I’m being tempted folks. Talk me out of it.
I could do this fairly easily at these prices. And there’s a real dearth of rental properties in town.
It would cost you a fortune to fix those places up, and as soon as you rent it to someone they’re just gonna destroy it.
Besides you should save your money or donate it to philanthropic things. Like the Abbie Carmichael Law School Fund. 
Speaking as a current landlord of several rental properties let me just take this opportunity to say RENTERS SUCK. (toned down for IMHO). I have yet to have one leave the property without
a) Trashing the carpet
or
b) Leaving holes in the wall where the doors meet the wall
or
c) Being way behind on rent
or
d) Taking part of the house with them. Anything from curtain rods to the stove seems to be fair game.
I’m sure there is more that I can’t think of right now.
All of that being said I wouldn’t be in the business if it didn’t make a nice supplemental income. I can’t think of a better way to prepare for an early retirement.
Ya got me drooling. Those are some pretty attractive prices compared to homes for sale in my area.
While I wouldn’t try to talk you out of owning rental properties, I can tell you that every horror story you’ve ever heard is true and worse.
Those two homes are nearly 100 years old and while I can tell there has been some updating you can expect lots of maintenance problems. A thorough inspection is in order before you ever even consider purchase.
To fit my criteria, I’d be looking for homes that need lipstick but NO major refurbishing. Paint is cheap. I’d check the rental market to see if it could support rent on the first house of 450/mo. and 675/mo. on the second one.
Unless you are REALLY a hands on sorta person, I’d suggest hiring a professional property manager to manage your investment for you. In my mind, we are well worth our fees.
Seconding what bare said. My GF has a law degree and she owns a real estate company. She handles the business end of my deals. If you are not very good at fixer up kind of stuff think it over very hard before getting into this. There will be a lot of this type of work most likely.
Well, restoring an old house certainly doesn’t scare me as I’m currently doing my second one. Though, admittedly, I’m of the phonebook-checkbook type of restorer. I figure there are people who can do it better than me and I should let them.
And I would have a local realtor manage the property simply due to the connections in town they’d have.
Tempted…tempted…
My guess is that you are experiencing the opposite of “buyer’s remorse.”
You just moved into a neighborhood with homes that are priced SO FAR BELOW the area you just left that you think these houses just HAVE to be a deal at those prices.
This is OHIO, John. Where the living is cheap and so are the people.
I advise against, especially since you aren’t gonna use sweat equity.
Just to add a few comments to those above…when I was looking for a rental, I wanted one with brick walls, slab foundation with ceramic tiles (no rugs), and minimal landscaping. As close as possible to bulletproof. Neighborhood was very important, as it often determines the type of renter that you will be attracting, and sets the tone (to a degree) for lawn care, etc.
I also bought a house that I felt would keep its value, and could be sold easily in the future.
Also, please consider using a management company! Mine charges 10%, and takes care of all the problems. They know who to call and what a resonable price is for work that needs to done, so they probably actually save me money.
My rental makes a nice supplement to my retirement, and someday I may sell my large current home and move into the rental.
Good Luck!
Dude - seriously. You’re near me now. Buy a house in Canton and rent it to me. We’ll fix it up for you and we’re wonderful renters. All I ask is that you let me paint and do pretty things:).
It’s a win-win situation! We want a house, you want a good tenant. Hey, I come with the Straight Dope Seal of Approval! What more can you ask?
Ava
Yeah, we’ve been here before avabeth. First you want to re-paint my rental… and make it pretty in purple with pink polka dots! Then, in spite of the no pets rule, you want to move your cousins’ three Doberman Pinchers in…only for a week.
I am of the opinion that there will always be renters, even if you offered to give someone a home. I LOVE the business, I have seldom had problems. I do screen HARD! I never take the first qualified tenant, rather wait until things feel just right.
I’ve been in the business for a long time and know most of the BS stories and then some.
Most all of the hard luck stories you hear are from folks hearing/thinking of buying a second home as an investment.
Most of my owners are blind owners, they get a statement and a check every month. They don’t get 1am calls about toilets overflowing or the light doesn’t work (because we didn’t try a new light bulb). When a neglected roofing problem causes the bedroom ceiling to cave in, killing their cockatoo, I have already warned you about the potential problem, gotten three estimates to fix the situation, and do fix the problem…all while keeping the great tenant in their home and making things right.
I not only screen for great tenants, I take any BS calls and respond to them. Not only that, but I charge for my time, which is 100% deductable on your taxes. If you respond to a tenant problem as an owner, you eat it.
Property Management is the way to go.
Actually, it would be sky blue with lemon yellow polka dots - but I could be talked into the purple and pink 
. And we don’t like dogs much - well, I do, but the fiance doesn’t like them at all. However, we’re getting a turtle - does that matter?
Actually, this thread’s rather interesting to me - my father-in-law wants us to buy a duplex and rent the other half out. He said he’ll take care of the other tenants, but we’re still hesitant. I’m slowly backing away from the idea after reading about other experiences.
Ava
Turtles are the WORST, don’t ask me why I know.
Really, I don’t have a problem with my tenants doing a bit of re-decorating, I encourage it actually, maybe even to the point of purchasing the paint! happy tenants are long term tenants. What I DO want is the rental returned to me in the same condition it was accepted in.
As a property manager, I want the capability of ordering one type of paint that I have experience with and I want only one or at the most two color formulations. I still have unused cans of paint from my earlier experiments of letting tenants make their own statements.
You should let your father-in-law purchase the duplex and rent directly from him. Don’t let someone talk you into owning rental property at your expense, without your direct input. Except, perhaps in the case of a real property manager.
Sam is certainly right about my still being in shock mode over housing prices here in Marietta…no doubt about that!
But I’m still tempted. We could easily afford another house payment the size of the one I’ve got now ($582 per month) and some of these places are cheaper.
These are definitely on the cheap side for the city. I’m trying to find ones that are priced cheaper but are in the nicer parts of town.
Amazingly, there’s quite a bit of snobbery in town over which neighborhood one lives in here. Even though the entire town can be walked across in less than an hour. I find that astonishingly small minded.
I would do it. We are actually considering it too, even in the housing market we live in, since we just refinanced our 30 yr mortgage down to a 15, which will save us about $280K! Real estate is a fantastic investment. My dad always says, never sell a house if you can help it!
My parents rent out the house I grew up in. Yeah, lots of renters suck, but they’ve gotten some good ones too, mostly because the rent is so high that crack heads and slackers can’t afford it! They get mostly families who rent for a year while they remodel their own house.
My dad handles the repairs himself unless it’s something major. A real estate guy handles getting and researching the renters.
Boy, at those prices even I could afford to buy a house, and then I could stop being a dreaded RENTER. Didn’t know we were so universally hated just for being too poor to buy, or for wanting something other than pure white walls, or for not wanting to kill the pets we’ve owned and loved for years before finding ourself in a depressed financial situation. If you’d install doorstops you wouldn’t get those holes in the walls, you know.
The last house I rented was 100 years old. One day my son lost his footing and fell against the wall…which was very old plaster…and it shattered. We waited a while to tell the landlord, because the day after we moved in, when I was opening a drawer in the kitchen, the front of the drawer fell off. The landlord charged me $22 to fix it. I could only imagine what the wall would cost. The ceiling in my bedroom started to fall down. I propped it up with a 2x4 and called the landlord. A year later, I’m still stepping around a 2x4, and have hidden the situation from a rental inspector. Eight months later, when my inspection comes up again, I leave the bedroom door open. The ceiling finally got fixed. When we moved in there was a broken floor register in my daughter’s room which the landlord said would be replaced…instead, he repaired it with plastic twist ties, so my daughter put a chair over it so no one would step on it. Three years later, she has some friends over who moved the chair, and then someone steps on the register, and their foot goes down through the dining room ceiling. Thank God they weren’t injured and didn’t sue.
After we moved out, they gutted the house and replaced everything…floors, walls…hope they added heat to the upstairs since we never had any. The work should have been done years earlier. Nothing we did was malicious or intentional…it was just an old house, and I let a lot of things slide (like the no-heat in my daughter’s room) because the rent was affordable.
Not all landlords are saints, and not all renters are scum.
Of course not- it’s the terrible ones who give the rest a bad name.
For my parents, it was the “poor struggling college students.” From the beginning, my dad was adamant that they would never rent to a group of students. Hell, they raised me, so that decision was probably my fault!
He broke his vow when sold a bill of goods by three (or four? or five?) college guys who were renting the house together. Oh no sir, no parties, we’re hardworking, blah blah…
The cops came to the house 18 times in two weeks (the homeowner begins to accumulate escalating fines after 2 visits). An interior door was turned into kindling. The rent and utilities were never paid (the utilites were still in the realtor’s name, as the house had been vacant for a while). The beautiful built-in brick bar-be-que int he back yard was wrecked. There was trash and shit everywhere. Mail was arriving for people who were never on the lease. My parent shad to take legal action to evict these pricks.
And one kid’s dad had the nerve to say he’d sue to get the damage deposit back! Once he heard someone other than his son tell the story, that is.
So, it’ll never happen again. Too bad, becaue I’m sure some really nice people won’t get considered as possible tenants. But this ain’t a charity.