Problem is though…stress + time. Managing properties is a job in its own. I don’t want a second job. I make so much at my day job missing out on a potential overtime shift because I’m playing around with rentals is going to be a net loss for me. Plus I just don’t want to be tied to this area indefinitely, if I move I’d have to hire a property manager and that eats into profits, and if I want more real estate exposure its easy enough to just put money into REITS.
Yeah…stocks could crash, so could real estate…but ultimately I’m at a point where I’m just buying and holding and really only paying attention to the dividends. As long as dividends don’t get cut, I’m not concerned about short term movements of the market. The only thing a stock I own taking a dip means to me is buying opportunity. Large, sustained dividend cuts across a variety of billion dollar companies in various industries is something I’m a lot less concerned about than the rate at which landlords tend to have to deal with vacancies, repairs, and deadbeat tenants that require evicting. If the market tanks bad enough for large, sustained, wide spread dividend cuts to take place, it means our economy just took a massive dump, and the odds of people losing jobs and missing rent is going to increase as well…so its not like rentals are always insulated from the rest of the economy.
As far as money being stressful though…I guess its just a difference of perspective. You might be concerned about losing money, but do you think your life would be less stressful if you had no money to lose and were living paycheck to paycheck, constantly one illness, one injury, or one layoff away from disaster? I guess the way I look at it now is even if I lost half my money, I’m still sitting on a nice cushion…I’d take the burden of having something to lose any day over having nothing to lose. Being stressed about losing some of your millions has just got to be obscene to even think about for some of the guys on here who spent time living in their car, or some other less than desirable living situation.
I hire a property management company for some of my properties. It’s only $80/month per property and I don’t have to deal with any bulls~~~. They deal with all the maintenance, repairs, rent collection, and eviction if it becomes necessary (thankfully I vet my tenants VERY carefully so I’ve never had to evict someone). If you choose your tenants carefully, your problems will be minimal. I really can’t think of any other way to make 14% or more on my money safely, and in the end I have a valuable asset that I can sell or continue renting out for pure profit (after paying the real estate taxes).
But yeah, if you desperately rent out your property to deadbeats it’s not going to end well for you. I’d rather have a property sit vacant than rent to stupid animals. My worst vacancy was 36 or 38 days or something. That sucked. That’s my most expensive property and honestly, not many people are looking to rent a place for $3,300/month. I might just sell the f~~~er and buy 2 or 3 less expensive properties once my tenants move. They’ve been there almost 3 years and are wonderful, but I don’t want to have to deal with trying to find a good renter for that house again. Still…I get $800/month in cashflow from that property. But if I sold it now, I’d make about $32,000 more than what I paid for it. Decisions, decisions.
The good thing is, no matter what I end up doing, I WIN! I get monthly cashflow in addition to the fact that my tenants are paying down my mortgage. Owning rental property is like getting PAID to take a free house. You would be crazy not to take that deal.
