What would you do?

[Sue T.]

Hi,
I am an out-of-state investor with a few single family homes in Cleveland, OH. I've been trying to obtain property management services for them, but all the property managers I've spoken to have passed on the properties; either b/c it's not in an area they service or they don't manage single family homes. Since I can't seem to find property mgmt for these properties, I'm not sure what I should do:

1)Try to find a handyman that is willing to help me rent out the place?
2)Try to rent the place out myself by flying out there as needed?
3)Sell the homes (possibly at a loss)
4)Other suggestions?

Thanks.

[Jon Holdman]

Don't know. Could you perhaps track down a real estate agent who was willing to do it?



Personally I'd never, ever buy property sight unseen. But given you're now in this situation, I'd buy a plane ticket and go have a look. Feet on the ground may reveal more than Google Earth. You may find that in fact they are unrentable at any price and that's why nobody wants to mange them. The fact nobody will manage them is a red flag that something is wrong.



Call me cynical but there's a surprise. Were these some sort of turn key properties? How did you originally get in touch with this agent?



Not sure how to answer that. If they're only worth 25% of what you paid and you have loans for 100% of what you paid can you afford to pay to get rid of them? Are you willing to take the hit to your credit and the possible judgments from just walking away? Did you pay cash and would have a financial hit but could get away with nothing more than a loss? For a reference point, I had tech stocks that I sold after the dot-com bubble burst for less than 10% of what I paid. Lots of people took 50% losses in their stock portfolio in the recent downturn and I'm sure some of them sold. Is your entire savings invested in these houses so that you would be devastated if you sold at a loss? Or, is this just a tiny slice of your wealth?