Yep – for the last four months I’ve been getting 29 rents out of a 28-unit portfolio. Here’s what happened: Want more articles like this? Create an account today to get BiggerPocket's best blog articles delivered to your inbox Sign up for free The Call I own a beat-up, white, 8-foot bed Dodge Ram pick-up truck. I don’t drive it full time; in fact, most of the time the truck sits at the curb in front of my house. I keep it around since it comes in handy when a stove or a refrigerator needs to be moved. But, for some reason unknown to me, all of the best calls about the best opportunities seem to come in while I am in the truck. It is virtually impossible to talk on the phone when I drive since every ding, rattle, and whistle known to mankind is present inside the cabin of this thing. So – I inevitably excuse myself and take a few minutes to find a place to pull over. This is what I did this past October when a call came-in while I was in-transit. The gentleman on the other end introduced himself as a representative of a national relocation company which specializes in finding suitable living accommodations for national and international corporate transfers. He explained that his company was engaged to source a 2/1 rental unit for three months for an international executive-level transfer that was coming to work for one of the main employers in Lima. He said that the client was going to buy a home here, and the rental was only needed for a short time – would I be willing? My Unit At the time I had one vacancy. This was a no frills duplex in a solid B Class residential area. It had been vacated the week of by a nurse who had been with me for three years and got a great gig out of state – she left the place in perfect condition; all I did was order the carpets to be cleaned. The unit is in a brick duplex; two bedrooms/1 bath on each side with a garage for both in the middle – very standard set-up. The kitchen is equipped with a refrigerator, stove, and dishwasher, and there is a washer and dryer hook-up off the garage. In terms of finishing surfaces, I use the same plush carpeting in a shade of beige, and matching rolled vinyl in the kitchen and bath in all of my units. I also use the same paint scheme, which I cannot tell you since it is trade-mark. Food for Thought: Rents in Lima range from $375 to $1,200, and I like to operate in the $600-$700/month price-point for apartments and $700-$850/month for SFR. Incidentally, in similar locations and quality of structures, I can get into apartments at no more than $45,000 all in, typically less, while singles would set me back about $60,000+, even if I were buying distressed. Seeing that I am a cash flow investor, I don’t see paying $20,000+ extra in exchange for about $150/month of rent as a value proposition, which is one of many reasons why I choose to operate in the multi space… Does this sound like your marketplace, or are things different where you are? Related: Tips for Renting Property During the Slow Winter Months Back to the Telephone Conversation I asked him how he found me. He said that he had spoken to every land-lord and broker listed in the yellow pages and nobody would entertain a three-month lease. His last hope was Craigslist.com and this is where he saw my listing – I had just placed the ad on the site the day prior. I told him that I would not rent the unit for three months, unless he solved the problem that that I had. I explained to him that I simply was not prepared to try and re-rent the unit in the middle of the winter (in retrospect, this was a good move considering the kind of winter we’ve had). The conversation was taking place in October, with the client needing to move in November, which meant that a three-month lease would have left me vacant in February… I could not agree to that knowing that I won’t have any trouble renting the units on a 12-month leasehold. But, I told him that because I am a nice guy I would indeed rent the unit for 6 months – long enough the get it back on the other side of cold season. Win – Win Well – even though his back was to the wall with having to produce, he was not authorized to engage for 6 months while only needing 3. He did, however, have a lot of latitude relative to the price-point, and this is the offer he made me: “So – if we rent the unit for 3 months, but pay you for 6 months, you would be OK with that?” My answer – how do I sign-up…? Yes indeed – this company placed a high-ranking executive into a rental unit that I advertised on Craigslist at $625/month and paid me $1,250/month. Furthermore, they asked and I agreed to extend 1 extra month, and thus for the past four months I’d been receiving 29 rents out of a 28 unit portfolio. While the company is paid-up through the end of the month, the resident moved on to better and greener pastures 4 days ago, leaving the unit in perfect condition. Having placed the ad on Craigslist I was able to re-rent the apartment in 1 day to a well-qualified person with leasehold starting on the 1st of the coming month for $700/month – 0% vacancy rate, and increase in rent from $625 to $700. This unit generated 16 rents within a 12-month cycle… A Couple of Teachable Moments Apparently, this is a good time to be a landlord – who’d have thought… There are lots of tenants out there looking for good product, which is driving rents up and vacancy down. However, rents are not going up across the board. A week ago I published an article entitled Newbies Take Note: Why You Shouldn’t Buy Houses for Under $30,000 which set off a firestorm of comments. In that article, I made the point that aside from Cash Flow, there are many other value centers which exist in higher caliber properties that do not exist at the bottom of the market. The current article showcases this reality… I still own a few houses that I bought before I knew anything, and I keep them nice. However, what they are and where they are is not conducive to either steady rent increases, or especially a scenario that I just described. Sure – the corporate rental thing was pure luck; at the right place, at the right time kind of a thing. And I realize that they agreed to it only because they were out of options and the unit was “nice enough” relative to location and structure. But, there is no way in hell that they would have ever agreed to one of those junkers I’ve got, no matter how nice they looked, as an acceptable corporate rental – they would have placed the client in a hotel! Related: How to Find Cheap Houses for Sale: 10 Tips for Smart House Shopping For Your Information I purchased this duplex in a package deal about 7 years ago. The deal was creatively financed 100% (surprise, surprise). My current equity position in this duplex is no less than 20%. The rents in this duplex went from $550/month at the time of acquisition to now $700/month. Throughout the years, I’ve creatively liquefied the equity in this building to bridge it into acquisition of more wonderful assets just like it that throw off cash flow and appreciate in value. I plan on holding onto this building forever, or until someone offers me so much money that I’d be stupid to say no… Conclusion Success in investing is a function of options – pure and simple. You should never place yourself in an environment whereby there is only 1 way to win. It should never be – there is a way to win. I should rather be – which way will I win first? Having said this, relative to long-term rentals it is imprudent to own things that pigeon-hole you into one section of the market. For most of us, therefore, it makes a lot of sense to own that which most people want and can afford. Some of us want to be at the bottom of the market because it cash flows the best, while others want to be at the top because it’s clean and new. There is a balance to be had: Good locale, but not the best. Higher rent, but not so high that most couldn’t afford it. Not too old, but not too new. Comfortably amenetized, but not every bell and whistle known to man. Own that which people want and can afford, and in doing so you will find Cash Flow, Rent Growth, Value Appreciation, Financing Options, and a few nice surprises such as what I described in this article along the way. Good Luck!