House just went up for rent in our neighborhood…… how can people afford this? Why would you want to afford this?
This is what I'm doing as well. Actually, I've bought houses that need work and helped my younger family members into them by doing rent to own. After a few years the property increases in value enough that they can easily finance the large repairs. And they generally pay less than going rate for a rental apartment, and they learn how to be a homeowner. I was going to rent them originally, but I don't have time to fix them up with 3 kids in sports year round.... Shit, we're lucky if we have clean laundry...
5 bedroom perfect for 5 friends that split cost. When I was 18, 3 pals and I rented a four bedroom and split the cost. We were in it for about 3 years as that was the lease time.
A bit of a better deal, but still. Scared to think about what it’s going to be like in about 6 years or so when my kids will want to rent a house.
Looks like they may be counting the attic and basement as bedrooms. A grand a piece...that's terrible.
Lets talk about the $1400 house payment. That house as described is 1000 sq ft. How much profit would be reasonable? 10-15%? Just 15% puts that house at no less than $1600. I will never rent again without paying water (Fire Protection) because when they get it shut off it's a huge hassle. I also will not rent without paying for Garbage. Last time i did that they started burying what they couldn't burn in the back yard. Guess that adds another $2-300 ($1800-1900). Now lets talk about reasonable repairs like Toilets, Water Heaters, Heating and AC not to mention the appliances. Your $1400 house just went to $2000 without question for rent. Now what is the area rate for your home? I'll bet I'm low. First and foremost all renters are different. So you need to either know the renter which can be a bad thing because they feel like they deserve to be handled differently. Many even want to be late or even miss payments due to close relationship. NEVER rent to family is my motto. Not knowing the renter needs background checks (To do this well it costs money) and even that can go bad because they are not always putting all occupants on the lease. Then there is kids. They move in with a bright eyed 12 year old but then that kid turns 13-14 and guess what? Totally different issue. How about Pets. Cats and Dogs create damage. Even the best cats and dogs damage the house. The deposit will go up at the very least.
And you have to pay tax on any profit... Yeah, the family thing can be tough to manage. But in my situation they're just shooting themselves in the foot if they act like too much of an asshole.
All these arguments are why I’m glad I have ownership in commercial property. Three magic words…..Triple. Net. Lease. The renter pays the rent, the taxes, the utilities, the insurance and any repairs or structural changes they make to the interior. The only cost to us in six plus years of ownership so far is a new roof………
It does make for a better deal until the area goes bad. You really have to be careful about that. It's happened to a bunch of commercial owners downtown recently. If you can't fill the property or if the businesses go broke you simply can't make money and you can't sell for what you have into it.
Fortunately it’s in the lower east side industrial district, where values continue to rise (and the protesters/Antifa generally ignore). And we have a terrific renter. The main reason he rents it is that it is catty corner to his own building and has a ton of off street parking for his service trucks (The City of Portland really made parking very problematic….and potentially costly…..in that area). We actually get purchase offers on a very regular basis. The trick is when to know when to pull the trigger…..
I don't know that any renter could pay me enough to be their landlord. It's only one step up from being restroom attendant for the homeless. barfo
