700have a much better chance. Houses - NO!

2. If you think that $225-$350 monthly cash flow on paper is actually going to happen over the course of your hold of 507 years - you're just stupid. I can't put it any differently...

3. I haven't actually been to this house, but I've been on the phone with my guys a lot. I cannot imagine being out of town with this stuff going on...

Fun times!