How much is a great tenant worth?
Hello BP community!
I am a buy and hold real estate investor in Colorado. I recently had an interesting situation where I would acquire a single family home with a fantastic long term tenant. The tenant is clean, keeps the house in great shape, and pays on time. Unfortunately the tenant pays well below market rates. After running the numbers (factoring in all expenses including anticipated repairs and CAPEX) the property would only cash flow $30/mo. Increasing the rent would force the tenant to leave. So unfortunately the numbers didn’t work for my personal investing strategy and I had to pass. But that begs the question: In order to guarantee a great tenant would you compromise on other aspects of your investing strategy? How much do you value peace of mind? I would love to hear the BP community’s thoughts on this.
Thanks Everyone!