Corporate Landlord Takes Over Duplex Doubles rent, refuses checks

[freebeard]

Originally Posted by redpoint5

Not a true dome, but I wonder what portion of the benefits it retains?

Actually it is. Typical Oregon Dome design on a 1 1/2 story riser wall. The first kit out of Oregon Dome's factory was a 35 foot dome in the South Hills of Eugene, perched on the roof of an L-shaped box, making it more of an addition.

It has the benefit of a clear span roof, but they cut the interior up with a zoned plan (hallways)

The sloped eyebrow canopy over the half-hexes was an Oregon Dome innovation. I laid out the dimensions and they were cut from 1 1/8th" plywood.

If you go into the Bayshore subdivision North of Waldport and take the upper loop, you might see the 39 foot dome my parents built in 1980:



It was pretty overgrown with foliage last I saw.

[samwichse]

Yeah, man. You need to move.

[JSH]

Originally Posted by rmay635703

My new corporate overlord doubled my rent and requires I have an online account with them , it of coarse also has fees associated with it alongside paying my landlords liability insurance.

my identity has been stolen since I was 16 and anytime I make an online payment I almost instantly am compromised again getting fraudulent charges or access attempts to my account(s)

Given Wisconsin sucks is there some way to force other payment methods?

I am disappointed I allowed this to occur, I am very picky about my landlord but sadly half the town is under corporate ownership

Doubling the rent is a common tactic to get you to move out so the owner can renovate the property and move it upmarket

No, you don't have recourse on the online payments. You can sign the new lease, or not.

Originally Posted by redpoint5

16% eviction rate. Seems about right to me. My WAG is that 20% of renters are such dirtbags that nobody should rent to them. By dirtbag I mean they either don't pay on time, or cause excessive damage, or create other livability issues such as being too noisy and disrespectful of others.

Those dirtbags are the reason everything is the cheapest materials possible, because the assumption is they have to get replaced often. It also contributes to "the rent is too dam high".

We've owned our rental duplex for almost 2 years and we've had 5 renters so far. The property manager has only evicted one due to noise complaints from the long term tenant on the other side. After the evict notice was served the tenant reported a kitchen fire. Coincident or not - doesn't matter - it cost me about $5,000.

[Piotrsko]

My brother who was an federal arson investigator on a military base said kitchen fires of known origins are extremely common: fried food

[JSH]

Originally Posted by Piotrsko

My brother who was an federal arson investigator on a military base said kitchen fires of known origins are extremely common: fried food

Could be. This was described as a grease fire in a pan. It destroyed the stove, refrigerator, blackened the walls in the kitchen, and required a full cleaning of the house. Also a few month's rent lost.

However, as Redpoint said - the renter's pay in the end. The rent factors in 20% for damage and repairs.

People say: "How can you charge so much for rent when a mortgage on the property is so much less?" This is why. Taxes, utilities, maintenance, insurance, management fees, damage, lost rent, legal fees, etc. Gross rent collection is 3.5 times more than the mortgage but in the end it only clears 5% return on investment. There is a lot of risk for that low of a return.

[redpoint5]

My previous landlord, friend, and roommate rented out the whole townhouse after we both moved on to houses, and the tenants destroyed it. There was a solid ring of black oil around the finished white walls of the garage where the hobby mechanic braced against the wall with oil soaked hands, so thorough that you couldn't make out individual hand prints. Inside the cats had peed through all carpets, padding, and underlayment. I forget the details of how the fridge, range, and microwave were destroyed. 100% new flooring required. New appliances. New paint. The damage was isolated to 1700 sq/ft of the 3 bedroom 2.5 bath property, but it could have been worse.

I once gave a tenant an extra 2 weeks to make a rent payment, and for that grace period was rewarded with a hammer to all the walls when eviction notice was served.

20% of renters are dirtbag leaches on society. That isn't to say there aren't "reasons" that explain their destructive behavior, as everything in the universe has an explanation given sufficient understanding, but destruction has to be contained regardless.

[Piotrsko]

Originally Posted by JSH

Could be. This was described as a grease fire in a pan. It destroyed the stove, refrigerator, blackened the walls in the kitchen, and required a full cleaning of the house. Also a few month's rent lost.

However, as Redpoint said - the renter's pay in the end. The rent factors in 20% for damage and repairs.

People say: "How can you charge so much for rent when a mortgage on the property is so much less?" This is why. Taxes, utilities, maintenance, insurance, management fees, damage, lost rent, legal fees, etc. Gross rent collection is 3.5 times more than the mortgage but in the end it only clears 5% return on investment. There is a lot of risk for that low of a return.

Is this still true with the higher mortgage levels of the past couple of years?

I suppose the 3.5% doesn't include the value escalation on sale? I know several that don't make money until the eventual sale

[JSH]

Originally Posted by Piotrsko

Is this still true with the higher mortgage levels of the past couple of years?

I suppose the 3.5% doesn't include the value escalation on sale? I know several that don't make money until the eventual sale

No, I'm not including potential property value increases in my ROI. Those are not guaranteed and I've seen first hand property values plummet twice. Once to due a industry leaving town and again back in 2008. I will not buy a property that doesn't have positive cash flow on day 1.

We paid $95,000 for our rental duplex in 2020. It sold for $98,000 in 1999. 20 years and a loss even before adjusting for inflation.

My parent's house is worth $100K less than when they bought it when adjusted for inflation.

We paid cash but if we had a mortgage it would be about $450 a month on a 30 year. The rent is $700 per side.

To date we made a 5.4% annualized return on that $95,000 investment. The drumbeat that property owners are screwing over renters gets really old when you look at the financials.

EDIT: Another thing to factor in when talking about the appreciation of a rental property is that that gain is taxable. Property owners are also allowed to depreciate a property at 3.63% per year for 27 years but if you take that option you are reducing your cost basis. So if I depreciate my rental to $45,000 and sell it for $145,000 I have to pay taxes on a $100,000 gain not the $50,000 from the original purchase price.

[Piotrsko]

Not much return on equity there, but how did the income taxes work out? And you did end up with the cash value of the house on sale, although a savings account or targeted date fund might have had better returns during the same period.

Didn't seem to me the being a landlord was ever worth the added hassle

[JSH]

Originally Posted by Piotrsko

Not much return on equity there, but how did the income taxes work out? And you did end up with the cash value of the house on sale, although a savings account or targeted date fund might have had better returns during the same period.

Didn't seem to me the being a landlord was ever worth the added hassle

No not much return on the money invested. With the depreciation and other tax advantages only about 1/3 of that profit was taxable and was taxed at our normal tax bracket. (Income taxes aren't factored into that ROI)

Yes, I have the cash value of the house as an asset on my balance sheet. I could borrow against it or sell it to generate cash. The problem with that is both methods have high fees to access that money. If I take out a loan I pay loan fees plus interest. If I sell the house I lose more than 6% to realtor and other fees.

My wife and I decided to invest in real estate for diversity. We have maxed out all the taxed advantages ways to invest (401K, IRA, HSA) so and additional investing is taxable. It is also a different kind of revenue stream. We will be retiring soon and start drawing on our retirement and investment accounts. About the worst situation you can be in in retirement is to have a major downturn and be forced to sell stocks and other assets to pay your day to day bills while the market is down. For most people one of the last things they stop paying is their rent because they need a place to live. (Of course that was before the new paradigm where the Federal and State governments said people didn't have to pay rent AND they couldn't be evicted)

It is also a way to stay invested in real estate while selling our personal house and going mobile. In worst case scenarios if investments went bad we would still have a paid off place to live.