Any Landlords here?

[NumberFive]

I've recently been thinking of picking up a place during this downturn and becoming a landlord. However, I have to admit that I definitely don't fully understand the work, details, or paperwork involved.

Does anybody here rent a place out? And if so, is it a difficult or painful process?

[Full Mountain]

I was a resident manager for 2 buildings for a year it has to be the most stressful things that you can possibly do, between rent collection, maintenance, etc....(throw away your saturdays if you have a yard at the place) IMO its not worth the income that you might get from it

[Jimby]

This morning my dentist was telling me his horror stories of being a landlord.
One time he went over to collect the rent and smelled something bad and he found they had cages of live chickens in the basement.
Another tenant thought the heat vent in the floor was a built-in vacuum system and was sweeping their dirt into the vents!

[NumberFive]

Appreciate the thoughts... it's something I've considered, but having started reading some of the things that one needs to do, started to think there's a better place for investment, considering it wouldn't be a full-time job for me... just an "income on the side". Heck, even the apparent paperwork required (contracts, notices, etc) seems like more headache than I would like. But I wanted to see if anybody here had their own advice or experiences.

[freeweed]

Originally Posted by NumberFive

Appreciate the thoughts... it's something I've considered, but having started reading some of the things that one needs to do, started to think there's a better place for investment, considering it wouldn't be a full-time job for me... just an "income on the side". Heck, even the apparent paperwork required (contracts, notices, etc) seems like more headache than I would like. But I wanted to see if anybody here had their own advice or experiences.

Never done it, but I've had many friends who have and back when I rented, I used to chat with my landlord a lot about it. I think he wanted a sympathetic ear to whine to more than anything else, and whine he did.

Let's just say the part of your comment that I bolded made me laugh out loud. I don't know any landlords who do this on the side.

What inevitably happens is you start with one property, that's "money on the side" but you find yourself having to run around a lot to do all the work involved, which eats into your "regular job" time. So, you pick up another property, because what the hell, if you're spending this time away from work you might as well kill 2 birds at the same time, and also you need the money as your regular income is starting to suffer.

Repeat until you're a full-time landlord. I've seen it dozens of times.

Now, if you were smart enough to pick up 7-10 properties in say the mid 90s (like my last landlord had), and sweated it out for a decade or so, you stood to make a KILLING in Calgary when selling them. At one point he had well in excess of $2 million in equity, keeping in mind what happened to property values here. That's plenty of money to pay off any conceivable personal debt, and live quite comfortably for some time, with some part-time work thrown in for extra spending cash. All for a decade of work, so not bad.

Of course, the idiot didn't sell any of his properties because like most real estate investors, he got greedy, saw nothing but dollar signs, and assumed the market was going to go up forever. He's currently still a full-time landlord as his property values have sank enough that while he'd definitely make money, it's nowhere near enough to retire on and he's been away from work so long that it's all he knows how to do anymore.

Also, contrary to what the renters on these forums would have you believe, the rent:property value ratio in this city is freakishly low, ie: rents are way too cheap here. Well, or property values are way too expensive but until we see large numbers of defaults I'd argue that one. So you won't make the money you think renting, and then it's DEFINITELY about the investment - and do you really think your property values are likely to double in, say, the next 10 years?

All in all, this is just about the last place I'd invest in rental properties. Low rent + low value increase for the forseeable future = bad investment. You have to love being a landlord (and I've known some that do).

[NumberFive]

Originally Posted by freeweed

Never done it, but I've had many friends who have and back when I rented, I used to chat with my landlord a lot about it. I think he wanted a sympathetic ear to whine to more than anything else, and whine he did.

Let's just say the part of your comment that I bolded made me laugh out loud. I don't know any landlords who do this on the side.

What inevitably happens is you start with one property, that's "money on the side" but you find yourself having to run around a lot to do all the work involved, which eats into your "regular job" time. So, you pick up another property, because what the hell, if you're spending this time away from work you might as well kill 2 birds at the same time, and also you need the money as your regular income is starting to suffer.

Repeat until you're a full-time landlord. I've seen it dozens of times.

Now, if you were smart enough to pick up 7-10 properties in say the mid 90s (like my last landlord had), and sweated it out for a decade or so, you stood to make a KILLING in Calgary when selling them. At one point he had well in excess of $2 million in equity, keeping in mind what happened to property values here. That's plenty of money to pay off any conceivable personal debt, and live quite comfortably for some time, with some part-time work thrown in for extra spending cash. All for a decade of work, so not bad.

Of course, the idiot didn't sell any of his properties because like most real estate investors, he got greedy, saw nothing but dollar signs, and assumed the market was going to go up forever. He's currently still a full-time landlord as his property values have sank enough that while he'd definitely make money, it's nowhere near enough to retire on and he's been away from work so long that it's all he knows how to do anymore.

Also, contrary to what the renters on these forums would have you believe, the rent:property value ratio in this city is freakishly low, ie: rents are way too cheap here. Well, or property values are way too expensive but until we see large numbers of defaults I'd argue that one. So you won't make the money you think renting, and then it's DEFINITELY about the investment - and do you really think your property values are likely to double in, say, the next 10 years?

All in all, this is just about the last place I'd invest in rental properties. Low rent + low value increase for the forseeable future = bad investment. You have to love being a landlord (and I've known some that do).

Good to know, thanks for the advice.

[Surrealplaces]

You could always look at properties in the U.S. It's more paperwork, but from a financial aspect it's not bad. Prices are really good right now.
I have a property that I paid 250k for, and put 20% down on. The rent is breaking even with the mortgage. After I factor in a property manager ($120.00), taxes ($75.00) and insurance ($120.00), I'm subsidizing it by about $350.00 U.S. a month. I was looking up here but the dollars just didn't make sense at this time.

Also worth noting, the tenant/landlord laws favor the landlord much more than they do up here.

[YYCguys]

I'll be renting my Airdrie condo out in the fall when I make the move into Calgary, and because I am choosing to go with a Property Manager I will be subsidizing the place to the tune of $300 or so each month. BUT, I won't have the headaches of being a hands-on landlord. I would have liked to make a bit of money or at least break even but it seems I couldn't squeeze out more rent for my place than what is being suggested by the one Property Manager I've already contacted (she is the property manager for the condo corporation as well, so she knows the complex really well).

As I am still in the early stages of planning this rental, does anybody have any suggestions for property management companies that would do work in Airdrie? I would like to get a couple of more quotes before I decide who to go with for sure.

[glam]

My wife and I have been landlords for a little over four years now. We have a condo in Varisty and a house in Glamorgan that we rent out up and down (zoned R-2). We used to live in the main floor of the Glamorgan house but recently moved out prior to the arrival of our second child because we needed more space.

We've been fortunate that with some hard work and lots of luck, we've had great tenants over this span with only one exception. Looking back, probably the biggest thing that has helped was putting the extra time and effort into getting references from applicants, and really trying to guage their character from their past bosses, coaches, landlords, etc - this was especially important to me when we lived in the Glamorgan house and had people living below us, and just my wife and our baby home by themselves.

Secondly, the other thing that really helps is to be flexible and really respect your tenants and try to understand where they're coming from. You can't always be a hard ass because that will get you no where fast. Of course, there are plenty of times where you need to be firm, but you need to remember that over the long haul, these people are helping you pay for your property and so you need to treat them the way that you'd like to be treated and you need to be able to sweat the small stuff sometimes.

For instance, we've never gouged our tenants and have let a number of them break their leases early without any penalty because we wanted to help them out, like this young family from Romania that were able to buy their own house. I've got lots of other stories but I don't want to bore you. You just need to try and maintain a good and somewhat professional relationship.

Having a good, thorough contract is vital as well to protect your interests and also to set clear expectations up front. Check out the one from RentFaster.ca as a good starting point.

You'll need to have some margin to cover off on the ups and downs of the rental market. We've always had our suites rented except for one month when we had to rip out our bathroom and re-do it. It also helps if you're handy, or at least willing to try things yourself, as it will save you money - provided you can do it reasonably well.

It sure can be a lot of work, although it tends to come in fits and spurts, like say move-ins and outs and when major repairs need to occur. I've done my share of all-nighters just so that it could be ready for a new tenant. Nothing like scraping out an old used wax flange for a toilet at 3AM!

I hope that helps at least a little bit. Let me know if you have more specific questions.

[glam]

Originally Posted by Surrealplaces

You could always look at properties in the U.S. It's more paperwork, but from a financial aspect it's not bad. Prices are really good right now.
I have a property that I paid 250k for, and put 20% down on. The rent is breaking even with the mortgage. After I factor in a property manager ($120.00), taxes ($75.00) and insurance ($120.00), I'm subsidizing it by about $350.00 U.S. a month. I was looking up here but the dollars just didn't make sense at this time.

Also worth noting, the tenant/landlord laws favor the landlord much more than they do up here.

I've often looked hard and long at some of the prices in the States too, but haven't followed through because of the proximity factor and lack of time to spend on it. Good for you.

I completely agree with your statement about the AB Tenancy Act really favouring the tenants. As a landlord in AB, you don't really have a whole lot of teeth, other than the damage deposit, if you have a really troublesome tenant (i.e. severe damage to suite or delinquent rent, etc.) - unless you have bags of cash and can bother taking people to small claims court, etc. Which is why it's important to do your best to get good, personable people in and treat them well. People skills is definitely the biggest asset you can have.

[glam]

Originally Posted by freeweed

Also, contrary to what the renters on these forums would have you believe, the rent:property value ratio in this city is freakishly low, ie: rents are way too cheap here. Well, or property values are way too expensive but until we see large numbers of defaults I'd argue that one. So you won't make the money you think renting, and then it's DEFINITELY about the investment - and do you really think your property values are likely to double in, say, the next 10 years?

All in all, this is just about the last place I'd invest in rental properties. Low rent + low value increase for the forseeable future = bad investment. You have to love being a landlord (and I've known some that do).

It's true, buying Calgary property now, or even in the last couple years and trying to rent it out doesn't make a lot of sense at all.

[sauril]

For those of you who think that the AB landlord/tenant act favours tenants, I suggest you try renting a house anywhere else in Canada.

When I first moved here, I couldn't believe the hoops I had to jump through just to rent an apartment.

[Tarsus]

Originally Posted by glam

I've often looked hard and long at some of the prices in the States too, but haven't followed through because of the proximity factor and lack of time to spend on it. Good for you.

I completely agree with your statement about the AB Tenancy Act really favouring the tenants. As a landlord in AB, you don't really have a whole lot of teeth, other than the damage deposit, if you have a really troublesome tenant (i.e. severe damage to suite or delinquent rent, etc.) - unless you have bags of cash and can bother taking people to small claims court, etc. Which is why it's important to do your best to get good, personable people in and treat them well. People skills is definitely the biggest asset you can have.

I don't know where in the states, Surreal's property is located, but I can tell you that in Texas the laws are more favorable to the landlord than they are in Alberta.

[freeweed]

Landlord/tenant legislation MUST be heavily in favour of the tenants.

Think about it: if the landlord gets the bad end of the stick, they're out some money. Maybe substantial amounts, but still just money.

If the tenant gets screwed, THEY DO NOT HAVE A PLACE TO LIVE.

My opinion anyway. And I've known some pretty asshat tenants.

[glam]

Freeweed, you're right. This is the way it should be.