All Forum Posts by: Adam Anstatt

It’s also important to not overlook the opportunity cost of early repayment. When you pull the money out of the bank to pay off the loan, all you’ve done is move your very liquid cash into less accessible equity. You no longer have control over your money. Rather than having $100k continuously compounding while you enjoy the tax benefits of your mortgage payment, you will have to start saving toward the next $100k for the next investment. And if you pay off the mortgage early and start saving the next $100k, will you remember to also save the gains that you would have made on that $100k over that same period. That’s the opportunity cost that most people cheat themselves out of. Everything is financed, whether it’s financed with a bank or financed with your future gains

Since the leases are up in a couple of weeks, I think it seems like a great time to run through the screening process.  Even if you have no intention on kicking them out, this would still be a good way to get all their information and to feel more comfortable about who you have living in the unit.  I use an application and screening service from RentPrep that I really like.  Also, taking this step could go a long way toward presenting yourself as a businesslike landlord rather than landlording as a hobby.  Hopefully that will help get your rent paid on time.  If your'e new to this, RentPrep is one of my favorite resources, the podcast is great for the commute to work.  Also, skimming The Book on Managing Rental Properties may be the one of the quickest ways to get most of the information to get you started on the right foot, specifically the chapter on managing tenants.

If you're afraid of further damage to the property, definitely take some pictures when you walk through before closing.  And be careful with the lease termination form.  The apartment falling into disrepair is one thing, but hoarding is now recognized as a mental disorder and you don't want to be accused of discrimination.  As for the late payers, you have to make it clear from the start that there is a late fee and that you will enforce it.  Right at the beginning is the only chance you'll get to potentially re-train this tenant.

Automation doesn't destroy jobs.  Every piece of automated equipment is conceptualized by marketers, developed by a myriad of designers and engineers, assembled by workers and production support staff in factories, who source components from countless companies employing their own workers and raw materials sourced by purchasing and logistics.  The automation has to be sold by salespeople and distributed and delivered by shipping companies.  Then once the automation finally makes it into the field, it must be supported by maintenance technicians and all the logistical support to coordinate their efforts.  

We focus on the loss of visible labor jobs without examining the small unseen benefit to countless people, and we end up walking into this trap of thinking that automation destroys jobs.  The trap not looking for the unseen effects would lead us to the same thinking that automated textile factories would put out of a job everyone who used to weave fabric by hand.  I doubt we have less employment in this industry than we did 200 years ago.  All automation does is multiply the our productive efforts.  

Open up the box in the store to make sure it's in good condition.  I wasted a lot of time returning chipped tubs a couple weeks ago.  I made this mistake twice on one job before I got smart.

Why don't more people find it a little bit suspicious that the employer match on a 401k seems to be the only place in life where you get money for 'free'?  These qualified retirement plans allow us to defer taxes for a few decades to increase growth, but what will happen when the taxes come due on the back end?  The highest marginal tax rates today are relatively low compared to what we have seen historically, at some points the top rates were over twice what they are today.  When you combine this with ever-increasing deficit spending and the fact that continued inflation will tend to push people into higher income tax brackets, qualified retirement plans become a bit less attractive.  A lot of people are pushing a lot of money into these plans without thinking of who will ultimately be using these funds in the future.  You may find yourself splitting this money 50/50 with the government by the time you reach retirement age.

Compare this to the inflation hedge provided by buy and hold rental properties.  While so many people are looking for returns in order to not only build wealth, but also to counteract the effects of inflation, anyone holding rental properties can simply increase rents to protect themselves.  Most people would say it's crazy not to take the company match on a 401k, but I think it's crazy to turn that money over to someone else to manage without considering whether it's really safe.  I know I'm in the minority, but I decided to forego the 401k and I have no regrets.

Though I usually find my tenants on Craigslist (and good ones), I also post to Zillow, Trulia, and HotPads.  I always thought that these were good places until an applicant told me that they had run into scammers on ZIllow trying to get them to send a check in advance and the keys would be put in the mail afterward.  They actually seemed pretty turned off to Zillow.

No matter where you advertise, good tenants come from good screening.  I've had no regrets since I started using the resource at RentPrep.