Real Estate Investors Do the Dumbest Thing!

33 Replies

Ok , I've done some stupid things over the years but one came to mind today when i was new new new.  I was helping a handyman trying to be a general contractor who was working on a project trying to learn.  He sent me to  the store to get a bunch of quarter round.   So i went to the store and thought hey, this stuff wont go on the car so I'm going to get it all cut in smaller strips..... went ahead and did that with all of them and got back the guy was not happy.  I didn't know there was a purpose to having it long runs.  So he went back to the store and got a whole new batch.  

Have you done anything dumb in your real estate investing career? 

I like the concept of this thread. Not sure I want to admit the dumb stuff I have done as an investor.  Most of which revolve around me hiring tenants to do work for me.  I could imagine me doing that with quarter round though.

@Account Closed Did not due my due diligence on a tenant even though there were signs everywhere that the person was disorganized, lazy and dirty. 

Learnt my lesson the hard way. Apart from paying the rent on time, the biggest pet peeve of mine is when people are not clean and decide to live in filth. I just can't stand it!

Rented a tenant a house with central air conditioning , never having turned the unit on to make sure it worked. It didn't.

Honorable mention: Flipped two apartments for free, a studio and a one bedroom, for love of a girl that I broke up with right after the second renovation. This is honorable mention because I still thank my lucky stars every day for realizing that a woman who complains every day of a job about how slowly I'm making her money isn't cut out for life as a handyman investor's wife.

A little more extreme than the quarter-round story: As a young starving realtor a long, long time ago (pre-McRib & internet era), bought my first 3 rentals for 0 down and the rents just covered PITI. I had no $$ for maint or capex reserves. You can see where this is going. I wound up dumping all 3 properties ~18 months later.

The upside - I learned a lot that helped me going forward when I recovered. Have done pretty good since. 

@Jeffrey Holst Been there done that . 

@Omar Khan  I will still do that and hope out it turns out better than it should.  It doesn't :) 

 
@Jim K.  Thats a great one and very good honorable mention . 

@Anthony Wick  Are you familiar with the theories on the McRib?  https://en.wikipedia.org/wiki/McRib  See limited availability column. 

@Dave G.  I know exactly what you mean, no or little reserves will eat you whole. Its tough because the investor self is like "Hmmmm Idle cash?  Lets put it to work earning a return " But then you need that idle cash and your like hmmm " Not even enough for a McRib..... " 


Thanks all, any more comments are welcome. 


Hers another one. 

I  hired two 400 pound tree trimmers.  The logical side of my mind was not working that day. Nothing mean of them about being heavier but climbing trees as a day job?  

It was also a friend of a co worker.  Needless to say after all the low hanging branches were cut and they wanted more money (yes i gave them a deposit which was the only tree job I've ever done that on i think) looked them up on google and some mug shots of recent armed felon stuff. 


Got out of that one less a deposit lost.   Happens to the best of us, right?  :) 

Quick update, people of the thread, BP is trying to shut down the McRib gag...it was good while it lasted, but it looks like the limited availability is up. I'd like to thank all of you for making the party as memorable as it was. Special thanks to Omar Khan for coordinating our SW branch and helping us expand into Canada.

@Dave G.

@Omar Khan 

@John Woodrich

@Anthony Wick

@Jack Baczek

@Jim K. They took down my McRib program comment yesterday for “self promoting lol”. I guess sarcasm can’t be detected well by the algorithms. I have been lucky so far (I am still newerish at this) to not make any horrendous mistakes so far but my favorite was last year I paid 900 Bucks to an attorney to make my single member llc. What a waste of money. So learn from me if you need an llc when starting out (you don’t), do it yourself or use legal zoom (assuming single member) PS you don’t need one.

@Caleb Heimsoth

I wouldn't call that stupid at all, Caleb. The only way I figured out an LLC wasn't worth it for us was following the exploits of another guy I met with 25 long-term rentals. Never got an LLC, owned them all in his name, was a totally standup self-managing fixer landlord, sold them all in 2015 and retired. Apparently, he was a set carpenter for Mister Rogers' Neighborhood back in the day.

Originally posted by @Jim K. :

@Caleb Heimsoth

The only way I figured out an LLC wasn't worth it for us was following the exploits of another guy I met with 25 rentals. Never got an LLC, owned them all in his name, was a totally standup self-managing fixer landlord, sold them all in 2015 and retired. Apparently, he was a set carpenter for Mister Rogers' Neighborhood back in the day.

Ill get another one eventually but it’ll be a few years.  For me it’d just be nice to eventually get my name out of the public record.  Everyone is different though

@Account Closed

I hired a Belarusian-immigrant father and son team once to do tile work on my home for me. They showed up on the job site wearing matching ankle monitors, the father for beating his daughter for prostituting herself, the son for multiple DUIs. They royally botched the job and didn't finish in the time they promised, we threw them out, and that's how I learned how to do tile.

Originally posted by @Jim K. :

@Account Closed

I hired a Belarusian-immigrant father and son team once to do tile work on my home for me. They showed up on the job site wearing matching ankle monitors, the father for beating his daughter for prostituting herself, the son for multiple DUIs. They royally botched the job and didn't finish in the time they promised, we threw them out, and that's how I learned how to do tile.

Wow! Even the McRib program could not have prepared me for this. 

@Omar Khan   

And they stole our vodka right out of our freezer.

Those were the teeth of fate that tore into me, those were the lips of fortune that smacked over me, that was the gullet of horror through which I descended into the heaving acid of the belly of life that made me the real estate investor I am today, flaked and formed, reconstituted and transformed.

McRib is more than a program, more than a lifestyle. McRib is a creed and a manifesto, a dream whose time will come.

McRib now and forever.

(Have a heart, BP censors!)

A really unique combination of funny but painful stories in this thread. I hope the younger, newer folks are reading it cause there's a lot of value in not repeating these mistakes. And then the odd but entertaining McWib (intentionally misspelled to avoid the BP algorithm KGB) twist you gotta love it!

@Jim K. Wow, ankle monitors lol.  Thats a real good one. Hmm let me think for a moment......

thats a real good one. I don't know if i can top it. I don't think I can. 

Ok so i like to sometimes be hands on but never seem to learn my lessons .......  Most recently, a few months back ( even more embarrassing that its recent)  I was helping do garbage dumps ( saving some money ) bringing a 16 foot low boy to the dump.  I must have done 15 of them and i had gotten so pissed off on the last 3 asking why i was still doing this and i vowed to sell that trailer tomorrow.   Going in on my final weigh in, i wasn't paying attention and the trailer got snagged on the scale.  It  popped one of the tires and mangled the rim.  I unloaded all the garbage, left the trailer at the dump went to get a replacement. Got back found out the lug pattern was off. Then going to about 5 tire shops i found out the rim was a real odd lug pattern.... spent the rest of the evening calling to locate one.  I got one . A fully treaded tire and rim. What i didn't realize is that I also bent the axle of the trailer.  Being late and tired once i discovered this i made the trek home , a short 8 miles.  I made it home but the tire was bald by the time i got there.  Sold it on craigslist two days later ( yes i disclosed what happened and showed pictures of that crooked axle) and couldn't be happier . And maybe it was a simple fix with the axle but i am not mechanically inclined so hopefully the next guy got a good deal.

I let a legally blind guy help me poly doors one time. (Bad idea).

@Account Closed

All right, all right...not to be competitive, but if we're talking about recent trailers escapades...

A month and a half ago, I bought a Harbor Freight 4x8 folding utility trailer to haul trash, debris, and appliances. Harbor Freight's changing out all the tires of these trailers in all their stores, so I had to buy it online, and paid about $100 extra in shipping. So it finally shows up, and I start doing research on what I need to do to get it on the road. In Pennsylvania, as luck would have it, a trailer built out of a disassembled kit, as this Harbor Freight trailer happens to be, is considered to be a custom-made vehicle and requires a special inspection and title process. Basically, I have to assemble this trailer, get it to a special inspection site, pay a whole lotta money for the special inspection (quotes are ranging from $70-$220), haul the trailer away, get down to PennDOT and submit the inspection results and pay title and registration fees, wait 2-5 weeks for a license plate to show up, and only then is it legal to actually hook up to my car and start towing crap. And then it has to be inspected again all special-like once a year.

The trailer is still in pieces in my garage.

@Jim K.  The last line cracked me up.  Solely  based on this thread, i think i would have a great time hanging out with you.

About 5 months back had a handy man (employee) i worked with for  along time but then nothing for 1.5 years .  Used to have him have a company credit card but then stopped working full time.  So in the mean time for supplies gave him 200-300 for Petty cash for supplies as needed. 

Then he kind of went quiet , texts went unanswered.  Dropping mail off at the post office  a month later I saw him and I'm like hey man what happened. He replied,  Oh this and that this and that.  i was meaning to get back to you.  I was like you still got the rest of that petty cash?  Can you send it my way? Sure.... he replied

Petty cash still has not arrived. 

Originally posted by @Jill F. :

I let a legally blind guy help me poly doors one time. (Bad idea).

 Don't under estimate someone bc of a handicap. Might take a little extra time but they can be some of the most persistent people in the world. My wife's grand father has been legal blind sense birth. Made his living working in a wood shop making furniture. And yes he has all his fingers. 

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