All Forum Posts by: Thomas S.

Being M2M I would give them notice to non renew and be rid of them. If you decide to keep them have them sign a new M2M lease with rent at full market.

Funny this is the type of situation that I can really get my teeth into as a self managing landlord. With good tenants there is very little for me to do, these situations add some fun to my job since I enjoy messing with people. It's a challenge and I enjoy challenges. 

There is a British TV show "can't pay we'll take it away" (on the internet) high court enforcers that do collections and evictions. That is the type of work I enjoy.

Investing in real estate is far from passive, you are not going to escape have to put in many long hours although the work is obviously far less physical than farming it can be high stress. Do not think of real estate investing as being passive, it is not and it is definatly not for everyone. If you want passive you will need to invest in a REIT, income fund or something similar. You should be able to average about 10% long term.

I would suggest if you do not have a financial advisor you should get one and have them advise you on where the best place is to put your money based on your present lifestyle and future plans.  

@Jeff Lucas "I took a hard line with my tenant"

That's not a hard line it's a business line....congratulations.

Almost any other investment will out strip a mortgage interest rate today. Putting you money in a managed moderately conservative income fund would easily return 10% (double mortgage interest savings) long term. You do not want to bury your money in real estate and be stuck with a measly 4-5% return based only on saving a interest payment. That is not investing it is hoarding money.

Due to the opportunity value of cash the best/highest return will be made by spreading it around and maximising leverage. Leverage will increase your real cash flow where as using cash will reduce your returns on that cash due to lost opportunity value.

If you want to maximise income you must use leverage not cash to generate it. Do the math comparing buying one property with all cash to buying 3-4 properties using maximum leverage, the numbers do not lie, leverage will come out ahead cash flow wise every time.

Also if you are a conservative investor high risk real estate investing may not be for you. A couple of bad tenants will wipe out your cash flow since rentals are a very slow long term investment and the fix and flip market is about to take a turn. The market has reached a peak and flippers are begining to pull back.

@Dan W.

Try searching under RVs and campers for used ones for sale.

To save yourself a great deal of time and effort the first thing you should be doing is speaking with the local building inspectors for each county/district you are considering buying land. No point is wasting time speaking to people across the country as it will be county specific when it comes to building codes.

Also do not waste time trying to fight the system, if a building inspector will not allow a tiny home it is because it is not to their building codes so no way you will change their minds. Square footage plumbing, electrical, stairs all need to conform with local codes and tiny homes fall primarily under the category of a RV since they do not meet conventional codes.

How is bribing a tenant a better option than the legal approach of simply non renewing a lease. That advice comes from landlords that are not prepared to properly manage their business. Their priority is to avoid managing as opposed to actually managing their business. Their approach is to throw money at every potential problem and hope it goes away. This is not management through logical business decisions.

Non renew your tenant, as legally permitted, and move forward with your business.

I do all my own plumbing so can not comment on pricing. I have not used copper for at least 6 years at this point in time. Would not use anything but Pex and in your case would hold off replacing the plumbing for now if there is any possibility of codes changing in the next few years to allow PEX. 

No way I would be installing copper at this point in time.

Work with her, list it for rent and let her go when you find a new tenant. What you want to do is advertise for a vacancy 2 months down the road to allow her time to arrange to move AFTER you find a replacement tenant. You deduct all your cost of finding a tenant from her deposit. This is the normal turnover process for experienced landlords. Very seldom have to experience a vacancy when you plan ahead and have good quality tenants.

If she wants out make her work and pay for it.

3 year lease, undermarked rent, owner turned tenant. The investment is not crazy just stupid. It's a guaranteed loser no matter how you frame it. Walk away.

Even at full rent ($1200) it is too low for a property worth $150K. It does not matter what you pay the important factor is what it is worth. The value of a property has a direct relationship to cost of repairs and cap expences.