All Forum Posts by: Alan Pederson

I usually don't agree with Jim but this time I do.

I bought a house that I knew needed lots of work. I did a lot of work to it before putting new tenants in it and thought my problems were over. We bought the house at the end of July 2017 and tenants moved in middle of September 2017. Tree roots clogged up the sewer line the day before Thanksgiving in 2017 and they wanted action because they were having family over for the holiday. I was out of town but still called in a repair man to look at it. Repair man couldn't fix the problem so I offered to put the tenants up in a hotel until the problem was fixed. They couldn't flush a toilet or take a shower so I felt obligated to pay for hotel. They decided to deal with it over the weekend until I had it fixed a couple of days later. The plumber fixed the problem but left the yard a huge mess and they also left the new cleanout pipe sticking out of the ground a foot high right in the middle of the yard. I went over there and graded the yard smooth, cut off the excess pipe, and put in a meter box to cover where the new cleanout was. Fast forward a few weeks. I get called back to deal with their electric bill running close to $300 a month. They claim it needs more attic insulation. I inspect attic and find 40 year old ductwork and places where there is no insulation at all. I spend one Saturday replacing ductwork ($300) and another Saturday blowing in a foot of insulation ($300). I also notice that the ground in the front yard has settled and their is now a crater where the sewage pipe was replaced (add another project to the list). I came back a few days later to grade the yard again. The following month I hear that their electric bill is now in the $125-150 range. This is a 1320 sf house so that's about right. I drive by and notice that the yard has settled once again. I have to return and re-grade the yard again. Now the ice maker doesn't work (Feb 2018). Ceiling fan stopped working (May 2018). Trees hitting power lines (July 2018). Garage door opener not working (Nov 2018). OMG will this never end... In Feb 2019, the water from the AC backs up and takes out the wood floor. I spent 3 weeks replacing the floor. Jun 2019, I get a call about the fence needing repairs. I go over there and sure enough, they have a couple of fence sections that are rotted out. I also notice that the previous owner did a poor job of installing the fence. I have to install about a dozen brackets to secure the current fence to the fence posts so the fence won't bang against the posts when the wind blows. For 2 years I was going back over to this house for something about every month or two. I really thought about selling this lemon and moving on. Every time I go over there I apologize for the things they have had to deal with. They pay to have a nice place to live and enjoy. They shouldn't have to put up with things falling apart all the time. Even though it's been a big pain in the rear, I knew what I bought and was getting into. I'm just glad they were understanding and patient.  They're very nice people, keep the house very clean, and always pay the rent on time.

You told them it's their responsibility to make sure all of the issues are addressed and to follow up with the electrician. I lived in an apartment for years and was never told something like this. I would report any issues to the office and maintenance would come over and fix things. If it wasn't fixed I would report that back to the office. They did the same thing and you're getting upset? Were any of these issues on your inspection report when you bought the property? Have you went over to the house to see what needed to be done and the type of workmanship your repairmen are doing? If the work is satisfactory in your opinion I would just tell the tenants that your not going to pay to make everything perfect.

I bought a house 2 years ago that needed lots of work. The former owner thought he was handy but he wasn't. Everything he "fixed" I had to fix the right way which cost me more time and money than the original repair would have been. I kept getting calls from my tenants every couple of weeks or months and I was about to lose my mind. It took some time but everything has been repaired. Some of it was done by others (I oversaw the repairs) but most of it was done by me. We spent $17k in total.

Welcome to BP.

I started out asking two family members from my wife's family to show me the ropes. That didn't work out well. One told me nothing but horror stories and he said anyone that gets into residential real estate was crazy. The other one told me horror stories as well but shared some successes. He told me to get a property manager because I was going to be in way over my head if I thought I could just go out and start investing on my own with no experience.

I listened but didn't take their advice. I read as much as I could find and listened to lots of podcasts. I had money saved and got pre-approved for a loan. I knew about what size and price house I wanted to start with and had already done lots of market research in the area so I knew what houses were renting for. We made offers on about 6 houses before finally getting accepted for one. We went thru the inspection report and did a walk thru to determine what needed to be fixed and updated. I spent a few weeks doing the work, learned a few lessons, gained some knowledge, and found some good tenants. No horror stories yet. I guess a mentor could be helpful at times but not something that's necessary in my opinion. If you have questions, post them here and you'll get plenty of help.

You can have a thousand what if's but for me the biggest what if was when I realized that if I don't do this, where will I be 10 years from now if I don't?

My wife spent the entire holiday weekend helping me get our newest rental ready for new tenants that are moving in on the 15th. I'm sure that wasn't her first choice but i'm glad she helped or I would be struggling to get this house ready in time. Everyday we start by looking at the list of things that need to be done. She takes some things that she can do and I get the rest. If we need materials to finish a task, we just write down what's needed and move on to the next task. This saves us time running back and forth to the hardware store. When we're done for the day, we clean up then head to the hardware store to get the items listed so we can start working on things the next day. This is the first time she has gotten so involved in the process of prepping a house. She got to see first hand how frustrating it is to go to Lowe's and spend a couple of hours trying to find what you need. One of the items we were looking for was a light kit for a ceiling fan. They had only one that was the right color so we bought it. Sunday morning I start trying to install it and the screw holes all line up but the screws aren't the right size to secure it to the fan. Now I have to make another trip to Lowe's. In another bedroom the ceiling outlet that the ceiling fan attaches to is to small. I can't do this item so moving onto the next... By the end of the day it just didn't seem like I finished very much. All of the big things are done at this house. It's a dozen or so small things that are left. Towel rods, TP holder, ceiling fans, inti-tip device for stove, straighten 2 door frames, a couple of door knobs replaced, etc... I have 4 days so it should be okay.

That is all good advice. I'm a very organized person and I have spreadsheets that I put together to keep everything documented so I know what needs to be done and where. I carry I notebook around with me so I can write down notes when something comes up or I think of something important that I don't want to forget.

House #1 (2015) we did very little when we bought it but I knew a few things that needed to be done but put it off. Now those things need done and timing is tough. Murphy's law I guess. I have people wanting to move in on the 15th of July and I should get the inside of the house done this 4 day holiday weekend. Working with Oncor power company, a contractor, and electrician to get power line to house buried. This might take longer than the 15th but really needs to be done before anyone moves in. Tenants are fine with waiting till August 1st to move in if they have to.

House #2 (2016) just needs some grading work in back yard so water will stay away from foundation of storage building and I won't have to replace wood siding again. Shouldn't take a lot of time to finish but not big priority at the moment. No fun working outside in Texas in July.

House #3 (2017) no projects or maintenance issues. We spent lots of time and money fixing this one up over the past year.

House #4 (2019) we closed on this one today and first payment isn't until September. House doesn't need much inside work but it does need a lot of landscaping work. Again, working outside in July sucks. Will hire out tree trimming. It also needs some electrical and plumbing work. Will also hire this out.

Wife nagging me constantly about projects that need to be done at our own house but I never seem to have time to get to it.

I really need to get my wife more involved in the process. She could take over doing the tenant screenings to free me up to do the make ready work. She's off all summer so she has the time.

What I was really getting at when I started this thread was that when we bought our first rental it was like a dream that finally came true. This was something that I wanted to do for 30 years and it finally happened. All the emotions were at play. I was like a junkie getting a fix. I couldn't wait to buy the next one. When we bought #2 I was just as excited as when we bought the first one. When we bought the 3rd one, I was really excited but I knew this one would be different. It needed way more work than I had done to both of the other houses combined. I had just finished remodeling the master shower in my own house and I guess I was worn down a bit from that. Now I would be taking on a house that needed work in every room. I spent every day after work working on it for 4-6 hours a day. I spent every weekend for 6 weeks doing nothing but working on this house.

Over a year later, we finally bought house #4. My excitement just isn't there. It was a business decision and works with our long term goal but I thought I would be more into it like I was with the first 3. I'm not sure if it's just me getting older (55) or more experienced in the rental game but it's just not the same thrill.

Is this what most of you experience?

We just got back from a week long trip to Colorado to see family and our grand daughter that's almost one. While there I was getting call after call about the house we have for rent and things related to the house we were about to buy. My thoughts kept going back to all the work I needed to do when I got home. We are heading to Alaska soon and I have been working on getting the details organized and itinerary put together so we don't show up in Anchorage and say "now what were we going to do while we're here?". It seems like I always have a lot on my plate.

We're closing on our 4th rental tomorrow. We've bought one each year since 2015. When we bought the first one I was so overwhelmed with excitement and terror that it was hard to sleep for days. Would I fail? Would I succeed? What lessons would I learn the hard way? Did I do my homework? Tons of questions kept flooding my mind while I would lay awake looking at the clock hoping I could get some sleep.

This time feels different. It's more about being overwhelmed with all the work and trying to keep everything organized. I have a couple of projects to do at rent house #2, rent house #1 is vacant and i'm trying to do the make ready while trying to get new tenants approved. We also close on rent house #4 today and it needs work plus I need to find tenants for that house at the same time. We leave for vacation in a week and a half and i'm not sure how I will get everything done before I go out of town. Playing handyman, property manager, and working full time on graveyard shift is starting to wear me thin. Is this normal?

We're in the process of buying another rental right now and we were quoted 5.5% by Colonial with 20% down. I paid it down to 5%.

I'm kind of facing the same problem. We are about to close on a house that has an AC system that is 38 years old. The inspector said he has never seen one this old. It works just fine. Do we replace or just leave it until it goes out? My first thought was to replace it but I wondered what the electric bill was with the old unit in place. The seller said the electric bill ran about $150-200 which is a little high for this size house. For now I think we're going to just leave the old one in place until it goes out or the tenants see some type of spike in their bill.

If I was doing this on a flip I would probably replace the unit. I can get a system installed for $4500. In the house we just bought, a new unit would have resulted in a higher asking price so the cost would have been a push.