According to
Forbes almost half of all the nation's landlords are "mom & pop's", owning 10 or fewer units. Count us among them. We bought our first duplex in 2010, the remaining 4 in 2012, for a total of 10 residential units and 4 storage units. They've all been paid for since the DH semi-retired in 2014 (completely RE in 2015). Rent has provided the lion's share of the money we've lived on since 2015 along with some from our savings. We're letting the IRA just grow. We're both on FRA SS as of last fall, so that takes a lot of pressure off the rentals, but we still want a decent return for our investment. The DH figures we had 14% ROI in 2021, pre-expenses (taxes, insurance, upkeep & repairs). After expenses, we dropped to 10.5% ROI. (We own a couple of stocks that didn't do that well this year!) We feel fortunate in this time not to have a mortgage.
When Covid first hit, one of our tenants who'd been with us almost as long as we'd owned the unit, lost his under-the-table job as a cook at a local greasy spoon. We asked if he could make half the rent, and he jumped at it. Paying half made it feel like we were in this together. Then he got a real job at another restaurant and became an actual taxpayer. He realizes now that he was short-changing himself by not having an on-the-books job. He's paid on time and in full since last April.
Some of our other tenants received emergency assistance from a local entity dispensing government funds. This was usually help getting their utilities current and a couple received enough to pay back-rent that was owed. We've only had to write off $1300 in unpaid rents since the virus hit.
We do have one tenant we are in the process of evicting. (Yes, it is still happening in the rural area of the admittedly red state we live in. Not trying to be political, just explaining the facts on the ground.) He has been letting unrelated people come and stay in his unit against our wishes and the wording of his lease. Several of our other tenants have expressed concern that there is drug activity going on, comings and goings at all hours. He refuses to pay his utility bill (even during the month when his rent was paid by that local charity, he couldn't be bothered to pay for heat and light!) We had to run to the City office to pay it so the heat could be turned back on and the pipes saved. He works. He just doesn't want to be responsible enough to pay. He's not covered by any anti-eviction mandate. We can't lose our good tenants because he and his unwelcome guests are scaring them. He has to go. He's received his 30 day notice to quit. The next stop (on Monday) is our attorney and a court date. It may still take another month, but we will regain our property.
But for the most part, our tenants are hard-working folk who appreciate a well-kept place to live. We work with them and they work with us. We never have trouble filling a vacancy. We have a reputation for making improvements and quick repairs. A week doesn't go by without receiving a call asking if we have anything available.
We have no plans to sell and hope to leave the rentals to our kids. But we are getting more picky about who we rent to. No discrimination here. We have rented to all racial, ethnic and sexual orientations. We have a reformed (non-violent) felon or two. We only consider green. We require our tenants to have income of 3 times the amount of rent so they won't be rent poor. We require a minimum credit score of 600. And if we have more than one applicant, we give extra consideration to prospective tenants with "essential" jobs. (Seriously, in these times, wouldn't anyone rather rent to a nurse?)
So far in our state, those are still legal criteria for us to use in deciding who gets to move into our properties. The rules could change. If they do, we'll change with them.
But I expect to die a landlord. Month over month, the reward for the risk is just too good.
