Need Your Oppinion
Purchased two rehabbed properties no money down. Fantastic properties. Once I moved in tennants I am beginning to get a whole lot of plumbing problems. Quite costly one I might add. For someone with some cash these properties would be great. However my cash is low and I cant do the repairs the way they need to be done. Using alot of my own household money to make repairs and its killing me. What should I do. Let me hear your oppions.
Thanks!!
I am starting to understand why many guru's do not recommend newbie's buy rental properties. Rental properties are a money pit.
if the plumbing problems are on the smaller scale side (just a lot of them), then go buy a propane kit from home depot - tank, flux, solder - and get some copper piping and a pipe cutter (small instrument, a few bucks), and some epoxy. this will get you thru a lot of little holes and leaks once you learn how to apply properly. if you're the handy type, light up the torch and heat up the connections where the hole are and when you remove that section, get your cutter and cut a length of pipe to replace it and then the fun starts, soldering it back into place.
you'll feel so accomplished when you turn the water back on and find no leak in that section. then move to the next one. if you're having water pressure probs, call a professional. if you burn your house down, don't hold me responsible!
they don't sound so fantastic
welcome to thr real world of rentals, lots of maintenance, it takes time for any investment to pay off. years ago my landlord told me he figured 15 years to pay off the property and then its time for a substantial fix up which takes another 7 years to pay off. So his line of reasoning was about 22 years for the investment to make any thing
The thought of owning rentals makes my stomach churn. If I were you, I would get some quick cash by 1. selling them to a fixer upper investor if there is enought equity to do that or 2. if you want to and the renters are willing, sell them the homes with owner financing and let them worry about the leaks. Either way, I would personally get rid of them either way. I saw if you want cash flow, make a ton of cash through selling the homes and then put it in a mutual fund or something. Thats a nice cash flow that doesn't have leaky toilets 8-) TheREIman
You may just need to buy another property to either flip or hold as a rental that cash flows better. Both of these activities will help you. Funny thing that the first thing that came to mind when having a money problem is to buy more property...lol.
Anyway if you aren't comfortable with that approach you may want to consider what everyone else has already said: sell.
If the problem is with water supply rather than the waste discharge you may want to consider pulling out all of the copper and use flexible plastic hosing. This may cost you a few hundred but may be a better fix.
We need more info on what specific problems you are having.
This is precisely the reason I will not buy older homes for rentals. Like cars, older homes get to a point where you constantly have to do maintainance on sections that have reached the end of their life cycle. Ie roofs, gutters, plumbing, wiring ect. Too much hassle.
Most of my problems are the following.
-Sewer line pipes were replaced on both properties.
-A few of the pipes running from upstairs down the the basement were cracked and need to be replaced
-Hot Water heater went south and had to replace that.
-The new plumbing that the old rehabber did before he sold it to me is not sloped currectly so the water flow is horrible.
I have a good plumber who gives me good rates.....I gues I am more frustrated than anything else.
Both homes bring me good cash flow.
$350 on one and $425 on the other, tennants are quite patient and understand my situation.
I will let you know my final outcome.
Thanks for the good advice!!
If you have known structural problems with the slope and you sell the house to your tenants without disclosing that fact, you can be in for another mess when they realize what is happening. Seems like you got good cash flow but no water flow. If you are going to do the torch thing (to the plumbing, not to the house), makes sure the tenants are ot there jst in case the house does go up. Oh, make sure you are current on your fire insurance before you start!
Sounds to me like you're not in as bad of shape as you think (assuming those are net numbers and not gross). Re-post this in the landlords forum rather than the beginners forum. The advice you are getting here is from guys who are scared of exactly the kinds of problems you have. The Landlords forum has guys who actually like these kinds of problems.
Having got yourself into the property management biz now you have to learn to do it right. Go to the store and buy a couple of home maintence books about an inch and a half thick, they will have the answers to most of your problems. Plus next time you will know that sewers have to pitch 1/4 inch to the foot so you'll miss this problem.
Don't be too discouraged. Managing property is not rocket science or brain surgery. If you get even reasonably good at it there is lots of money to be made this way. The gurus tend to discourage it in favor of quick flips, etc. But how many real real estate fortunes (say 50 million and up) were made by guys doing flips? Sooner or later you gotta know how to manage the property.
Thanks "commercialking"
Thats what I needed to hear. I knew my situation wasnt that bad......I will take your advice and post this in the Landlord section.
To all you newbies.....grab that bull by the ears and wrestle him down....Sometime current problems can bring you future prosperity.....by the way those figures I gave you were after everything is paid, mortg. etc...
Thanks again everyone!!
Commercialking is absolutely right. And your cash flow is good enough to take care of these problems. You shouldn't need to dip into your personal funds. Just let your tenants know that you appreciate their patience and take care of the problems one at a time. For me, maintaining the physical properties is much more nerve racking than dealing with the tenants. But if you bought a solid property that hasn't been abused, most of your problems will be relatively simple. And if your plumber gets them done right, they won't bother you for a long time. Just make sure your tenants know that they shouldn't dispose of everything through the sink and toilet. It's sounds silly, but you'd be amazed how many people pour tubs of kitchen grease and other such things in there.
Good luck.
[addsig]
I just got one of the tennants taken care of on yesterday.....I beleive once these plumbing situations get under control I should be in the clear.
Thanks
If you think you'll be in the clear with rental property, HA!
Just when you think you've solved all the problems....
You'd better knock on wood.
I do everyday with my rental !
Sam
If you think you'll be in the clear with rental property, HA!
Just when you think you've solved all the problems....
You'd better knock on wood.
I do everyday with my rental !
Sam
don't knock too hard, there may be termites in there.
I agree....with you 100%
