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View Poll Results: RE moguls represent! How many are rental owners?
I have owned rental real estate. 30 32.61%
I currently own rental real estate. 69 75.00%
I self manage. 35 38.04%
Rentals are my primary source of income. 7 7.61%
Multiple Choice Poll. Voters: 92. You may not vote on this poll

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Old 08-29-2014, 05:24 PM   #21
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We own 4 units spread across 2 duplexes. Cash flow neutral now, but all recently purchased units in a desirable part of town, so it should improve over time. I'm self-managing, but could transition to a property manager over the years as cash flow increases. One unit is currently vacant. Hopefully I'll get that corrected sooner rather than later. I cherish the monthly rent checks and try not to take them for granted. Rationale for RE investment was to diversify some funds out of stock market and gradually create another source of retirement cash flow. Managing has it's share of hassles (I spent all day today dealing with contractors, destroying a wasp's nest, changing filters, etc.), but I'm trying to take the long-term perspective. So far I'm optimistic that things will turn out positive in the end, both for cash flow and appreciation. Location, location, location!


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Old 08-29-2014, 08:24 PM   #22
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We have 33 units that we have had for about 25 years. They are in two complexes that happen to be right next to each other. One on-site manager handles both. We plan on keeping about 5 more years then sell with owner finance.
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Old 08-29-2014, 08:45 PM   #23
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Am currently 1/3 owner in a single rental home (along with 2 siblings) which we inherited from my mom. We use a manager, but I served as manager for awhile when my mom owned it. My dad had several rentals but gradually sold them off except for this one. He was a much better landlord than I ever was or will be. If it was up to me I would be done with it, but my sister likes the income (it's long since paid off). Any time I hear someone mention the prospect of owning rental property for the "easy income" I steer them toward an old movie "Pacific Heights".
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Old 08-29-2014, 09:58 PM   #24
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We have a condo in a tourist area that we self manage. It really hasn't been bad at all as a short term vacation rental and it does make a bit of money plus we get to use it whenever we want as long as we block off the dates on the reservation calendar. We are looking at buying another one in the next year or so.
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Old 08-29-2014, 10:14 PM   #25
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Quote:
Originally Posted by chilkoot View Post
..... Any time I hear someone mention the prospect of owning rental property for the "easy income" I steer them toward an old movie "Pacific Heights".
You are a very mean person. That movie made my tummy hurt. for years.
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Old 08-29-2014, 10:29 PM   #26
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We have 33 units that we have had for about 25 years. They are in two complexes that happen to be right next to each other. One on-site manager handles both. We plan on keeping about 5 more years then sell with owner finance.

Sounds like we were buying in around the same time. We had planned on a gradual sell off starting back around the RE crash time - managed to sell a 5-plex end of 2013 and am giving a 7 unit next month to someone who would be inheriting anyway, then we will just content ourselves with taking rent payments for awhile unless someone else just has to own one of the places.

Must say that your two side by side complexes sound much smarter than our small complexes scattered over several towns in a 12 mile radius.. How did you happen into them - did you go from RE virgins to multi-landlords in one swell foop?
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Old 08-30-2014, 05:11 AM   #27
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. Any time I hear someone mention the prospect of owning rental property for the "easy income" I steer them toward an old movie "Pacific Heights".
Didn't see the movie, but read the comments on imdb. Wow, just wow. Lot's of real life stories that resonated with people. Also some creepy replies to those folks from some people that apparently identify with being the "creepy renter/squatter."

Just wow.
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Old 08-30-2014, 06:18 AM   #28
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Any time I hear someone mention the prospect of owning rental property for the "easy income" I steer them toward an old movie "Pacific Heights".
I saw the movie. Actually downloaded it from the pirate bay...

While the Pacific Heights might be a bit extreme, other similar stories are more common. BUT, they are mostly easy to avoid by doing a proper background check. And knowing how to interpret the check and making a proper decision based on it.

I think you will find far more horror stories in the stock market, from 2007, 2000, 1987, etc.

But that's why I have both. Plus a small pension and SS.
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Old 08-30-2014, 09:08 AM   #29
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We have one rental property - single family home (townhouse) that we lived in for a short time before being sent on assignment for DH's job for about 4 years. That is when we converted it to a rental. We have used a property management company since we were out of town. Now that we live back in town we continue with the property management company because it is the "easy button" for now. We have contemplated doing it ourselves but I always discourage DH from this b/c I know we are both "softies" and would not handle people being late with rent, etc. very well.

I recently ran a cash-on-cash calculator on it, and it looks like it is a 4% annual return. Not as good as I had hoped, but it still feels nice to have that monthly payment come in. We've had a few annoyances with the management company, but overall we are happy and don't have to deal with many issues related to the rental.
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Old 08-30-2014, 09:12 AM   #30
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We built a detached granny flat on the backend of our property. It was built for my in-laws as FIL was wheelchair bound and MIL was his caretaker. It allowed them to have independence, and still get caretaking support. That need is no longer there - so now we rent it out. We're in our first "non-family" tenure of tenants. (A niece rented it after my in-laws.)

We don't get the full gamut of tax breaks because it's part of our primary home parcel - the only thing that is separate from our primary, as far as bills is: power/cable/phone - tenant pays. insurance - which we can deduct. Property tax etc is all a single bill included with our primary home. We have no mortgage.

We get a pretty nice rental income - $1400/month. It's a nice place so we had a very nice selection of professionals to choose from to rent to. I agree with the comment that doing a proper background check is important. We ran full credit, employment verification, references on our tenants. They both work for megacorps that do background checks - so that's an additional level of background check.

Our longterm plan, once the kids are grown and launched, is to move into the unit ourselves and rent out the front house for larger rent. We'll use it as a base while we travel and explore the world. That's about 15 years from now. The casita has the advantage for our senior years in that it is designed to be wheelchair friendly.... one level, roll in shower, already outfitted with grab bars in appropriate places.

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I'm in the process of looking for new insurance (changing companies). During the application for umbrella coverage, I was asked probing questions about "other properties, including rentals" that I might have. (I don't have any.)

I don't know what this would do to my umbrella, but I'm just curious about the questioning.

So I ask you landlords: do you have an umbrella? If so, did it go up as a landlord? Or do you somehow make this a business or LLC side project?

Aside from inherited PSTD (after seeing what my grandmother went through), these legal entanglements are one reason I've stayed away.
We just added an umbrella when we switched to non-family tenants. We had to change insurance companies because AAA found reasons to dump us when I tried to add the umbrella. First they didn't want to issue a landlord policy (the casita had been covered under our homeowners when my in-laws were living there.) Their reasons were invalid so they backed off that reason. And came up with a fire risk reason. (Same risk as was present since we bought the house and insured with them more than a decade ago.)

The reason for the umbrella is to add an additional level of insurance above the landlord policy (which covers the structure - but not the contents of a rental.) It covers if a tenant sues you, etc. For us, it's worth the peace of mind. We have good tenants and a well maintained place, but I'd hate to be forced out of retirement because a lawsuit wiped out my retirement savings.
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Only My Mom's House, Under Special Circumstances
Old 08-30-2014, 09:30 AM   #31
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Only My Mom's House, Under Special Circumstances

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How about "Never owned a rental and never will, if I have anything to say about it!" ?

Taking care of my own house is more than enough work of that type, for me.
Long story short, DB and I hired a property management co. to rent out Mom's house last spring after we moved her (MOST UNWILLINGLY, on her part) into assisted living. (The doctor said she had no choice but to go.) She doesn't have the savings to stay there indefinitely. But her paid-off 3BR/2BA in a suburb of Sacramento has become our little cash machine. It provides $1,000/mo. toward her assisted living bill and about $400/mo. toward a maintenance acct. we established to cover taxes, ins., repairs, etc.

Because we sank $ initially into paint, new flooring and a few updates, we have very happy renters who've said they never plan to move. If we ever put the house up for sale, they've asked to be contacted first.

Mom has settled in now to her new home, and has admitted that she likes the way the rent is extending her savings.

For me, though, I wouldn't do it. (MY DB is a corporate CFO, so enjoyed setting all this up.........and he does live near Mom and the house. So it hasn't mattered that I'm 2,600 mi. away.)

Thank goodness!

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Old 08-30-2014, 09:31 AM   #32
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Own 3 rental Condo's. Purchased in 2010/2011. They were 4 to 7 years old when purchased. No turnover yet, so they have only required about 10 hours per year of my time. Net ROI is about 8% to 9%. Capitol appreciation has been about 75%. So far so good!!!
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Old 08-30-2014, 02:48 PM   #33
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Sounds like we were buying in around the same time. We had planned on a gradual sell off starting back around the RE crash time - managed to sell a 5-plex end of 2013 and am giving a 7 unit next month to someone who would be inheriting anyway, then we will just content ourselves with taking rent payments for awhile unless someone else just has to own one of the places.

Must say that your two side by side complexes sound much smarter than our small
T complexes scattered over several towns in a 12 mile radius.. How did you happen into them - did you go from RE virgins to multi-landlords in one swell foop?
I sold a start up at 27. I made a large down payment on the properties and paid off the properties while working.

The fact that they are side by side was dumb luck. I had a duplex and single family house but sold them years ago due to time constraints.
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Old 08-30-2014, 05:45 PM   #34
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Hi,

We have 4 rentals added since 2009. Appreciation with those has been good ~70%. Currently struggling whether to add another as finding it very difficult to get even 5% net on rents.

Not planning to fully retire for 10 years, but then rental income will be critical.
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Old 08-30-2014, 07:02 PM   #35
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I'm a member in an LLC that owns 2 Florida condos that are rented. We use a management agency for one, handle the other one ourselves. We sold another one in 2013, and would like to sell the current 2 within the next couple of years as my partners are getting old.
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Have 'em and semi retired because of 'em
Old 08-30-2014, 08:26 PM   #36
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Have 'em and semi retired because of 'em

We bought our first rental property in 2002 (a fourplex) and now have 29 units total, including 3 small apt buildings, some single family rental homes, and a couple of condo units. The two condo units are paid off. I quit my job about 18 months ago at age 49 and we now live off the rental income and income from flipping 1-2 houses per year. Hopefully neither of us will have to return to work any time soon.

Sure, we've had some tenants that have caused us grief, but we knew we would going in and we try to screen our tenants very carefully. We've also had some tenants that have been with us since we bought the first building.

We don't have any plans to sell in the near term, but maybe when we're 60'ish after our kids are off to college. The vast majority of our wealth is tied up in the rentals, but we also have approximately $300k in retirement accounts.
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Old 08-30-2014, 09:42 PM   #37
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We have a single rental property, but unlike most responding here, its purpose is not income or profit. It will be our retirement home in a couple of years. We bought it while the real estate market was down and area rentals were (and still are) in high demand. Tenants are paying the mortgage and other expenses until we are ready to use it.
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Old 08-30-2014, 09:52 PM   #38
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We also have a single rental property that will be our retirement home in a couple of years. The rental income is paying for repairs/upgrades to the property prior to our retirement to it so I am happy about that.
Would possibly consider buying another one if I could find something that was a great deal.
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Old 08-30-2014, 11:22 PM   #39
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I know a certain number here have rentals, but wonder at the percentage. I feel kind of like an outlier, as we got started buying ratty old places that we thought were cool and then had to make them pay for themselves, which resulted in a collection of rentals that ended up being our livelihood sans other meaningful employ for me. We now have a manager for most of the time, but the rentals continue to be our main repository of wealth and a primary funder of our annual income.
Currently have rentals, self manage. Dumb question, how do I access the
poll?
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Old 08-31-2014, 02:31 AM   #40
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We have one rental apartment located in a big city, half an hour from the small town we live in. I self manage, only one call in 3 years. 4% return + rising equity. Trying to decide weather to keep it when we ER just to stay in the ridiculously high market or sell it and never move back. It's a security blanket for the time being.
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