Tell Us Your Real Estate Horror Story

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Tell Us Your Real Estate Horror Story

Ted KaaschPro Member
Real Estate Agent · Omaha, NE · Member since 2017 · 112 posts · 62 votes

On a recent podcast of REIA Radio #70 with Jamil Damji was asked this question. He responded that they found a dead body in the house he was walking.

What have you found in your investments that make people cringe?




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Leo R.
Investor · Member since 2021 · 591 posts · 695 votes
3y

@Ted Kaasch Long story, but a good one:

Back when I was a relatively inexperienced investor, I got a 2 am phone call from a tenant. The finished basement (which included bedrooms their children were occupying) was flooded with 6 inches of water! Worst of all, it was ground water--coming up from underneath the slab, and there was no easy way to stop the flooding.

Adding insult to injury was the fact that this was the third time in six months the house had flooded. After the first flood, I dug some French drains around the exterior of the house. After the second flood, I dug out a standard-size sump and installed a pump in the basement. No dice. Clearly, I needed to pull out the big guns.

Every bone in my body wanted to sell the house, sell all of my properties, and quit RE investing. The next several months were extremely stressful; the tenants left, I watched my bank account get lower by the day, and I spent every waking hour trying to figure out a solution. ...for weeks, I thought I was headed for bankruptcy, and I assumed the entire house would need to be razed (who would buy a house that has regular, unpreventable floods?). Plenty of people made fun of me for this debacle... It was one of the most demoralizing experiences of my life.

I hired a hydrologist who helped me understand how water moves underground, and potential solutions (best few hundred bucks I’ve ever spent). Unfortunately, none of the solutions he proposed were easy.

I stripped the basement of its finishings, jackhammered through the slab, and dug three sections; one was about 15x5, another about 12x5, and one about 20x5. All of them were dug about 4.5’ deep. Worst of all, the basement had no exterior door, which meant that approx. 30-40 tons of water-logged clay had to be removed by hand, one bucket at a time, through a window! (I put my gym membership on hold that winter).

Then, I installed industrial-grade perforated pipe that was roughly 3’ diameter (the type of thing you might see kids crawling through at a playground), and three industrial-grade sump basins, each of which were 65+ gallons (large enough for a full-grown adult to crawl into). The pipe and basins had to be sourced from a company that provides supplies for city infrastructure (this ain’t stuff you can pick up at Home Depot). I added an industrial grade pump to each of the three basins, each of which I plumbed separately.

Then, I back-filled everything with sewer rock (which, again, had to be brought in by hand, one bucket at a time, through a window), and then I re-poured the slab and re-finished the basement.

THEN, I dug a pit along the exterior of the house: 10’ x 20’, and about 10’ deep. Again, all dug by hand (this was back when I had no money, and couldn’t pay for an excavator). Added more industrial-grade perf pipe, and a vertical access pipe so I could drop in another pump if needed. Backfilled with another truck load of sewer rock.

As luck would have it, that Spring was the wettest on record in our City—rain, rain, rain. Every day, I held my breath waiting for the new tenants to call me saying the house was flooding (talk about anxiety!). ….aaaand….nothing.

Many years later, and the basement has remained bone dry (knock on wood).

Even more astounding—I got a call from a neighbor who owns a house across the street, about 50-75 yards away. He told me he’s owned his house since the 1970s, and that his unfinished basement has flooded almost every Spring since he bought the place…until, you guessed it. He’s never had a flood since I finished my little project…So, it seems that my absurd drainage system is not only draining everything under my house, it’s also draining the entire surrounding area!

Today, the “flood house” is the best cashflowing property in my portfolio (the cashflow potential is a major reason I put in so much effort to fixing the problem).

Every time I hear someone mention REI as a "passive" form of investing, I smile and think back to when I was knee-deep in mud, excavating truckloads of clay by hand, one bucket at a time through a basement window. "Passive" lol.

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  • Austen Mueller
    Real Estate Agent · PA · Member since 2021 · 240 posts · 131 votes
    3y

    As an agent I was showing a home in PA. Male tenant opened the door fully naked! Long story short clients still saw the unit (NOT my idea) and what do you know. didn't want it. 

    3Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    I bought and flipped a house that had shackles on the wall in the bedrooms....

    6Reply
  • Karl B.
    Rental Property Investor · Erie, PA · Member since 2015 · 1k+ posts · 2k+ votes
    3y

    Here's a common one: when you evict a tenant and they had the electric turned off but left the food in the fridge.

    Numerous bugs had laid eggs in the appliance (flies and fruit flies) and the old chicken stunk badly. I not only cringed, but dry heaved again and again, and only got through it by imagining myself walking into the prothonotary office and filing a lean against the tenant for money owned. 

    5Reply
  • Scott E.
    Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
    3y

    I bought a house as-is that had mold, termites, a squatter, a failed septic tank, no utilities, no windows, and rats.

    It ended up fine though. These problems are solvable. All it takes is time and money.

    8Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    Time and money will solve a lot of issues :-)

    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    I can't even tell my worst stories on here, it's a family show....

    1Reply
  • Scott E.
    Contractor · Scottsdale, AZ · Member since 2010 · 2k+ posts · 3k+ votes
    3y
    Quote from @Bruce Woodruff:

    I can't even tell my worst stories on here, it's a family show....


     LOL! I guess we can only imagine...

    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y
    Quote from @Scott E.:
    Quote from @Bruce Woodruff:

    I can't even tell my worst stories on here, it's a family show....


     LOL! I guess we can only imagine...


    Don't, it's too disgusting... :-) You never realize how twisted some humans can be until you actually see some things.....I must live a really boring life...

    2Reply
  • Leo R.
    Investor · Member since 2021 · 591 posts · 695 votes
    3y

    @Ted Kaasch Long story, but a good one:

    Back when I was a relatively inexperienced investor, I got a 2 am phone call from a tenant. The finished basement (which included bedrooms their children were occupying) was flooded with 6 inches of water! Worst of all, it was ground water--coming up from underneath the slab, and there was no easy way to stop the flooding.

    Adding insult to injury was the fact that this was the third time in six months the house had flooded. After the first flood, I dug some French drains around the exterior of the house. After the second flood, I dug out a standard-size sump and installed a pump in the basement. No dice. Clearly, I needed to pull out the big guns.

    Every bone in my body wanted to sell the house, sell all of my properties, and quit RE investing. The next several months were extremely stressful; the tenants left, I watched my bank account get lower by the day, and I spent every waking hour trying to figure out a solution. ...for weeks, I thought I was headed for bankruptcy, and I assumed the entire house would need to be razed (who would buy a house that has regular, unpreventable floods?). Plenty of people made fun of me for this debacle... It was one of the most demoralizing experiences of my life.

    I hired a hydrologist who helped me understand how water moves underground, and potential solutions (best few hundred bucks I’ve ever spent). Unfortunately, none of the solutions he proposed were easy.

    I stripped the basement of its finishings, jackhammered through the slab, and dug three sections; one was about 15x5, another about 12x5, and one about 20x5. All of them were dug about 4.5’ deep. Worst of all, the basement had no exterior door, which meant that approx. 30-40 tons of water-logged clay had to be removed by hand, one bucket at a time, through a window! (I put my gym membership on hold that winter).

    Then, I installed industrial-grade perforated pipe that was roughly 3’ diameter (the type of thing you might see kids crawling through at a playground), and three industrial-grade sump basins, each of which were 65+ gallons (large enough for a full-grown adult to crawl into). The pipe and basins had to be sourced from a company that provides supplies for city infrastructure (this ain’t stuff you can pick up at Home Depot). I added an industrial grade pump to each of the three basins, each of which I plumbed separately.

    Then, I back-filled everything with sewer rock (which, again, had to be brought in by hand, one bucket at a time, through a window), and then I re-poured the slab and re-finished the basement.

    THEN, I dug a pit along the exterior of the house: 10’ x 20’, and about 10’ deep. Again, all dug by hand (this was back when I had no money, and couldn’t pay for an excavator). Added more industrial-grade perf pipe, and a vertical access pipe so I could drop in another pump if needed. Backfilled with another truck load of sewer rock.

    As luck would have it, that Spring was the wettest on record in our City—rain, rain, rain. Every day, I held my breath waiting for the new tenants to call me saying the house was flooding (talk about anxiety!). ….aaaand….nothing.

    Many years later, and the basement has remained bone dry (knock on wood).

    Even more astounding—I got a call from a neighbor who owns a house across the street, about 50-75 yards away. He told me he’s owned his house since the 1970s, and that his unfinished basement has flooded almost every Spring since he bought the place…until, you guessed it. He’s never had a flood since I finished my little project…So, it seems that my absurd drainage system is not only draining everything under my house, it’s also draining the entire surrounding area!

    Today, the “flood house” is the best cashflowing property in my portfolio (the cashflow potential is a major reason I put in so much effort to fixing the problem).

    Every time I hear someone mention REI as a "passive" form of investing, I smile and think back to when I was knee-deep in mud, excavating truckloads of clay by hand, one bucket at a time through a basement window. "Passive" lol.

    15Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    @Leo R. Lol, any way you can charge that neighbor for your efforts?

    1Reply
  • Account Closed
    Rental Property Investor · Mount Dora, FL · Member since 2017 · 33 posts · 35 votes
    3y

    I listed a duplex for sale & when the agent went to show it for the first time, squatters had moved in. They broke a window to get in and smoked all sorts of stuff in the home. The smell was horrible. It took a few weeks to get them kicked out & over $1k in cleaning & repairs. The home was finally ready to be shown again & boom… the same squatters were back again. This time they broke a back door & moved a whole bunch of crap in. A few weeks later we got them out again. Another $1k in cleaning & repairs. I took the next offer & got rid of it asap. The hassle & stress involved with that deal was not fun!

    1Reply
  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    3y

    Many stories for you... here are two:

    Dead horse in the bedroom, the whole smelling creature. Since @Bruce Woodruff says this is a family PG show I cannot describe what it took to clean up.

    Ghost of contractor who died on site. (heart attack) Wife who was not licensed or knowledgable tried to complete the 21 units. Mechanics liens from her. Strange things happened when the project was completed. Tenants said they saw him on the roof or in the hallway with a metal box of keys jangling. One tenant charged for haunted sightings in his unit ($500 a night) and the ghost dog and pony show paid his rent. His unit had no air conditioning but was always freezing. Windows from his unit faced the Hotel California. The tenant decorated his unit with all sorts of Victorian creepy oddities. Sold that building. Both buildings are torn down and condos there now. 

    2Reply
  • Leo R.
    Investor · Member since 2021 · 591 posts · 695 votes
    3y
    Quote from @Bruce Woodruff:

    @Leo R. Lol, any way you can charge that neighbor for your efforts?


     lol; I wish...this was one of those jobs that didn't cost a ton of money in terms of supplies, but cost a fortune in sweat.

    I can't even imagine how much it would have cost to hire pros to do this (assuming you could even find a pro to take on the job).

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    3y
    Quote from @Ted Kaasch:

    On a recent podcast of REIA Radio #70 with Jamil Damji was asked this question. He responded that they found a dead body in the house he was walking.

    What have you found in your investments that make people cringe?





    Maybe it was one of my houses in Indy that had a dead body in the basement that a wholesaler found..
    Podcast Guest on Show #222
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    1Reply
  • Owen DashnerPro Member
    Lender · Omaha, NE · Member since 2008 · 1k+ posts · 1k+ votes
    3y

    @Leo R. the fan has me cracking up - I'm sure it's doing a lot of good drying that out LOL!

    1Reply
  • Shawn McenteerBusiness Member
    Realtor · Boonton Township, NJ · Member since 2013 · 2k+ posts · 1k+ votes
    3y

    I have the worst horror story.  My first property I purchased with a local family friend real estate agent with no investing experience. :) Fortunately shortly after I found BP and changed things around

    973-975-3895
    House Hacking New Jersey563 Reviews
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    2Reply
  • Leo R.
    Investor · Member since 2021 · 591 posts · 695 votes
    3y
    Quote from @Owen Dashner:

    @Leo R. the fan has me cracking up - I'm sure it's doing a lot of good drying that out LOL!


     Lol, yeah--ventilation is key when there's a trench with 2' of water in it, and piles of mud in your basement   ;)

    1Reply
  • Richard F.
    Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
    3y
    Aloha,

    Wow, tough question...there are so many possibilities...

    I will start with just saying I HATE to get calls to meet for a wellness check from a resident's family/friends or PD, and leave it at that. You name it, I have seen it in this category.

    We took on management of a portfolio of properties for a client, and were advised one was occupied by siblings that had fallen behind on rent. I arranged a meeting to inspect the home and discuss the situation, but on arrival I quickly noticed two issues. Both of the residents had mental challenges, and, there was a very odd, but strong odor notable from outside the house. On inspection, the main floor living area looked normal and fairly neat, but when I opened the door to the basement and turned the lights on, all I could see was about 5 foot deep garbage filling the entire basement. All of their food waste, and typical household rubbish had been dumped down there for years. We went through a lengthy eviction, then hauled out two 40 yard dumpsters worth just from the basement.

    Then there was the fire we had in a duplex unit, started by refugees that had rented under a special program at the time. They had built a campfire in the livingroom to cook on.

    I've had three different incidents where a car was driven well into a residence. The worst was one that crashed through a second floor wall from a street on the hill behind, caused enough damage that the floor collapsed dropping the car down to the first floor. Fortunately, no one other than driver was hurt, but quite the challenge to remove the car!

    Looked at a SFH that a couple had lived in for years, but when the husband died, the wife moved to another house they had on the block that was smaller. When she left the first house, it looked like she just walked out, with table settings in place, magazines on the countertop, fully furnished. She would walk over to this house every day to feed her house cats. I lost track at about 45. Did I mention she had moved out 7 years before I saw...and smelled the place?

    Did you know that the Flash/Bangs that PD uses to make a surprise entrance for a bust are great for popping all the nails on sheetrocked walls?

    A Client bought a MF property through an acquaintance of theirs, it had an on-site "manager", and 15 units according to the paperwork I was provided initially. 2 of the "apartments" were under one of the houses (post and beam construction, all open). They had actually broken an exposed sewer line and placed an old toilet over the opening they created, and used a hose to flush it down. The dirt was covered with remnants of carpet for their "living" area. The "manager" was a working girl alright, just not the kind that screens tenants. The residents were an assortment of druggies, thieves, and drunks. We immediately terminated everyone, and of course started evictions, of which we ended up in court for 6 of them, with others actually seeing the writing on the wall and moving more or less peaceably. Except for one guy, that was kicking and screaming all the way...including a faked heart attack when the Sheriff was there to remove him. That bought him another 10 days, till they finally removed him. BUT, he created some rather extreme drama during the last throes of his tenancy by knifing tires of several people parked on the property, on multiple occasions, including mine. Unfortunately, my Client was at the property checking on some of the vacated units at one point when several tires were cut, and the guy actually called the cops accusing our Client of cutting the tires. This was really bad, because although the Clients wife speaks English, he does not, and he ended up getting arrested at the scene due to the language barrier. He spent several thousand on attorney fees and court appearances before finally being acquitted. I'm happy to report the now 9 unit legal property has had some good long term tenants continuously since the renovations were completed after old tenants were gone.

    One incident that did give me chills was another fire, this one in a SFH, split level with a partially finished basement. The tenants had moved someone into the basement without authorization, and they ended up starting a fire in the basement accidentally with candles. This occurred in the middle of the night, and obviously had been smoking heavily for some time before residents were awakened and managed to get out. When I went in the next day, there were numerous handprints in the black smoke along the walls where you could tell they were feeling their way out. The TV and other items on the upper main floor were melted from the heat of the smoke. Struck me as they were VERY lucky to make it.

    Then there was the time I was on a ladder changing a light bulb in the hallway of a MF property in a very rough area. Guy hanging around in the hall finally walks over, pulling a knife and demanding my wallet. I of course say "no problem" and reach into my back pocket...and pull out my .38. Guy runs off, never to be seen again. That was long time ago, and far from where I am now, but there are all kinds out there. Be aware. Always.

    Property Management....Ya Gotta Love It!
    1Reply
  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
    3y

    I wrote a whole article with many such examples a while back: https://www.biggerpockets.com/...

    Podcast Guest on Show #121
    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    3y

    @Richard F. That's quite a collection of horror stories there my friend....you might win this one....

    1Reply
  • Account Closed
    Homeowner · Kansas City MO · Member since 2019 · 30 posts · 8 votes
    3y
    Quote from @Leo R.:

    @Ted Kaasch Long story, but a good one:

    Back when I was a relatively inexperienced investor, I got a 2 am phone call from a tenant. The finished basement (which included bedrooms their children were occupying) was flooded with 6 inches of water! Worst of all, it was ground water--coming up from underneath the slab, and there was no easy way to stop the flooding.

    Adding insult to injury was the fact that this was the third time in six months the house had flooded. After the first flood, I dug some French drains around the exterior of the house. After the second flood, I dug out a standard-size sump and installed a pump in the basement. No dice. Clearly, I needed to pull out the big guns.

    Every bone in my body wanted to sell the house, sell all of my properties, and quit RE investing. The next several months were extremely stressful; the tenants left, I watched my bank account get lower by the day, and I spent every waking hour trying to figure out a solution. ...for weeks, I thought I was headed for bankruptcy, and I assumed the entire house would need to be razed (who would buy a house that has regular, unpreventable floods?). Plenty of people made fun of me for this debacle... It was one of the most demoralizing experiences of my life.

    I hired a hydrologist who helped me understand how water moves underground, and potential solutions (best few hundred bucks I’ve ever spent). Unfortunately, none of the solutions he proposed were easy.

    I stripped the basement of its finishings, jackhammered through the slab, and dug three sections; one was about 15x5, another about 12x5, and one about 20x5. All of them were dug about 4.5’ deep. Worst of all, the basement had no exterior door, which meant that approx. 30-40 tons of water-logged clay had to be removed by hand, one bucket at a time, through a window! (I put my gym membership on hold that winter).

    Then, I installed industrial-grade perforated pipe that was roughly 3’ diameter (the type of thing you might see kids crawling through at a playground), and three industrial-grade sump basins, each of which were 65+ gallons (large enough for a full-grown adult to crawl into). The pipe and basins had to be sourced from a company that provides supplies for city infrastructure (this ain’t stuff you can pick up at Home Depot). I added an industrial grade pump to each of the three basins, each of which I plumbed separately.

    Then, I back-filled everything with sewer rock (which, again, had to be brought in by hand, one bucket at a time, through a window), and then I re-poured the slab and re-finished the basement.

    THEN, I dug a pit along the exterior of the house: 10’ x 20’, and about 10’ deep. Again, all dug by hand (this was back when I had no money, and couldn’t pay for an excavator). Added more industrial-grade perf pipe, and a vertical access pipe so I could drop in another pump if needed. Backfilled with another truck load of sewer rock.

    As luck would have it, that Spring was the wettest on record in our City—rain, rain, rain. Every day, I held my breath waiting for the new tenants to call me saying the house was flooding (talk about anxiety!). ….aaaand….nothing.

    Many years later, and the basement has remained bone dry (knock on wood).

    Even more astounding—I got a call from a neighbor who owns a house across the street, about 50-75 yards away. He told me he’s owned his house since the 1970s, and that his unfinished basement has flooded almost every Spring since he bought the place…until, you guessed it. He’s never had a flood since I finished my little project…So, it seems that my absurd drainage system is not only draining everything under my house, it’s also draining the entire surrounding area!

    Today, the “flood house” is the best cashflowing property in my portfolio (the cashflow potential is a major reason I put in so much effort to fixing the problem).

    Every time I hear someone mention REI as a "passive" form of investing, I smile and think back to when I was knee-deep in mud, excavating truckloads of clay by hand, one bucket at a time through a basement window. "Passive" lol.

     Such an inspiring story! I’ve had 2 big water damage issues in the first year of buying a house (not nearly as bad as this) - it was extremely stressful to fix but now it’s cash flowing ok. 

    2Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    3y

    Once checked on a property and found the occupant had hanged themselves in the basement.

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