Its yours

What tools will you need?  Ok this business can really get out of hand when it comes to tools.  They are deductible so it is really easy to go overboard and buy things that, as a landlord, you will rarely if ever use.  In having done most of my own work on properties there are a certain number of tools that you will use all of the time.  Some you will use occasionally and some you will use rarely.  Number one on your list should be a good cordless drill.  Something with at least 12 volts.  That will give it the power to put in sheetrock screws.  This will also have the speed to mix paint and joint compound.  Get one that comes with two batteries.  Nothing is more frustrating and time consuming than a dead drill.  The initial impulse for most guys is to buy the biggest most powerful drill on the market.  When you are hanging blinds or working above your head you WILL regret that heavy drill.  You will also, in your make ready work, need several putty knives and sheetrock type putty knives.  I use one three inch joint compound knife.  Be sure to get one with some flex for doing your tape work.  The very stiff ones are hard for newer people to use.  You will also need a six and eight inch float knife.  They look like very wide putty knives.  A good utility knife is indispensable.  Just make sure you can change the blades without any tools. That just slows things down. You can buy now very cheap mud trays.  These are twelve inch pans around three inches deep with tapered sides and make taping and floating your patches much easier.  A serviceable flashlight.  Several good paintbrushes.  Now when I say good this is what I mean.  When you are painting enamel paint.  Like doors and windowsills.  You need a good brush for good results.  If you spend less than twenty dollars it is not a good brush.  When you paint your walls and do touch up work around the house use the cheapest ones you can buy. When you are painting with an oil base paint, that means clean up with paint thinner, you need to use a really good brush.  You need a caulk gun. Also get yourself one of those screwdrivers with phillips head and slotted in the same handle. Finally get yourself a good home improvement manual.  I highly recommend (READERS DIGEST NEW FIX-IT-YOURSELF MANUAL)  For everyday repairs this will be your bible.

Alright you did your homework and now you are the proud, if somewhat nervous owner of a rental house. Go for it.  Let me tell you a mistake I have seen too many times. This is not your house that you live in.  Nor is it likely to be someone’s dream house.  Nothing fancy here. Good quality serviceable appliances and fixtures.  I always buy either used appliances or scratch and dent stuff.  Look in the phonebook.  I am not very internet savvy so I say phonebook.  They are not hard to find.  Also when it comes to plumbing fixtures this is not the time to scrimp.  Buy American.  Not for any reason besides they are repairable.  If you buy some cheap foreign faucet you will play hell trying to find parts.  They do not hold up and you will need parts. Being able to walk into a plumbing supply house and get a new valve stem (I will explain later) is much better than replacing the fixture again. 

I like mini blinds. If the ones in the house are in good shape take them down and wash them.  The best way is with dishwasher detergent in a Jacuzzi tub. Second best is the car wash. LOW PRESSURE ONLY.  Let them dry and rehang them. 

Now you are ready to go.  But, you ask, how do you know how much to rent it for?  Again I sort of stumbled on this.  Get a local pennysaver paper.  The kind that are free in every convenience store.  Look in the advertisements for apartments for lease. They always list the lowest price they have for a three bedroom apartment.  People are obviously paying that to rent a three bedroom apartment.  They will pay more for a house and a yard.  See don’t make this stuff rocket science.  This is a very simple business. 

Tenants

You will hear lots of opinions on this from people far smarter than me.  I will tell you what works for me.  First lets remember something.  These are not your friends.  You should not care if they are republicans or democrats. Vegans or deer hunters.  Gay or strait.  Black or white.  They are customers.  It is wrong, illegal and stupid to discriminate against someone for those kind of reasons.  Here is why.  I am sure some people out there have problems with minorities, well, you might but let me tell you how it really is.  This is not just me talking it is standard knowledge among seasoned landlords.  If you are going to get screwed.  I mean really taken to the cleaners by a tenant.  I am talking forced evictions, trashing the house sort of screwed.  They will be white.  Sorry but that is just the way it is.  Now I may have a problem with the Nazis or something after this but it is absolutely the truth.  I have had tons of Hispanic tenants.  Quite a few African Americans.  Several, uh, alternate lifestyle groups.  And every single time I really got bent over and had in the most intimate way they have been white folks.  So discrimination is playing a losing hand.  Unless I guess you don’t rent to white people. But that will not work either. The people I will never lease to under any conditions are people who work for charitable organizations. I have done so twice.  Both times I got really taken to the cleaners. The term involuntary penetration comes to mind.  The first one moved in and told me to pick up the rent after the first day.  Being new I agreed.  When I showed up the next day I was told that he knew the law and I would never get another penny out of him.  He further assured me that he would move one day before the police physically removed him from the property and that if I gave him any trouble he would tie me up in court for several months more.  It took two months and several hundred dollars to get him and his children out. The second one moved his drug addicted unemployed wife in paid one month and left her there.  Now I was stuck with a very nice, if somewhat addled woman with no income and no place to go.  Upon calling him I was informed that they had been separated for some time. Both of these tenants worked for a national charity I am sure you would recognize.

Let me digress with a funny story about tenants.  I had a tenant in a nicer, $950.00 per month, house near Houston.  She was a homemaker and he worked the ship channel and was going to chiropractic college at night.  They rented from me for several years.  I went over after the rent was later than usual and the phone had been shut off to see if he was still there.  I knocked and getting no answer and seeing no cars let myself in to see if he had moved out.  In the middle of the living room was a king size bed clad in black silk sheets. Three really expensive video cameras were mounted on tripods pointed at the bed.  On the low mantle were about three hundred blank video tapes. And affixed to one wall was the most unbelievable collection of rubber and latex whips, paddles, blindfolds, and a large selection of what appeared to be a large collection of sea creatures and vegetables of assorted sizes and dimensions made of rubber.  Needless to say I backed out, carefully touching nothing.  I left to ponder my unenviable position and wonder where I could get some sort of hazardous material suit.  Several days later he called me explaining he did not have the rent but wanted his stuff.  I was tickled to death at not having to box up and remove the stuff. Surely I would be pulled over and searched and while my reputation is not the best I would like to be able to take my kids to school without looks from other parents.  He removed his hobby equipment and I ripped up the carpet and bleached everything, myself included.

The number one trick I use to check a tenant is what I call the car test.  Admittedly it may be flawed but it seems to work better than anything else I have tried.  While the prospective tenant is looking at your house make an excuse to go to your car.  As you do walk past their car.  If they want to rent a $600.00 a month house and drive a new luxury car let them go.  If their car looks like the dumpster behind a fast food place pass on them as well.  What I like to see is a reasonably priced mid value, well cared for car. Age is not really an issue. If it looks fairly well cared for that is a good reflection of the people.  Here is one of the golden, never break rules in this game.  If someone shows up looking at your house with ANY SORT of a sob story don’t do it.  If they tell you how bad their current landlord is, just run. Fake a heart attack if you have to but get out.  In my experience these people will cost you far more in time, money and blood pressure than they are worth.  Never break this rule.  Well you say that is all well and good but how do you get out of it.  Lets say they show up complaining about their job or heath issues and they love the house.  You say “wow did you see that car that just left they gave me an application and want the house as well”.  I have never had one of these people call back to check and see if the house was still available. 

Many landlords are fond of running a credit check on prospective tenants.  If they have a good credit rating then chances are they will be good responsible tenants.  Most of the tenants I have screened do not have good credit. Most will have some sort of ding. Lets face it if they had an unforeseen illness or something that is unavoidable.  But what about a foreclosure or a repossession, maybe they had a bankruptcy, what then?  Well the car test works and so does going with your gut.  If the credit was good until some calamity befell them, well that might be ok.  Years of bad loans, multiple repossessions and you will be on that list eventually as well. Honestly checking the job history is better to me than a credit report.

 Checking the references is a good bet too.  Just be careful.  If someone is really a bad tenant.  Spends most of their time one step ahead of the marshals and had destroyed the house they rent now.  Do you really think the current landlord you call will tell you the truth?  If he is just dying to get rid of these bums you think he will tell you the truth?  Sadly the answer is no and here is why. Everyone is afraid of being sued. If you call and the current landlord says he thinks the tenant sacrifices virgins and grows pot. He also thinks he may be on the sexual predator list.  He knows you will not lease to them.  He knows they may hear about the virgins and decide to sue him.  He knows he will be stuck with them for more time and money because if he tells the truth they will never move out of his rent house.  Do yourself a favor ask for the last two places the tenant has lived on your application.  Check with the landlord he had before the one he has now.  You may not hear about the virgin sacrificing but you may come closer to the truth.  Pay attention.  Your question is:  “would you lease to them again?”  That question is the one most likely to elicit a truthful response.

Deposits.  You ideally want a deposit equal to the first months rent.  So if your new tenant will be paying $700.00 a month your deposit is $700.00. Never split up a deposit. All deposits and rent for the first month must be paid in advance.  Here is why.  I have only one time had this work out right.  In all the times I used to do this it was always late and it starts everything off on the wrong foot.  You will also have to decide about pet deposits.  I am a dog lover.  So I allow pets.  I get a $100.00 non refundable pet deposit.

Ok allow me another story as this one made me a minor celebrity.  I had a house near me that I rented to a very nice topless dancer, her boyfriend, and a snake.  Yes, I got a pet deposit.  When they eventually abandoned the house they also left nine cats. Now I am not cat people.  I do have a soft spot for homeless animals. She left them inside.  No litter boxes or anything just a pile of food on the floor.  I fed them for several days and called the S.P.C.A. to come and get the cats.  At the appointed time I met a very nice woman form the Houston office.  Behind her in another truck was a film crew.  I was asked if I would be willing to be on the show Animal Cops Houston as they wanted to tape us chasing the cats and rounding them up.  So what do you do?  I signed the forms and was on Animal Planet chasing cats around my rent house.  I am occasionally on reruns so watch for me.  I will sign autographs if anyone is interested.  Nobody has been so far, but one can hope.

You must also ask how many people will be living in the house.  No more than two per bedroom.  If you get more than that in a house it will have more than the normal wear and tear at the end of the lease. 

I cannot give you a blank lease.  They are state specific.  Ask your realtor for a blank residential lease.  You may be able to find one on the internet. 

One of the main things you will hear from your friends about doing this goes something like.  “ Oh yeah, well like I wouldn’t want to get phone calls in the middle of the night about leaking toilets.”  Well I don’t like them either.  In twenty plus years if have never received a call about anything after about nine oclock.  Here is how you avoid this.  Repair allowance.  You will stipulate in your lease that any repair costing less than $75 or $100, your choice, is the tenants responsibility.  That stops most of the calls.  Now when a tenant moves into your rent house they will inevitably find something small wrong.  These repairs are your responsibility as a landlord.  After that you are off the hook for the minor things.

Let me give you my opinion on something that I have heard many landlords get very excited about. Home warranty policies.  If I am buying a house I might ask for one. This is because as an occupant of the house I can wait for repairs if I have to.  No tenant likes to wait for repairs.  I personally have no use for these companies.  They write the policy without looking at the house.  Most do not cover “just plain worn out”.  You can get one of these policies very inexpensively as an added bonus for a house you are selling.  New homeowners love them.  I would rather have a couple of hundred bucks.  Most of these companies are slow and will do anything in their power to avoid paying money for a claim or fixing things properly.  Your tenant does not want to hear that someone will come out at some point next week to check whatever is broken.

Ok there have been some requests for the sillier bits from the land lording tales.  Some will illustrate a point.  Some, unfortunately, are just.. well, odd. So lets begin.

First I will revisit the stripper, her boyfriend and the snake story.  The one that led to my television debut on Animal Cops Houston.  There is more to the story.  You see they left quite a bit of trash and junk along with the cats.  In the top of one of the closets I found a shoebox full of Polaroid pictures.  Quite a few of these pictures were worthy of being included in High Times magazine.  Several showed my previous tenants holding up pounds of marijuana and smiling for the camera.  Luckily these pictures were not taken at my property. They did, however, appear to be recently taken.  I put some of the better pictures in an envelope, wrote my name and cell phone number on it, and dropped it off with the dispatcher at the local police department.  It was not long before I was received a call from several local detectives who had me on a speakerphone.  I told them the story and invited them to meet me at the property so they could look around. We met later that afternoon at the property.  After seeing that the pictures were not taken at my house we got to talking.  They asked if I had any idea who theses people were. I just smiled and handed them a copy of the rental application that listed full names, driver’s license numbers, cell numbers and places of employment and other information. We all had a pretty good laugh at that. 

Next the SWAT team story.  I was fixing a house up that had been a rental for many years.  It was almost complete with just some minor things left to fix. I arrived at the house at around noon.  Upon entering the property I saw, in the living room, several back packs.  I also saw ice from a drink on the floor and smelled cigar smoke.  At this point the house had been vacant for a month or so and I was the only one with a key. I went outside to my truck and called the police.  Several minutes later two officers arrived and we went back inside.  There was no one in the house.  I told them that the house had been vacant and no one should be in the property.  They asked if they could look through the backpacks and see if anything interesting was inside.  I agreed and they went to work.  It was all cameras, jewelry, video games and the like.  Obviously it was stolen property.  They also found a wallet with some credit cards inside.  They checked the name and found that it belonged to the homeowner directly across the street. One officer went to investigate and look around the house and was on the radio very quickly calling the other officer for assistance.  The officer with me told me not to follow her, I did not need to be told, as the officer calling for help sounded very alarmed.  Soon I could hear sirens coming from everywhere. Smoke started coming from the other house.  I just sat in the yard and watched and wondered what in the world was going on.  Soon there were SWAT members on the street. Police cars were blocking off both ends of the street and someone showed up with a bloodhound.  So here is what they told me had happened. Two teenagers had been using my rent house for the day as storage for the stuff they were stealing from the surrounding neighborhood.  They were in the house across the street again, they had obviously been in once already to take the wallet, and were in the process of vandalizing that property.  They had seen the police arrive and decided to create a diversion by setting the house on fire. At about this time my wife called to ask how the house was coming and would I like her to bring me some lunch. The police had every intersection closed for several blocks.  There were police in riot gear with assault rifles searching the neighborhood and they were dusting for fingerprints at my rent house.  I told my wife that I could really use a cheeseburger, but doubted she could get through the roadblocks.  They wound up catching the guys, both of whom were armed, later that day. 

Pornography

As I said on my about me page I worked for the Coast Guard on a tugboat out of Kodiak Alaska. So I have been a sailor.  I have seen all those thing sailors see with regard to raunchy pictures.  That being said at one of my rental I had the misfortune to come across ten large boxes of magazines that were quite shocking even to me.  These were not something I was familiar with. Most of these would be better described as large paperback books.  Most were well over 100 pages with no writing whatsoever.  Some were as big as the old Life magazines used to be. While they did not involve anything illegal every other fetish appeared to be well represented.   So what does one do when he comes across a veritable Library Of Congress of porn.  I decided to double bag the magazines, lest they break while unloading, and take them to the dump.  I can tell you I drove very carefully.  The prospect of a major accident with me at the center and all those magazines flying out of my truck was nothing I was interested in. In the end it all went well. I am just glad the dump went by volume not weight, as my truck bed was loaded to overflowing with all that porn.

Drugs

You will, being in this business long enough, find drugs on your property.  It is volume that should concern you.  At one property I found a dozen or so very healthy and fairly good size marijuana plants.  For the uninitiated, there are certain circumstances where your rental property can be seized by law enforcement due to illegal activity taking place at the property.  That sounds like a losing investment to me.  These plants were too big to flush down the toilet or put down the garbage disposal, these two are my favorite ways to dispose of this stuff, so I had to find another way.  What I did was to fold them up into heavy trash bags, double bagged them, and loaded them in my truck on garbage day.  Then I went out and loaded the smelliest, ripest, most ugly trash on the street on top of it and took the whole thing to the dump.  I drove very carefully I can tell you.

Other interesting things I have found left behind include:

Well over 100 liquor bottles that had been filled with colored water.

Several guns, a trampoline, an above ground swimming pool, a cake pan shaped like a penis, numerous sexual devices, appliances of all types, a complete fireman’s uniform, a very large hookah, stuffed fish, deer heads and horns and an old fashioned pipe cutter that looks as though it would cut a large tree down, well over 50 metal fence posts with concrete stuck to the bottoms (they had been dug up) and a headstone.

So you just never know