Tuesday, May 3, 2016

Obama forces political-correctness on landlords

In What You Must Know BEFORE Becoming a Greedy Landlord, I included a section on tenant selection. I wrote:

Most people are honest and hardworking. And I’d venture to say that 96 percent would be terrific tenants. But you need to screen them all to sort out the 4 percent who are potential problems. 

My biggest concern is getting stuck with a tenant who has a history of destroying previous rentals or not paying the rent. And I tell them upfront that if this type of thing shows up, the deal is dead. The tenant pays the background-check fee and gets it back if they pass.

If you are a landlord or plan to buy a rental property, you should know that you cannot base tenant selection solely on race, color, religion, sex, familial status, national origin or disability.

Now the Obama administration says that refusing to rent to someone with a criminal record could be a form of intentional discrimination and could get you in legal hot water.

First, the facts

As many as 100 million U.S. adults — or nearly one-third of the population — have a criminal record of some sort. Our prison population of 2.2 million adults is by far the largest in the world. As of 2012, the U.S. accounted for only about five percent of the world’s population, yet almost one quarter of the world’s prisoners were held in American prisons.

African Americans and Hispanics are arrested, convicted and incarcerated at rates disproportionate to their share of the general population. Across all age groups, the imprisonment rates for African American males is almost six times greater than for White males, and for Hispanic males, it is over twice that for non-Hispanic White males.

Now, Obama’s rationale

President Obama and HUD have concluded that based on the above facts, criminal records create barriers to housing that are likely to have a disproportionate impact on minority home seekers.

What all this means, as I interpret it, is that if you exclude someone because of a prior conviction, you must be able to prove that it was necessary to achieve a substantial, legitimate, nondiscriminatory interest. What’s more, you must apply the same standard to rental applicants of all races and colors.


The sad thing is that this has nothing to do with fixing our broken criminal justice system or the fact that there are too many attorneys running around lose.

It’s simply shoving political correctness down the throats of hardworking Americans who invest their time and money to provide a decent home at a fair price for others to live.  

And Congressman Dan Donovan (R-NY) thinks it’s wrong, too. He blasted HUD’s guidelines in an April 26, letter to Secretary Julian Castro. You can read it here.

The bottom line is that I can deal with someone who has had problems with the law. Everyone deserves a second or third chance. But whether I rent to them should be a decision I make based on what the background check reveals and my gut instincts … not what Obama and Washington bureaucrats determine is correct for my business.  

Tuesday, April 26, 2016

I’m famous!


Well, not exactly.

I was at Home Depot loading up my van for a project my wife roped me into when a guy walked by pushing a cart. “Hey,” he said. “Aren’t you that greedy landlord?”

Thinking he might be some tenant whom I had to evict, I cautiously looked at him.

“I read your book. The one about being a greedy landlord, so I knew you lived in this area. I’m following you on Facebook now. Your picture’s there.” He shook my hand.

“I’ve been in the business for around 30 years best I can remember. Single-family homes, warehouses, industrial, you name it I’ve owned it. You had a few good ideas that I had never tried.”


“But I gotta disagree with you on one thing.”

“Oh?”

“Yeah, the part where you say to stay away from condos. I bought my first one 12 years ago. Now I have 15. My wife and I are getting up in years, and we travel quite a bit, so it’s worked out ok. I’ve learned a few lessons along the way, though.”

“I’d love to hear them.”

“I study the HOA documents, including the financials. Boring as hell but important to know what you’re getting into, especially regarding renting out a unit. Then I talk to the sellers to find out how easy it is to get along with the board. But you can’t always believe them.

“I walk or ride my bicycle around the neighborhood. Better than driving around in my truck. Let’s you see the place up close and personal. How well do they maintain the common grounds, the pool area, parking lot? How well do the other owners take care of their places? Are fences falling down? Stuff like that.

“Then if I actually buy the place, I volunteer for the board. Or at the least I show up for the board meetings so I can speak up if they try to sneak something in about rentals. 

"What I’m saying is that the way our area is developing if you eliminate HOAs entirely, you could be missing out on some nice rentals.”

We said our goodbyes, and I thanked him again for reading my book.

While driving home I thought about what he had said ...

Just about all the new homes in our area have HOAs. And I’m always open to an opinion that’s different from mine … after all, that’s what makes a market. But I’ve had the most success with older single-family homes in working-class neighborhoods. So for now I’ll stick to my Rule #4 and avoid condos and HOAs.

For more ideas on buying and managing rental properties, pick up a copy of What You Must Know BEFORE Becoming a Greedy Landlord. It’s available from Barnes & Noble, Booklocker, iTunes, and kobo. You can also order it in paperback and Kindle formats at Amazon.


Wednesday, March 30, 2016

101 years old and still a landlord


This 101-year-old lady has long history of being a landlord. Read her story here. 

Wednesday, March 23, 2016

Being less sad works for me


It took these brilliant Canadian researchers to discover that money may be a more effective tool for reducing sadness than enhancing happiness. Put another way, money might not make you happy, but it can help you feel less sad.
Less sad works for me. So I’ll take having a few bucks in my pocket over being broke any day.

Wednesday, March 16, 2016

How to settle disputes among tenants


A reader sent a question to me, and I thought it would be good to post my answer for all to read.

Hi George,

You often talk about how landlords can deal with problems they’re having with tenants, like collecting past due rent and not taking care of the home. But how about dealing with issues among tenants themselves? I have a situation with two tenants fighting over an air freshener that is getting me stuck in the middle.

Thanks,
Ned

Hi Ned,

Best I can do is tell you how I handled something similar …

I once owned a 10-unit, two-story apartment building. One of my tenants was a middle-aged couple who had a disabled adult daughter. The young woman would spend hours a day gathering aluminum cans, plastic bottles, and glass jars from along the streets and trash cans she came across. Then she would bring them back to the apartment where she had set up a table on the patio to sort out her findings.

The tenant living above them called me. She said the goings on downstairs was creating a health hazard. Rats were running around and the smell was terrible.

I confronted the downstairs tenant who explained that once a week he’d load the items in his van and take them to the recycler. It gave his daughter something to do, plus made her feel good that she was making a little money.

Next I had my exterminator check the patio area out. He couldn’t find any trace of rats or any other rodents. The space was clean since the daughter thoroughly hosed it down each day.

Then I went back to the upstairs tenant and relayed the findings. Didn’t matter. She still wanted it to stop. And if I didn’t do something about it, she’d call building and zoning.

The last thing I wanted was some inspector snooping around, because if they look hard enough, they find something wrong.

So I decided to get both tenants to neutral territory … a local coffee shop … to discuss this together.

I had the upstairs tenant explain what she found objectionable. Then I asked the downstairs tenant explain how this activity was therapy for his disabled daughter.

The upstairs tenant wouldn’t budge.

So then I asked her when she found the collecting of recyclables to be the most objectionable.

“When I’m trying to watch my shows. All that noise from their patio.”

“What are your favorite shows?”

“Judge Judy and Judge Brown.”

“I like them too,” said the downstairs tenant.

The two of them back and forth recapping some of their favorite episodes.

I eventually managed to find out that those shows were on from noon until 2:00 pm. And I got the upstairs tenant to agree that if there was no noise coming from the downstairs patio during those hours, she would be happy.

The point here, Ned, is that if tenants are squabbling with each other, you best get in the middle and take control. Otherwise, you have no idea how it could turn out. You could lose one or both of them as tenants or end up in court yourself.


Good luck!

For more ideas on buying and managing rental properties, pick up a copy of What You Must Know BEFORE Becoming a Greedy Landlord. It’s available from Barnes & Noble, Booklocker, iTunes, and kobo. You can also order it in paperback and Kindle formats at Amazon

Tuesday, March 1, 2016

$305 BILLION for long-term care with no end in sight!


According to the Pew Research Center 10,000 Baby Boomers turn 65 every day. And that trend will not slow down for many years to come. Neither will the demand for long-term care services.

In fact, a recent report revealed that Americans spent $305 BILLION in 2015 on long-term care with in-home care leading the way as the most affordable option.

You can read more about the report here. 


Best wishes,

George

P.S.
You’ve worked hard all your life ... did without so you could invest for the future ... now you look forward to retiring soon. Traveling, playing golf, or pursing another career. But do you know you are about to face the biggest financial risk in your life? 

Not sure? Then you must read A Boomer’s Guide to Long-term Care. 

Monday, February 29, 2016

One of the wackiest ideas for soaring prescription costs I’ve ever heard

Taking out a mortgage to buy your next dose of meds? That’s what two professors offer as a solution to our country’s health care crisis.

I’m all for a market-based solution to soaring med costs. But this has to be one of the wackiest ideas I’ve ever heard.

The way I see it, Wall Street banks, like JP Morgan Chase and Goldman Sachs, would bundle HCLs as they did with mortgages for sale to investors. Then when the loans blow up because a higher than expected number of patients die, aren’t cured, or can no longer make their payments, taxpayers would get stuck with the bill.