Oh, how cozy and charming!!
Cozy and Charming Tremont Apartment (Small and Old)
If you are thinking about buying real estate as a rental property, I would suggest that you don't. Ok -to be fair this is a very lucrative business for a lot of people, so it's not wrong for everyone. I guess I'm just not the type of person who can deal with it. According to the real estate books that we had read, we would just buy some property, get a team of people to keep it running, and then we would just sit back with our lemonade and big smiles on our faces while the money comes pouring in. That was a nice fantasy, and I suppose I believed it.
We bought our property in the Tremont area of Cleveland 3 years ago, and we immediately learned some hard lessons. As soon as we purchased our 4 unit property, the lady in the back moved out. I guess she was a friend of the previous owner, so she was probably living there free and was not excited that we would be making her pay rent. Then there was the guy who sometimes payed his rent, but we didn't know what to do because he seemed to be half blind and somewhat mentally challenged. We basically just accepted the rent from him about every other month because at least it was something. The tenants in the front house, which is the nice house, were both section 8. Oh, section 8, how you make me feel hate. In theory, it seems like it would be great that you are getting guaranteed rent from this organization instead of having to collect it from the tenants, but it's not. First of all, they rarely pay the full amount that the tenant has to pay, so you have to collect a portion anyway. Plus, you get to experience the yearly Section 8 inspection, in which they come in and tell you about all the things that you have to fix in order to keep up the great quality of life your Section 8 tenants have come to know and expect. If you are not familiar with Section 8, it is for poor working people who can't pay their rent, so it is partially paid for with goverment funds http://www.cmha.net/index.aspx.
Mau managed the property for a while when we first bought it, but then we got a 'professional' to manage it so that we wouldn't have to take tenant calls, repairs, worry about rent collection, etc. Well, we hired the wrong person. She didn't get anyone in the vacant apartment and after about a year of her bad attitude, one of our section 8 residents moved out, leaving 2 vacant units and a 3rd with the blind guy. But then he ran away in the middle of the night, so we only had 1 of the 4 rented. (We later found out that he had no water because the pipes had burst and a couple of his windows had big holes in them, so who could blame him?)
At this point we decided we would be a little more pro-active because our property was turning to shit. Yes, it was our fault that we didn't exercise more oversight over the property. And we found out the hard way that you can't trust people to do their jobs. (I will save the post about contractors for another day). Nobody will ever care like you do.
I took over the property early this year, and I'm happy to say that we now have 3 out of 4 units rented at good prices. The 4th should be ready and rented soon, and I'll get back to that in my future post about contractors. We spent so much fixing things, that it will be a couple years before we start making money from it. I suppose it is a long term investment.
So, I just wanted to share with you some of the ad that we posted on craigslist for the back apartment and in parenthesis I wrote what we really meant with those words:
Cozy and Charming Tremont Apartment (Small and Old)
We have Two 2- Bedroom Apartments Available
(not really because one isn't renovated despite the contractor promising it would be for the past 2 months)
A front and a back unit - both are downstairs units
We provide the stove and refrigerator in the kitchen and a shared washer/dryer in the basement.
(Because we know you will not live in this shit hole unless we provide these things)
Water is included in the price (because we are not allowed to charge you). New windows throughout to help with that heating bill (but with the heating unit being original from 1870, I'm sure most of your heat is left in the basement anyway - Also, I hope that you don't die of carbon monoxide poisoning because the flame is buring orange and yellow instead of blue and purple. Our contractor was going to fix that - and I'm sure he will - as soon as he gets out of jail), new laminate flooring in bedrooms and living area, new paint throughout (just don't lean on some of the walls, because they are made of paper, and you will make a hole in it).
The bathtubs have been redone (because they had cracks and someone had painted them).
Each is 527 square feet, so they are cozy apartments (your cat may be comfortable in one of the bedrooms, but you won't).
Because of the size, the apartments would work best for a single person or a couple, so that one bedroom could be the computer room/office (and because kids throw stuff down the registers and othewise wreak havoc on the place).
Very Quiet Location (because it's behind another house - great for those freezing, snowy days when you have just been grocery shopping and you have to make 5 trips back and forth to your car which is out on the street - 50 yards away.)
Private fenced yard (except where it looks like a car ran over it)
Cats and Dogs OK with certain limitations (limitations meaning your brand new puppy who is sure to piss and shit all over our place while you are potty training him).
A little info about Tremont......... Welcome to historic Tremont, a dynamic neighborhood with a fascinating past and an exciting future.(This neighborhood used to be the ghetto a few years ago, but now it's trendy!)