Hands On Real Estate Investing

We have been fortunate to have the same family reside in our rental townhouse for 23 years! When they applied to rent the townhouse from us 23 years ago, they were having some credit problems so we requested that they provide 12 post-dated check every year. It worked out very well. They didn’t ask for much, and in turn, we didn’t raise the rent very much. If we did raise the rent, it was only $25 or $50 extra per month. After about 20 years, we realized they were paying way below market rent. Market rent for the 3 bedroom townhouse was $1,800 and they were only paying $1,200 per month. We decided to start charging higher rent increases every year. For the first couple of years, we went up $75 per month. For the third year, we went up $100 per month. The husband advised us that the wife was on Social Security disability. For the husband, technology made his advertising sales career obsolete. We were sympathetic, but real estate investing and property management are businesses. The purpose of a business is to make a profit, so we were comfortable with our decision to steadily increase the rent toward full market value. Once the tenants were paying $1,600 rent per month, they decided to move. We had the townhouse cleaned, painted, and replaced the wall-to-wall carpeting and vinyl floors. As soon as we put the property up for rent at full market value, a prospective tenant with a Section 8 housing voucher applied. We met our goal of getting full market rent for the property, but there was a price to pay for the $1,995 rent … Click here for details

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Preparing a 3 Bedroom Townhouse for Sale … 27 years ago we bought a 3 bedroom 3 bathroom townhouse for $90k It was a #fixerupper with a #motivatedseller so we believe we got a good deal! Painted, added new #flooring in the bathrooms & kitchen, cleaned the carpets & put it up for #rent The first #tenant paid rent on time, stayed for 18 months, then moved. Left a hole in the wall, but other than that he was decent. Our next #tenants were a family with 2 kids. They had #creditproblems so every year we asked for 12 post-dated checks up front & it worked out great. They stayed for 23 years, raised their kids & sent them off to college. Because they were great tenants & didn’t ask for much, we didn’t raise the #rents very much. After so much time they were paying way below market value … #realestate #realestateinvesting #realestateinvestor #realestateinvestors #investmentproperty

A post shared by handsonrealestateinvesting (@handsonrealestateinvesting) on May 29, 2020 at 6:22pm PDT

After a 6 month ordeal with our new tenants, we decided to sell. Fortunately, we didn’t have to spend much money on the property for the entire 27 years. A new furnace in 2001, a new water heater in 2017, a new retaining wall … No new roof, no new appliances. Since we hadn’t made any upgrades over the years, the kitchen and bathroom fixtures were dated. We cleaned the property from top to bottom, did some touch-up painting, repaired the bathtub drain pipe, and put the house on the market during Coronavirus COVID-19 for $240k. If we had upgraded the kitchen and bathrooms, the house would be worth $270k, but we made a decision to stay on the low end. Our decision paid off! By the time the house was on the market for 3 days, we received 5 offers! The offer we chose agreed to accept the house in AS-IS condition.

Have you had a long-term tenant in your rental property? If so, please share how you kept them for so long:

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