HsiaoChu
Recycles dryer sheets
- Joined
- Feb 26, 2010
- Messages
- 389
Have you ever considered owning rental property? Although many do not choose this option, it could be a good way to boost your retirement income. If you were to purchase a multifamily unit (4-6 units), you could potentially speed up the date you are able to retire.
Oh, Oh, Oh..... be very careful with this one. Unless you love being a land lord and you enjoy fixing things that are broken, and dealing with stupid clueless tenants, etc., this may not work out at all for you.
I have one rental in a resort area. I only have it because I need it to pay the mortgage. The rental is on my retirement house. When I bought the property with more than 20% down my mortgage was 6.02, and I was paying about $1400 in mortgage, 200 in taxes, and 125 in insurance per month. My renters gave me $1000 a month, and they paid untilities. In the first year, I replace the hot water heater for $600, $1000 worth of plumbing issues, and the cookstove for $600. In the second year I replaced the dishwasher, and had another $400 in plumbing issues as well as electrical issues. Before they even moved in I had to put in about $4200 in heating equipment.
I live in fear of a major problem with the well, or the septic system.
This year I got new renters. The old renters tore up the carpet because they said it was musty and put it in the garage with my permission, but now it is musty, so I have to go up and put pergo down for about $1000, which would be about $2000 if I had to pay someone to do it. The toilet mechanism in the bathroom has died twice to the tune of $55 each. On and on it goes.
My brother used to be a landlord and got out of it since it was nickel and diming him to death along with the occasional multiple Franklin. He now is a very large rental management company of more than 500 properties, and he deals with the renters.
There is nothing easy streak about owning rentals unless you are very very frugal, very very smart, and have a skin as hard as diamond.
HsiaoChu