What series of events can blow through 6 mo worth of reserves?

Question

Not counting COVID of course.

Does anyone have a story of cutting it close? I've been fairly lucky myself. My expenses and vacancies are spread throughout the years.

I don't want to get cocky though.

Thanks!

Account Closed · Answer

I'm Shocked! Shocked I say, that you can be that close to Seattle and be a clear thinker. ;-) Keep it up.

John Underwood · Answer

Depends on if you have reserves for one house or 20.

If for 20 an issue with one house is not going to wipe you out because you have 19 other properties with no issues.

Got to have insurance.

Bjorn Ahlblad · Answer

Underinsured natural disaster named above, hyperinflation; we are already seeing out of control price hikes, speaking of out of control; how about out of control politicians. Doesn't have to be Covid related. 'Cancel rent' and 'housing is a human right' were both discussed pre-covid. So how about 'no rent Thursday' as a fun holiday?

Jason Hirko · Answer

@Alex Silang Hurricane Harvey. Underinsured and wiped out 24 months of reserves!

John Barrett · Answer

@Alex Silang just about anything requiring you to get a permit these days could take 3 to 6 months or longer depending on the scope of work and number of departments that need to review and sign off on the plans. This doesn't even take into account the wait time if you need an architect to produce plans.  Most cities cut staff in their permit offices and the backlog of work to get done is taking an inordinate amount of time for the small number of staff remaining.

John

Lynnette E. · Answer

My parents a long time ago had one of those situations.  The renter's husband unscrewed the water from the washer to connect the garden hose to the water connection and ran the hose outside to wash his car while the other water hose was in use, forgot what, maybe kids playing in the sprinklers.  Anyway, he finished and turned the water off at the washer connection and did not screw the washer hose back in.  Wife renter then went to  wash clothes and the water did not come on to fill the washer.  So she remembered husband used the connection and turned the water on and heard it running and walked away. The washer hose was NOT screwed on though.   They left, went to grandma's, stayed out late.  Returned home and all went to bed.  The next day they woke up and water was throughout the kitchen, dining room and living room and the enclosed patio.  The washer connection on the wall was still running water onto the floor.

They lied to my parents.  Said there was a water leak in the slab somewhere.  Neighbors told my parents what really happened as they were trying to find a water line leak, but the water meter was not spinning when the water was off.  Renters had already left for the weekend at my parent's expense.

Flooring, drywall, insulation, paint, cabinets--full of food that was soaked and a mess!  The insurance declined the claim saying it was not covered.  It definitely cost my parents more than a years worth of rent to fix, and us kids did a lot of the work.  We took our time so we could justify why the renters needed to move on--more than 30 days to fix--even then they wanted my parents for pay for their wet stuff.  Nope.  They already felt bad that they paid for the weekend when it was the renter's fault, not the plumbing.

What series of events can blow through 6 mo worth of reserves?

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