Just curious, do any of you rent a house to tenants? When my kids were in school (college and Tech school), I decided to buy a rental property for them to live in. It’s worked out great as it’s helped my kids (yes, they pay rent, for a reduced price) and Utah housing has appreciated in recent years.

Now, in one month, my son just bought a Condo, my other son moved to a rural apartment, my third son took a job in West Texas. This all happened in the last month!

Without getting into the whole tax issues of selling it, I have decided to rent it out. As a disclosure, I have heard a lot of horror stories with renters.

I’d appreciate any advice on renting out a house. And no, I will not be allowing pets (I enjoy my dogs but do not want anyone else’s dogs or cats )

When I moved to Seattle in 2006 I rented my house in Idaho. Idaho (-at the time) was VERY landlord friendly. The people decided to stop paying, and had done some damage to the house. I talked to everyone I could to influence him - from his Bishop (he was Mormon), to his work. Eventually I served him with a 3-day right to cure, he didn’t. So I had the sheriff escort him off his property with all his shit in tow.

Then I sued him in small claims court and won so easily I thought I missed my calling as a lawyer. He was ordered to pay me monthly, then he stopped doing that after two months. So I went back and garnished his wages. I eventually got every penny.

And learned the lesson I don’t have enough spare money, patience, or time to deal with renting a house.

I have two friends in Seattle now who have tenants they cannot get rid of after stopping paying rent due to the eviction moratoriums there. They are losing money hand over fist.


Then again, I also know a guy in Seattle who owns about 100 properties. I think at that level the little bullshit becomes tolerable as it is offset a great deal.

I have friends with rental properties + I have heard stories, Pro + Con. Mostly Con. I wouldn't do it myself just because I don't want the additional potential headaches. 2 stores here from folks that I know that had rental property when the tenants didn't pay. The 1st was this huge fat woman whose AC went out + wanted Jim to fix it even though she hadn't paid the rent. I told Jim, don't fix it; you don't have to + I guarantee she'll be out in a few days in a hot Texas summer.

She was too! The 2nd was a preacher who didn't pay the rent + wouldn't mow the grass. So the property owner who was also a bee keeper placed numerous hives all over the yard. Yeah, the preacher moved. When my mom + stepfather retired many years ago they bought a rental thinking it would be additional income. The folks trashed the place, wouldn't pay rent so eventually they just sold it back to the realtor = let him deal with it. In Texas it's almost impossible to evict someone regardless.

I would agree with most because times are different. After I stepped down as president of SAE at TCU I moved into a house owned by parents of my grand little brother.

His parents bought it as an investment property, yet as tenants, we made it better. Any improvements were run by the owner, but we didn’t seek compensation or rent relief. We were just bored rednecks and wanting to make things better. I left that place better even after the fun we had.

These days are different. Airbnb places get trashed over a weekend.

IF you play that game.

Take pictures of every INCH inside and out.

Sooner or later you'll need them to compare to

the damage in court when you sue the renters.

My folks rented out our home place and grandparents place about 9 years while they lived in a rented farm house themselve's.

They fought a few battles. I don't know if they
had problems collecting the rent. One was rented thru the state/county welfare with guaranteed rent payments and damage repairs. The biggest damage I know of was their kid put a rock thru a big picture window. That had to be fixed then. Collecting for it took a couple months.


Garnishment depends on their source of income.
IF all they have is SosSec, VA, or some other government income and no other. You're SOL. IF
you do pull it out of their bank account you WILL pay it back, if it causes bounced checks. YOU WILL pay those charges back too!

KNOW where their income derives from first.

George

I have owned multiple residential properties for about twenty-five years. My main gripe is HOAs. Many hate non-resident owners and will discriminate against you, cause problems renting, hassle your tenants. Living overseas I never managed my properties. I am happy to pay 10% to allow someone else the headache of handling the tenants complaints.

During the pandemic I have kept full occupancy, and no one has missed a rent payment.

I have had to file eviction numerous times in twenty-five years, and that is usually enough to get their attention.

Do not believe any promise you ever receive from a tenant, although occasionally you will be surprised by the decency of people. I let one tenant fall behind a few months due to illness in his family. I did finally have to not-renew their lease. I kissed the money good-bye. He promised he would pay me back $100 per month after he left. He did just that. It took a few years.

Another new tenant was a grandmother and grandfather raising their three young granddaughters. "They" moved in. The management company never got the man's name on the lease. The grandfather ran off with his secretary and left his wife with no way to pay the rent. I let her stay rent-free a few months. She made tons of promises. I had to boost her out. She promised to pay me back. I've waited fifteen years. Haven't seen anything yet.

The main thing I gain by renting is the appreciation in the value of the property, and it has been significant. If I can cover the mortgage, taxes, and insurance on top of that I'm fine. You can't actually do that anymore, but I also don't have any mortgages anymore.

I consider rental income about 1/3 of my retirement three-legged stool.

Our son had a condo in St Paul Mn. The city recently imposed rental restrictions. Not sure of the specifics, but they sure did not favor the owner of rentals. He sold the condo. The renters had the place in a mess so he kept the security deposit but it did not cover the necessary repairs and cleaning. he did make great money on the sale, due to the real estate market being on fire.

We do rent quite a lot of properties, both residential and commercial.

But we are very lucky we have very good rental laws.

They protect both the renter and the landlord.

Current rental agreements are required for water and electricity connections.

You fall behind on rent, you do not get an update agreement and you have no utilities.

I hear a lot of horror stories concerning tenants. I have been a renter in life and am sorry to see that things are not the same as those days. I think it depends on your state too. Tenants, the shitbird type, seem to have a lot of protection.

I've also had low income friends who were renters that could not get the landowner to repair/mitigate Stachybotrys mold issues. Rentals seem very limited out where I live and they had a hard time finding another place to live.

I think problems can occur depending on the country and laws.

We value our properties and look after them.

We have a 24 hour maintenance number and crews standing by.

A lot of competition if we did not look after our tenants.

We get quite a few tenants writing to tell us how much they appreciate this.

I have 3 rental properties. Only one was bought to be a rental.

I don’t rent for income or return on capital - I rent primarily as a offset to hoa, property taxes and someone to live and maintain the place.

I use a agent. Although in 2 local properties I deal directly with tenants. So the agent is just a 10 percent cost.

I charge much below market so the tenants I have stay with me. I like them and they pay the rent on time. They also know they are getting a damn good deal. I have not raised my rent in last 4 years.

So I have made little money off my tenants but my underlying properties have appreciated significantly. Same time I get little headache of maintaining my property - houses well used are much better off than locked houses.

There are no free lunches. If you want to makes real rental income you will have to move down the ladder of income and property maintenance. I prefer the property appreciation game and owning properties I like.

Mike

Wow, great responses and I am very glad I started this thread.

Between the time I posted, and the time I am replying to this, it looks as if I may have found a good renter. I am going to give them a very good deal as it will help me (great tenants who will take care of it) and it will help them as they need the space and it will be a much better situation than their current apartment.

They are friends of ours (I know that this can be dangerous). However, the husband used to work for me and he is top notch and pays his bills. I will do a lease agreement.

I am certainly not trying to make money off month to month rent as that is difficult to do in our economy. What I am doing is trying to preserve the house and hope that it continues to appreciate.

Thank you for the great advice!

I started my career in credit when I was 17 as a young naive mortgage collector with zero responsibility. Well it didn't take long at all for me to realize that people in financial trouble will lie their asses off to get by, even if its just for a day.
As a result, I became very hardened.. Even so, I would fall for a good story every now and then.. probably only 1 in 10 was legit.

Fast forward to about 1980 and I had a neighbor from hell. Renter. It took the landlord 8 months to get them out and the place was essentially trashed.. I've heard other horror stories from a friend at work.

I think it all depends on where you live.. Pa and DE are NOT landlord friendly states.. NJ is a little better, but not much.

If it were me, if the property was not in a landlord friendly state, I would say save yourself a boatload of aggravation and Bail.

quote:

I will do a lease agreement.

Something to consider. During the pandemic I started moving from "one-year" leases, to "month-to-month". The reason being that if a tenant had a relatively long term lease and lost his job, or just decided not to pay I might have trouble and expense getting him out* until the term of the lease expired. With him paying "month-to-month", I could just not "extend" and he would have no recourse in my view.

* On August 3, 2021 there was a CDC order halting evictions due to non-payment of rent. The Supreme Court struck the order down on August 26, 2021. I didn't like the idea of something similar being accepted. I wanted to limit the possibility of getting trapped with a non-paying tenant, so I backed away from extended term leases.

Good point Ken

I had two, down to one now.
Being a workaholic I bought a fix-er-upper to work on after work.... I like building, and can do anything from electrical to cabinets.
I rented it for years, and just sold it in Jan.
The other I built new on land I got at a tax sale. I had wanted to build a little post and beam. sawed out the lumber and had a good time building it. I started out renting to someone I knew. When they left, they recommended the next renter. That is the way it has gone. I give them a good deal, no lease, they stay until it's time to move on, and they find the next renter. They have always been so happy with how they were treated, they only wanted someone who would appreciated it in there next.
Maybe not the norm, but never had a bad renter, been stuck with any bill. Always really liked the people who were living there.
The couple in there now take care of everything, either themselves or one of their friends. They only call when they want me to come over for supper.

Those are the kind of stories one wants to hear; it's sad that they are so few.

I rent property now and have for 16 years. My biggest recommendation is to have an attorney draw up a lockout clause. That is, for failure to pay rent within 30 days or violation of occupancy restrictions, the property will have the locks changed and renter is locked out until payment is received. I resorted to this because of a nightmare scenario.

Back in 2017 I was renting a house to a nice lady and her female companion. While I was away on a two-month business trip, she invited a couple with a baby to live with her. This was against the lease, but she did not inform me. The male guest turned out to be a drug dealer/crack head who had befriended her and got her hooked-on heroin for her back pain. When I returned, I discovered this and tried to get the couple and baby evicted. Couldn't do it according to the law. The tenant had to sign the papers to evict, not me! I consulted a magistrate and he told me to evict her, and the druggy would have to go with her. Well that took 2 months. In the interim, that bastard sold all of the appliances and furnishings included with the rental, plus repair materials stored on-site. He also stole her $900 K retirement fund. Left her homeless. Damages and theft to the home exceeded $9k. Insurance only covered $4K. Little shit finally got caught stealing and sent to state prison. I prayed every night he was someone's little bitch.

No kidding; he was his cel-mate, now he's his soul-mate. Sorry, I know your situation is not funny. It seems more + more that the law is more in favor of the criminals than the victims.

quote:

Originally posted by NormanConquest:
No kidding; he was his cel-mate, now he's his soul-mate. Sorry, I know your situation is not funny. It seems more + more that the law is more in favor of the criminals than the victims.

Criminals are the new victims. It’s the leftist way…

Exactly! Just beating a dead horse here but bringing it up again. Last year my Jeep Wrangler was stolen from my property, wrecked a week later in another town; insurance wouldn't pay anything + all they charged the criminal with was unauthorized use of a vehicle so he walked + I was out 10K + the 2 other cars that he hit + totaled got nothing either because the car was stolen. Our "law writers" need to wake up + smell the coffee!

I'm sure you know, but do a credit report. If they are just moving in to take advantage and have done it many times, it'll likely show there.

Thanks again for all the advice.

Like I mentioned, I know the young couple and better people would
be hard to find. I’ll discount the rent and will still do a contract.

CYA for sure. I wish you luck; it's not all doom + gloom, I have a few friends with rental properties that have done O.K.

Kinda along the same lines, I had some advice from an elderly guy I worked with years ago (WW2 vet so that dates it) + he said when you go into business for yourself + need a helper find a young guy with a new family. He HAS to do a good job because his new family is depending on him. Good advice, Dick at the time but I'm not so sure that today's youth hold that same moral code of ethics; + that's really sad.

quote:

I'm not so sure that today's youth hold that same moral code of ethics

There are many who do not, but many who do, with this young man being one of them. I work with a lot of the younger generation and there are a lot of issues (I’m sure people said that about my generation). However, I do see a lot of hard work people in their twenties.

Oh, I do too. I don't want to paint an entire generation with the same brush, but must admit that I see a lot more slugs than I ever did in my generation. I KNOW! "The kids these days wear their hair funny + their music's a bunch of noise."

I think one only has to pay attention and look at how much of the population is on welfare to know there is a big difference between today and a generation or two ago. As a youth there was no 'free' school lunch or breakfast. Parents fed their kids. We 'regular' kids took a sack lunch and a nickle for a carton of milk to school. Very few actually got 'hot lunch', those were the rich kids.

We were raised to get jobs and be out of the house by the end of high school. I wanted college so I had to pay my own way and did. Many kids went to trade schools, some did have wealthy parents who bought their cars and paid for college. Not a lot of them were actually successful people though. I did not understand that for a long time but I believe it is because they did not have to struggle like some of us did.

Now the taxpayers feed everyone's kids two to three meals a day at schools. No one needs to be responsible anymore. That is why there is so much poverty. Many of my well to do friends have adult offspring (and grandchildren) still living at home. These are vastly different times for sure.

I do have some young friends with families who do work very hard raising their kids. They are farmers though and also hold outside jobs much like people did when I was younger. There are not many who work like that anymore. It is easier to sit on the couch and be poor.

quote:

Many of my well to do friends have adult offspring (and grandchildren) still living at home

When I hear stories like the above I wonder: Who is dumber, the parents or the Offspring?

I had a rental in the past and would not do it again. Most people do not take care or have respect for property they are renting and they can be hard to evict while you are paying a mortgage, getting eviction notices sent and the tenants are destroying your home.
I only had one bad tennant but they did a number. This was in North Idaho.

Just fer schitz n' giggles.

I do very few evictions as I've adopted a strategy the works very well for me.......

Once a tenant is two months behind on their rent, I meet with them FTF and make this offer.

I tell them that it will cost me at least $115 to file a forcible eviction and detainer suit.

When i prevail (As Texas is a landlord friendly state) it will cost me another $115 to get a writ of possession.

After I obtain that writ, they will have three days to move or the Constable will come in and move all their possessions to the curb.

I then ask them, "what if I will give you $300 (up to $500, depending on the circumstances) to help you move out. Under those circumstances, how soon could you be moved out.

Most times they are out within a week and many times they clean up the place before they leave. They are not mad, it's not personal, and they don't trash the place. That way I do not lose 2-3 months more rent.

Ya know what Yogi' Bear sez' to Booboo.

Ya gotta be smarter than the average bear.

ya!

GWB

A useless story but sort of humourous.
A friend of mine's father in law passed on and the eldest son lobbied for a school chum to rent the farm house. The school chum used it to live in and cook methamphetamine, turning it into a toxic waste site.
The eldest son who got his chum into the house was a DEA (drug enforcement agency) agent.

When I moved to Logan, I had a rental in Riverside that was rented for about the same money as the interest on the loan. A lot like a savings account in that regard. One time the tenant (single mom) asked if she could paint the bedrooms in lieu of a month's rent. OK, found out later she'd painted one room orange and another black. And she kept chickens. When it came time to sell the place, my real estate lady said she'd been run out of the yard by a rooster. I had to cover the phone for a minute while I digested this scene in my mind's eye. After commissions, I got out with just my down payment, which was good enough as I needed that for the house we bought in Smithfield.

I hear these horror stories and it makes me pause a bit. My "good" potential renter is still on the fence about renting it in that he plans to build in a year and could save a bit by renting a smaller apartment (I cannot say I blame him).

I will have potential renters fill out an application, I will check references and see how it goes. I certainly know that there are no guarantees and I will just have to roll the dice, to a degree.

788, along those same lines of off + on the story; my son went to MetalMart yesterday to pick up some colored metal for flashing + when he got back told me that everyone working in that store was a meth head. Unbelievable.

quote:

Originally posted by NormanConquest:
788, along those same lines of off + on the story; my son went to MetalMart yesterday to pick up some colored metal for flashing + when he got back told me that everyone working in that store was a meth head. Unbelievable.

Yep, It's an easy drug to get started on, but a tough one to get off of.

I was talking with a friend who is a route delivery driver for a AC supply house here + he said that when he's in Kingsland, Tx. he won't even get out of his truck. He says that the whole town is a bunch of drugged-out walking zombies.

Do it if you like drama and enjoy seeing your property destroyed by a bunch of low life idiots. I consider it a 3rd job. It can take up that much time.

I like the good old days went you called Vinny and the tenants were out the next day.

Was worth the price.