Hi Forum,
Maybe this has been addressed in Steve’s book but I haven’t got a copy yet. I’ll ask the question anyway …
Do you get decent tenants in these positive return properties?
If the rent covers repayments and running costs and the purchase price is relatively low then why aren’t tenants buying themselves.
Cheers,
DG’day Di,
I think in any strata of society you risk getting bad tenants.
I know of some friends in retail who run different accounts, and funnily enough, they reckon a lot of the time, the people from the lower socio economic group pay on time more so than their well heeled cousins.
Individuals all have their own stories to tell, maybe they’re in the process of getting a divorce, maybe they like their beers, smokes and pokies more than the commitment of buying a house (it’s a free society)… maybe they can’t get a regular job (often through no real fault of their own)… maybe they don’t see themselves living in a particular area for more than a year or two so they’re happier renting… perhaps they’re scared of committing to a big loan if their job isn’t secure… maybe they are a one income family where the budget is stretched to the limit just covering day to day living expenses for kids etc etc… all I’m saying is that home ownership isn’t something that is neccessarily achievable or appealing to everyone, but the thing that EVERYONE has in common is the need to have a roof over their heads, that’s good for us… but the fact that someone can’t afford to, or doesn’t want to, buy a home, doesn’t make them indecent… I’ve found along the journey that a lot of people who perhaps don’t have it as good as some others actually have a better perspective on life and appreciation for the little they have than some others who earn good money and own (or are paying off) all the latest “toys”…
Like I said at the top, there’s good and bad in every bit of society, race, town etc etc…
have a good one!
rDi, buying a IP doesn’t always come with good tenants. In fact, many people here would probably have come across bad tenants, which is no big deal as long as you know how to manage them.
Steve McKnight mentioned this in his book and how he massaged them and get them behave well, giving incentives and nice surprises but there are occasions that he had to pull the plug and lose some $$$ while it is vacant.
Similarly for renovation works, he and his father and Dave tried one and earned $8000 plus over 6 months, not according to schedules and decide that renovation is not for him
You have to identify what is for you and what you are passionate about.
If buy and hold is not your favourtie, try reno, wraps or flips.
Hi Di
In my experience, using a property manager, the tenants have been no problem (4 out of 4 properties) [
].All properties have been clean for inspections, they have had work done in the gardens (inc. new plants etc). Normal wear and tear.
The only problem I had was with one property (it must be jinxed) when the neighbours car went out of control and smashed through the front garden and fence, and a couple of months later the tenant did a runner leaving the place empty over Christmas. With landlords insurance and bond, there was no problem.
Tas [
]Hi D
We had bad tenants in our negative cash flow IP. The agent didn’t even let us know what had happened. We found out from the monthly rent statement that the tenants had already left. We rang the agent many times & didn’t get any return call for 2 weeks. At the end we got hold of 1 staff. He told us the tenants were evicted out.
We visited the place last weekend, a screen door was ripped by their dog, a window frame was cracked from rain water, the carpet looked old … We cleaned up the kitchen, bathrooms, watered the garden, the grass are all dried up in back garden … We replaced the water sprinkler, put in toilette paper rolls … It was a beautiful new house over a year ago. [
]We always have very good tenants in our positive cash flow IP which we have managed ourself. The last couple just moved out to their new house. They gave me goodbye hugs & kisses. [
]So it depends on your luck.
Huey
Hi there,
I think it depends on the tenants motivation. I was always taught “You don’t s..t where you eat” I’ve known people who’ve rented for over 40 years in the same house and other than normal wear and tear the house is immaculately kept.
In 6 months, I will send out a gift voucher to our ‘tenants’ to thank them for keeping the property maintained and garden tidy…
I guess another question you can ask is..What type of landlord are you? Does the quality of the tenant really depend on whether the house is -ve or +ve cash flow?
Huey, that’s an awful thing to happen to a new house! I hope your next tenants are better than the last.Cheers
Sooshie []“small steps make the journey” (SAS)
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