Realtor · Provo, UT · Member since 2020 · 374 posts · 270 votes
The biggest mistake I see investors make when buying rentals is that they assume tenants will be okay with the quirks that the property has.
If something about a property annoys you if you lived in the unit, IT WILL ALSO BOTHER YOUR PROSPECTIVE TENANT.
Could be a bad location, shared community space to get to unit, low ceiling heights, bad lighting, not being fully rent ready, etc. These issues lead to higher DOM and lower rents.
Tenants don't overlook these issues and neither should you.
This is 100% accurate, and it’s one of those truths that sounds obvious but gets ignored in underwriting.
Tenants don’t “get used to” friction. They tolerate it until they don’t, and then it shows up as longer vacancy, rent concessions, or turnover. Things like awkward access, poor light, low ceilings, parking pain, or shared spaces aren’t minor quirks. They’re demand killers.
I’d add one nuance: rent doesn’t fix livability problems, it just discounts them. You can still rent a property people wouldn’t want to live in, but you’ll pay for it every cycle through lower rent, higher churn, or more management effort.
Would a normal, stable tenant feel proud giving someone their address?
Would they still like the place six months in, not just on move-in day?
If the answer is no, the deal needs to be exceptional to justify the headache. Otherwise, you’re buying a vacancy problem in slow motion.
This is 100% accurate, and it’s one of those truths that sounds obvious but gets ignored in underwriting.
Tenants don’t “get used to” friction. They tolerate it until they don’t, and then it shows up as longer vacancy, rent concessions, or turnover. Things like awkward access, poor light, low ceilings, parking pain, or shared spaces aren’t minor quirks. They’re demand killers.
I’d add one nuance: rent doesn’t fix livability problems, it just discounts them. You can still rent a property people wouldn’t want to live in, but you’ll pay for it every cycle through lower rent, higher churn, or more management effort.
Would a normal, stable tenant feel proud giving someone their address?
Would they still like the place six months in, not just on move-in day?
If the answer is no, the deal needs to be exceptional to justify the headache. Otherwise, you’re buying a vacancy problem in slow motion.
We have made offers on properties then stopped the inspection halfway through because the floorplans are so unworkable. If I can't visualize how I'd use the space, propsective applicants will feel the same.