Why do so many Landlords not maintain their properties?

[Jeff Filali]

I've only been in this business a few years, but have purchased a lot of deals.  Mostly from motivated homeowners, and bank foreclosures, which I understand and expect many of those to be in bad condition.  But lately I've been looking at more and more Investor owned rentals, and multis, looking for value add potential properties. 

I am simply amazed at the condition of some of the properties, and of course the PM tends to get the blame.  But to me the PM is basically an employee. Seriously, am I wrong here?  I know tenants do not always take care of properties, many are dirty, but there's a major difference in recent tenant damage (within last 12 months) and issues you can tell have been long term damage that was never repaired over years.

I went into one where you could tell there had been a long term water leak causing the floors to be very soft where you worry about falling through them, and mold all over, I'm not talking just in the bathrooms either. Another one several sections of the ceiling were hanging down.  Another property the tenants had electric space heaters and said the building had a gas leak, so the landlord told them to buy space heaters and deduct it from their rent because it may be next winter before they can fix it.  Many with terrible roofs that look 30 years old, where you can see bare wood in many spots with missing shingles.  Trashed parking lots, broken fences, missing awnings, broke windows... Its one thing if the inside of units have issues, to me its even worse when you can see major issues from the outside.  That's just pure laziness to me.

Than after contacting you wanting to sell, they want full retail value for their property of what it will be worth once you do full rehab, and get the occupancy, and rental rates to where they should be.   Am I missing something here?