Home moanership

I'm reading stuff here that has me a little concerned!

Hubby and I kick around the idea of investing in a property as rental income, since we can expect no pension of any sort. His place of employment provides zero pension.

We talk about building a place and renting it out. But I have had people shriek at me, good Gordon, do NOT build new to rent out!

I have thought about buying crap mobile homes to rent out for $600 a month, but with $350 of that going to the mobile home park, plus taxes and insurance, it's a pretty small return on investment, since 1970 mobiles run around $50,000 in these parts. (average, some higher, some lower) But the pad rent just keeps goig up. If it costs me $450 a month to make $150 a month, is it worth it?

Every now and then you hear about a good renter. Our neighbour is a renter as she is worth her weight in gold! I would LOVE to have someone like her for a renter. BUt I'm getting the feeling she is the exception to the rule.

In a perfect world, where the laws of reality do not apply..I would have a place that I rent out for short times to out of town snowmobilers. I would charge them an exhorbitant fee, I would provide dinners and lunches and they would have (this is important) secure parking for their trucks and sleds. You would be amazed at the number of monster, Alberta trucks loaded with big, schmanky sleds that go missing out of hotel parking lots!

So, can our retirement years be augmented by rental income? Or is this more hassle than it's worth? Then there's the whole, gee, do we at this stage of our life (49 and 50) want to take on another 25 year mortgage? Groan.

WHy can't HUbby work somewhere with a pension plan?

If you build it, they will come! I think it is a great idea.

In terms of an investment, is there a storage facility in your area? Hubby and I kicked around the idea here and before we knew it, someone else built it and are making a killing on it. We do have a rental property in the city as an investment. It has been good for us. We actually do not make any money on a month-to-month basis, and may even loose some on a month where we have to replace an appliance or do repairs, but it is an investment. When we sell it, someone else will have paid the mortgage. We are 2 hours away, and we rarely hear from someone, unless there is a problem. The lady upstairs pays by cheque and the couple downstairs prefer e-transfer. It is sometimes a pain when we have a toilet back up in the middle of harvest, but that is the drawback of owning an older property. I think new would be easier as you would have less maintenance than buying an older one.

My dream - an Ikea apartment. Small, functional and modern apartments, located just far enough from the University that it would not attract the partying first years, but close enough to attract grad students and visiting profs etc.

Renters like her, and us for that matter, are few and far between.

You have to find someone who's first priority, above everything is a roof over their head. Before food, before clothes, before heat, someone who pays to have a roof first.

Moose and I have often said, if we have nothing but a house to live in, we can make it.

My family was involved in renting apartments. Used to also work in Jasper renting apartments and hotels/motels. For every one good renter you have, you will get many who you may have trouble with. Then there are the nightmare renters. Those are the ones that will frag your rental property completely to hell and then will skip in the middle of the night leaving you with what's left, if anything. Nightmare stories, oh my do I have some.

We've thought about trying rental properties but you hear so many horror stories that I doubt we ever will. My Aunt and Uncle tried renting out his mother's house and the placed got trashed first renter out.

I also have a relative who managed a rental property in Toronto years ago. One tenant started complaining about mold. She checked the apartment above and they had brought in soil, bucket by bucket, until they had turned one bedroom into a garden (plants growing right on the floor). She made them haul it out bucket by bucket but those two units still needed extensive work.

uno wrote:
In a perfect world, where the laws of reality do not apply..I would have a place that I rent out for short times to out of town snowmobilers. I would charge them an exhorbitant fee, I would provide dinners and lunches and they would have (this is important) secure parking for their trucks and sleds. You would be amazed at the number of monster, Alberta trucks loaded with big, schmanky sleds that go missing out of hotel parking lots!

I think this would be a better idea than renting a place out long-term. A B&B geared to Alberta snowmobilers could do very well - provided there's enough snow every year, of course. Sign up with a credit card processing merchant and get credit card numbers and damage deposits ....

My husband is one of those monster Alberta truck & trailers with swanky sleds - I would send him to you! So many guys from out my way make frequent trips to B.C. for the snowmobiling, spend a bunch of our Alberta oil money, come home, work some more, and then do it all again. I know guys who go once a month all season long ...

Fowler wrote:We've thought about trying rental properties but you hear so many horror stories that I doubt we ever will. My Aunt and Uncle tried renting out his mother's house and the placed got trashed first renter out.

I also have a relative who managed a rental property in Toronto years ago. One tenant started complaining about mold. She checked the apartment above and they had brought in soil, bucket by bucket, until they had turned one bedroom into a garden (plants growing right on the floor). She made them haul it out bucket by bucket but those two units still needed extensive work.

Toronto is were I used to clean apartments. It was the first job I had as my Dad worked in property management. He was able to get me in on the summer program for students. The horror stories I could tell. Worse offenders were students. Some of those young adults would literally trash their apartments as a "send off" when they would complete their semester.

Authentic, this is an idea I've kicked around...BB catering to sledheads.

We live near Hunter's Range, challenging sledding and always a lot of snow way up there. Often they sled until June depending on road condition and whether or not logging trucks will mow you down as you make your way up. HUbby and his buds are heading out tomorrow. Silly sport if you ask me, but no one does.

It would seem that most people who rent who have had problems didn't do there home work first ? Not that you can catch all the unruley tenants but you can sure drop the averages .I would NEVER have a rental anywhere that a school student could rent it ! Not saying that they are all bad ,just not a good choice .We have pondered having some rental property as well and I can tell you that there would be monthly inspections if needed ! We rented a house from a couple when we got married and it was located in the country and we did it all ,mowed the lawn ,fixed the little fix's etc .When we moved out we asked if they had another renter and they said no ,they wouldn't rent it out again ,they had a few other rentals and as some have said here .........bad tenants ! so after we moved out they refused to rent it out again ............said we were the best they had ever had ! I guess what I was taught about respect as a child paid off ?

uno wrote:Authentic, this is an idea I've kicked around...BB catering to sledheads.

We live near Hunter's Range, challenging sledding and always a lot of snow way up there. Often they sled until June depending on road condition and whether or not logging trucks will mow you down as you make your way up. HUbby and his buds are heading out tomorrow. Silly sport if you ask me, but no one does.

Sledheads have money as you know because your husband is a SledHead. so going where the money is a smart thing. B&B is not owner ship in a rental property so once again you are ahead of the game. If you don't minding me asking, how many acres do you have? I have worked in Enderbush and have family that has lived there for years.... Are you and your husband a long time resident, if you don't mind asking? Hummm and i'm not writing a book if you would like too know...
Kimball

This article seemed timely;

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I think a modular would be a better idea than building,or a trailer. There's some really nice ones. We have a company not far from here that makes modular log homes. Once theure put together you'd never know any different.

First, Pensions are not free. You would not believe the amount that is taken out of my paycheck each month. The vast majority of people in my career die before they take out as much money as they put in. Only the old farts who live decades past retirement take out more than they put in. They say that the average person in my career dies only a few years after they retire. I am forced to retire this summer because of my age.

Second, Is the return worth it? I would say that a 25% return on an investment is a good return.

third, I used to be in real estate and a landlord . The real estate investment was the best investment that I have ever invested in as opposed to investing close to a half a million in Nortel stock which I am still paying for of which is now worth a total of $8.00, not per share I mean in total. In the long term real estate always goes up.

fourth, I found when I was doing my research in investment real estate that the kind of property that had the greatest positive cash flow and one of the lowest purchase prices was half duplex's with suites down below. I had two of them and one tenant for 12 years and eventually he moved out and was 2 months behind which I was not able to recoup. You have to be a certain kind of person to be able to deal with all of the headaches. The landlord and tenant laws in Alberta are very one sided in favor of the tenant. There needs to be some kind of registry for landlords to put dead beat tenants on so other prospective landlords don't also get screwed by them. This is what is always happening. The bad tenant goes from place to place getting a few months rent free and it is hard to get anything from them in court because they are always on the move and they usually work under the table for cash so you can't go after their paycheck. I would't be a landlord again.

Fifth, If you read the very short novel called "The Wealthy Barber" which is a financial advise book made in the form of a novel to keep it interesting, you will find that they suggest to invest in either mutual funds or real estate but they also state that in the twilight of your life is the time not to invest in either of those investments but to start drawing out of them of outright selling them and living from the proceeds. I don't know what to suggest maybe storing RV's on your property which you already have as long as you are not to far from a major center. Good luck

pss, I no longer have my rental properties because I sold them when the stock market was crashing so that I could buy more stock at a drastically cheaper price so as to bring down the average cost per share in my Nortel investment and that was before the CEO's were charged for fraud and I lost all of that as well. No sour grapes here, life is great and I really mean it. Lesson learned " Dan Smith should never get involved in any stock investments"