Finally, an expansion on landlord rights!

As a landlord, there are three parts of this bill out of Wisconsin that I really like:

*Allow landlords to dispose of or sell property that trespassers leave behind

*Evict tenants who cause damage without repairing or paying for it 

*Prohibit municipalities from inspecting rental property unless someone files a complaint or the inspection is part of a broader program

You need to know when to walk away …

In The Gambler, Kenny Rogers sings that “You’ve got to know when to walk away.” He’s referring of course to playing cards. Rental properties can be the same way.  It’s tough to find one at the right price and provides a respectable cash flow. Yet sometimes when one does come along, you still have to walk away. Let me give you an example ...

I saw a “For Sale By Owner” sign in front of a duplex in an area I drove past regularly. So I made the call to see the place. It turned out the owner wanted to sell five duplexes that were on the same street. He refused to consider selling one or two separately. It was all five or nothing.

Five duplexes next to each other was an attractive thought. I was looking to expand my business. And it would make maintenance a snap, especially during the summer when the grass had to be mowed weekly. I called my mortgage broker to make sure I could borrow that much money. Still, buying them all at once was a big financial commitment.

On the outside, not too bad. CBS construction. The roofs didn’t have any missing shingles. Although I figured they would need replacing in a few years. I planned on getting my roofer to give them a good look if this deal went any further.

Inside was another story …

When he opened the door of the first unit, roaches scurried out of our way. Holes were in several walls, and there was a huge water stain on the living room ceiling. The bathtub had a three-inch rust hole towards the top.

The unit had three small bedrooms and one bath, adequate for four people—six at most. But from the piles of clothes, dishes, and baby toys it was obvious many more were calling this home.

I asked him how many people lived there. “As long as they pay me cash each week, I don’t know and I don’t care,” he replied.

The other units were in about the same condition. So I told him I’d get back to him if I had further interest.

Eventually the “For Sale” sign came down. I have no idea if he sold the duplexes. I’m sure the cash flow was good. I never asked. But the concept of facing a bunch of repair work on top of collecting rent from who knows how many people each week wasn’t the deal for me. 

For more ideas on how to build a portfolio of investment properties for an income that lasts a lifetime, pick up a copy of What You Must Know BEFORE Becoming a Greedy Landlord. 

This inexpensive upgrade will boost your rental’s return

When you are prepping a rental property, a fresh coat of paint on the inside is an inexpensive way to give you one up on the competition and justify a higher rent.  

Pick one color and one brand for all rooms and all rentals. It’ll make your life so much easier. That way you buy the same thing every time. No need storing a bunch of different colors and not having the right one when you need it. I use a very light beige latex (water-based). It goes with everything, hides flaws well, and looks warmer than flat white. 

Don’t skimp on quality; you want something that has a decent chance of holding up to kids. I like Behr, but I’m sure there are others that are equally as good. Consumer Reports publishes test results of most manufacturers’ paints and stains. 

How to market your rental property …

You’ve made the decision to become a landlord; you found the perfect home to rent out. Now you’re on a hectic deadline because every day it’s empty means money out of your pocket. So you can’t dawdle.

If the property needs work, don’t wait until it’s completely done before looking for a tenant. Start showing it when you’re putting on the finishing touches, such as painting the interior or replacing the carpet. Sure, it’s nice to show a finished product. But time is not your friend.

The faster you get it rented, the faster the cash flow starts coming in. It doesn’t hurt to have lookers catch you with your hands dirty; lets them know you take pride in the property and work for a living.

Your goal is to have a qualified tenant move in the same day you do the final vacuuming.

I’ve had the best experience putting a small ad in the local newspaper. Make your ad very clear to reduce the number of frivolous calls.

Something like this:

Xxx town, 2/2, $xxx per month, 975 sq. ft., immediately available, no pets, FLS, 12-mo. lease, phone number

Word-of-mouth through real estate agents you know, people who live on the same street as your property, or your social media connections are always good.

Social media gives you more flexibility than print ads. For example, with online ads you can include color photos of a freshly mowed lawn, a well-lit kitchen, or the sparkling community pool, which can make a huge difference in the number of responses you get. While you’re writing your online ad, punch it up with more details such as walk-in closets, covered parking, or a large back yard.

Be sure to include the city and state where your rental is located.

Craigslist is another avenue to try. Zillow and Trulia also let you post a rental for free.

And when you schedule appointments with prospective tenants to see the property, make them all within a specific time frame, say 2-4 in the afternoon. That will eliminate wasting your time on “no shows,” and it will create a sense of urgency on those who show up to make a decision since they’ll see that the house is in high demand.