Worst Property Mistake ….Ever!!!!

Our first property purchase – we paid top dollar in late 1993, just before prices crumbled. We bought for $111K in East Ipswich, and after spending $20K in renovations, ended up selling for $85K 5 years later… at that time, it was a huge loss to us. Still not a regret though – we learnt a lot from that experience, ie that you can't just buy anything at any price and it will go up. Both sets of parents had always experienced this and had told us that we "couldn't go wrong" with property. We learnt not to rely on generalisations like that but instead do some research…

And had we not sold that property at that time – even at a loss – we couldn't have gone on to make the other, more profitable investments, that we've had since that time.

my worst mistake was allowing bad tennants walk all over me. AGain and again they were late with their rent. I would send appropriate forms but always a sucker for a hard luck story that they always fed me. I put it in the hands of an agent six weeeks ago when i hadn't had rent for six weeks and the useless agents havent received any rent from them either in the past six to seven weeks and hadn't done a thing. I made two calls to the agency but the person mananaging my property(if indeed she exists) was never available.

 Last wed I visited the house with the maintenance man and flew into an almighty rage when I saw the house.The house and  yard  is trashed adn they have dogs (not in the lease) and puppies inside on the  carpet. I would've cried if I wasn't so filled with rage. After giving the tennants what for, I marched into the agents office to get some answers.  I 'm not sure if this real estate manager had acreditation, more likely he had a psychology degree cos he managed to calm me down without  a drop of vodka. Anyway we started a plan, first being a maintence check on those pesky smoke detectors so we could get 24hr entry.

next day we turn up, no one home. the psycologist (oops sorry the agent has forgotten to bring keys so went back for them*^^*&()^^%&*)(T%R$#!!!!! Meanwhile I climb thro the window as any enterprising home owner does and was disgusted with what I saw. Of course it was rather unfortunate that when I opened the front door all the dogs ran out, never to be seen again.

Now this saga is going to continue but I'm no longer stressed about it. It will run its  course and after court  I will probably get $2/wk for the next 100 years, but it doesnt matter. This was a learning experience for me and eventually these people will be out. And frankly in the scheme of things, it is a minute hiccup. If this was the worst that ever happened to me , my life would be charmed.

But what I wanted to say to cu@thetop and others, mistakes are learning experiences that should never be repeated.  I dont believe in dwelling on the past on 'what I shouldv'e done". You can't change the past so concentrate on the present. Have goals but the future hasn't arrived yet so it is a realm of possibilities and that's exciting.

I wonder Terry if the fact that you were rejected for your first loan was a major factor in becoming a mortgage broker.  Sometimes we make good out of what was a bad experience.
milly

 
Spot on, Milly, I'm glad you can already have some perspective. My Dad always told me that if you've only got problems that money can fix, you should be very grateful. He's very wise, my Dad.

Once again, absolutely! I think that the ability to learn from mistakes, then quickly move on and look forward, which I've deliberately cultivated and am getting better at each year, is one of the most valuable character traits one can have, not only in investing but in life.  

Best wishes to you, Milly. You have a winning attitude and I'm sure it will work out OK.

Oh, mez67, I am sorry to hear that the house was in such bad condition. Thanks for sharing your situation with others so that hopefully they will learn the lesson cheaper than you did! I do hope that doing the subdivision retrieves the situation for you.

Thanks trakka and milly for your encouragement. Property investing isn't for the faint hearted thats for sure. But as  a wise man once said "problem + solution = profit ". I'm already doing the sums so onwards and upwards.

Milly, look forward to hearing the results of your court case. hopefully my court case result is as good as your prediction. i was thinking 5 cents a year for next 500 years would be an interesting result. yes i used to 'trust' everyone and thought that everyone told the truth. good lesson for me. and you are correct learn and live it

My biggest mistake list is way too big for here!!   

But a fairly consistant one is not trusting my judgement and not INSISTING that when I DO know best to INSIST that those working with/for me must abide. This includes:
* Not insisting rents paid on time/ homes are cleaned up/ etc
* That tradies do WHAT I WANT, not what they want
* That strategies are implemented that I WANT, not what others (usually for their own hidden agenda) want

I have found that most of these problems have been (although sometimes too late for first time) resolved by sheer hard work, persistance and above all EDUCATING oneself!! 

As a direct result of making way too many "mistakes", I have gone out and read, and read and read, and asked qu's, and gone to courses, asked more qu's, demanded answers, dabbled, made mistakes, continued learning…………………………..and I expect this cycle will never end.

Life is after all, a big lesson.

May as well share with group.  The saga of my worst mistake.

We bought a rundown property in Liverpool (UK) while living in London.  We did a flat conversion turning it into 1 three bed and one 1 bed flat.  Given we were about 400km away it was very difficult organising tradespeople.  Quotes to do the work we wanted ranged from £20,000 – £80,000. 

They constantly let us down and it took twice as long as it should have.  Not to mention we didn't visit the place in three months due to other committments and when we did get there found that the people who had replaced the doors had left them unlocked and all my tools had been stolen.   The moron who stole them obviously didn't realise they had Australian plugs.

The major work finished and between the trademen leaving and the tenants moving in (about 2 weeks) everyone in the vicinity had taken the opportunity to use the back yard as a community skip.  There were couches, old beds etc everywhere.

The letting agents we chose seemed fine.  They were however largely incompetant.  Messages would not be passed from one person to the other in the office and consequently unless you got every single person in the office on the phone nothing got done.  Then it was the landlords fault when they talked to the tenant even though we had told them to do any work required.

Within the first few weeks we had our first maintenance call where the tenant had put some things down the toilet that should really never have been flushed.  We found out that the offending material had been left in the back yard by the plumber when he unblocked the drain.

Around xmas that year we got a letter asking to terminate the lease when the electric oven exploded and the exploding shards of glass narrowly missed the tenants child.  We of course said fine by us, and immediately replaced the exploded oven and the one in  the upstairs flat which was of the same make.

The flat was rented again and we decided that managing something so far away was too annoying, and decided to sell. 

We had recieved a request from the tenant about 3 months previous to this to  fix the lights in the common area.  We immediately sent something back to the agent saying do it because its a safety issue. 

A week before the auction a letter arrived from the council telling us they had been contacted by the tenant about the lights in the common area (which we had told the letting agents to fix 3 months ago, but they had not done it) and that the council had taken the liberty of inspecting the property against the building code while they were there.  Since they inspected it after the flat conversion and approved it, there had been several changes to the building code and the height of the banister which spanned 3 floors had to be raised by an inch, as well as some other minor things adding up to around £3,000.  Just what you need a week before the auction.

Anyway sold the place and apparently the curse struck the new owner within days.  I would feel sorry for him but he got it for a good price.

Anyway hope this at least entertains someone. 

Positives to come out of this were that I now don't fear doing most kinds of work to a property.  I got a lot of experience in managing and planning a refurbishment.  I now do not trust anyone providing services until they have proven themselves although I was always a complete control freak.

I won't buy property in areas more than an hours drive from where I live.

In case you are now thinking that this is not for you we also owned another 4 properties in Australia which gave us no trouble at all.

Alright here goes.  Moved to Newman WA in November 2001 with family to work and get together a deposit for a house.  At that stage half the town was in moth balls.  There was plenty of work for contractors (my husband is a sparky) and life was good.  You could of picked up a house for $40,000 or $50,000 if it had a pool and the rent was $200-$270 a week.

So we decided to buy in Perth we bought two properties within a year.  Not a bad buy thanks to the boom but if we had of bought houses in Newman with the equivelent borrowings we would be comfortably retired by now.  We did buy a house eventurall and made a very good profit.  Ah the one that got away.

But wait there is more.  I will finish my story here because it will benefit no one.  I have learnt a very good lesson, go with your gut feelings and never give up until you have exhausted ALL avenues.

And the bargain of a life time is just around the corner and can be found everyday.