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Retire and Become Landlord to Supplement Income? #4602589
12/13/17 02:39 PM
12/13/17 02:39 PM
Joined: Jul 2007
Posts: 4,266
Midwest USA
LoneRanger Offline OP
LoneRanger  Offline OP
Joined: Jul 2007
Posts: 4,266
Midwest USA
What do any forum rental property owners think about the idea of retiring in one's mid 50's and buying a few properties to rent and using the rental income to bring total income to near-parity with current pre-retirement salary? Rental income would be supplementing defined benefits plan distribution that is "fixed income" but gets cost of living adjustments and pays monthly until I go ten toes up some day. Health coverage for retirees our organization is only $50/mo, so that's covered. Would need about $25,000/yr tacked onto pension distribution to match current salary. Have 457b that can also provide money but I'm 54 and want to leave that alone until at least 59 1/2 on account of the tax penalty thing.

Already own one property that can be rented out once my son and his wife move out, small 1050 sq ft 2 br 2 bath condominium built in 2009 in a condo community with fiscally healthy condo assoc ($130/mo fee). Guessing it could rent for $900 - $1000/mo in local market but that's a raw estimate. The HOA fee takes care of all outside maintenance and repair such as roof, guttering, drainage, front landscape area (1 story bldg, 4 units per bldg). Prop taxes on it are $1500/yr. Paid $75K for it in 2015, no mortgage, clear deed. Thinking holding on to it and renting might be better than selling. Believe the municipal zoning allows rentals but need to check.

Guess I'm asking how much hassle it is vs. the income it provides.

Would be looking to buy a few additional small condo type units, built recent that have healthy condo assoc so you don't get hit with exterior repair and maintenance.

This all may be non-workable, or it might work out okay. Just thought I'd bounce it off any forum landlords.




'09 Subaru Forester ...................(QS HM 5W30)
'16 Moto Guzzi Stelvio 1200 .....(ENI i-Ride PG 10W60)
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602591
12/13/17 02:41 PM
12/13/17 02:41 PM
Joined: Jan 2008
Posts: 10,821
OH
SatinSilver Offline
SatinSilver  Offline
Joined: Jan 2008
Posts: 10,821
OH
Here's a thread from earlier today on it:

https://bobistheoilguy.com/forums/ubbthreads.php/topics/4602377/Rental_Property_Advice

My friend had 8 rentals and he's slowly selling the properties off. Too many headaches and coming from him that says a lot.

Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602593
12/13/17 02:46 PM
12/13/17 02:46 PM
Joined: Jul 2007
Posts: 4,266
Midwest USA
LoneRanger Offline OP
LoneRanger  Offline OP
Joined: Jul 2007
Posts: 4,266
Midwest USA
Thanks for the heads-up I'll check that out.



'09 Subaru Forester ...................(QS HM 5W30)
'16 Moto Guzzi Stelvio 1200 .....(ENI i-Ride PG 10W60)
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602623
12/13/17 03:18 PM
12/13/17 03:18 PM
Joined: Mar 2014
Posts: 3,322
NJ
Leo99 Offline
Leo99  Offline
Joined: Mar 2014
Posts: 3,322
NJ
It sounds good on paper...

Is good if you have good tenants.

Not so good if you don't.


Without data you're just another person with an opinion. W. E. Deming

2003 Corolla 250,000 miles
2004 Rav4 359,000 miles
2015 Camry 59,000 miles
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602630
12/13/17 03:24 PM
12/13/17 03:24 PM
Joined: Aug 2004
Posts: 1,475
San Antonio, Texas
sasilverbullet Offline
sasilverbullet  Offline
Joined: Aug 2004
Posts: 1,475
San Antonio, Texas
Agree with all above so far, also consider what happens if the properties are all vacant for a while.


03 Porsche 911 Liqui Moly Leichtlauf High Tech 5w-40 & Mahle filter
14 Honda Accord 4dr EX-L 4cyl-M1 0W-20 & WIX XP
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Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602634
12/13/17 03:28 PM
12/13/17 03:28 PM
Joined: Aug 2002
Posts: 14,456
Silicon Valley
PandaBear Offline
PandaBear  Offline
Joined: Aug 2002
Posts: 14,456
Silicon Valley
My dad does it.

You will have periods of months with nothing going on and then suddenly one summer everyone left and you have many units come in for remodeling. The work is hard if you want to DIY to save money. It is not a passive income but my parents like real estate and have been doing it as a profession for decades, and they are quite handy (amateur level in wood work, plumbing, yard work, painting, cement, appliance repair, eviction, electrical, dry wall, etc). The record they have is a period of no rest for 5 months, remodeling 3 apartments back to back. You also need to have a good line of credit or lots of cash reserve when things happen, like unforeseen remodeling (tenants damage something big, or unable to find a leak, leading to gutting a bathroom while tenants are staying in AirBnb).

Sometimes it is worth picking a good tenants, especially in area with rent control (you want to pick families that have stable income and the apartment is just slightly too small for them, so when they saved up they'll buy a home and leave).

When things are going well you have months of not having to do anything and money just roll in.


"You keep asking questions PandaBear and you'll end up a vegetarian like my wife" - Camu Mahubah
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602635
12/13/17 03:28 PM
12/13/17 03:28 PM
Joined: Aug 2011
Posts: 3,373
Chicago,IL,USA
pandus13 Offline
pandus13  Offline
Joined: Aug 2011
Posts: 3,373
Chicago,IL,USA
HOAs... (just talking from my posterior, but I hope it helps you):
-figure if they approve rent
-any additional taxes (HOA, City permit....)
-if rent spots are already full (10-20% max)
-how the owners will treat renters
-special assessments

Remember condos/apartments usually in a down-market will recover the last.

Now what works:
-like you said, fiscal-healthy HOA; find out all the major repairs made or to be made
-close to schools
-close to shopping/transport
-re-do nicely and also tenant-proof your property
-get friendly with the HOA maintenance crew; sometimes they moonlight...; whatever they do for you, will be silently approved by the HOA
-purchase price(mortgage monthly) + all fees(expenses: HOA, water,power,gas,...) + 10% management(backup) < monthly rent


16 Golf SportWagen
13 Mazda5
08 Yaris
04 Elantra
95 accent
95 mystique
97 concorde
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602638
12/13/17 03:32 PM
12/13/17 03:32 PM
Joined: Sep 2004
Posts: 21,742
Orlando, FL
Mr Nice Offline
Mr Nice  Offline
Joined: Sep 2004
Posts: 21,742
Orlando, FL
Originally Posted By: LoneRanger
Thanks for the heads-up I'll check that out.


Avoid the stress and aggravation of rental properties, its not as easy as some think it is.

Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602644
12/13/17 03:40 PM
12/13/17 03:40 PM
Joined: May 2002
Posts: 1,446
St. Charles County, Missouri
csandste Offline
csandste  Offline
Joined: May 2002
Posts: 1,446
St. Charles County, Missouri
I'm retired and have a rental house and a townhouse. I use two rental companies to keep tax computations separate. They each charge roughly 10% to obtain renters, serve as a contact point, handle light repairs, etc. IMO it's well worth the $90 or so bucks a month. I've never even met my tenants and I like it that way.


2017 Kia Soul Plus-- Valvoline MaxLife Blend 5-20, 48,000 miles.
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602655
12/13/17 03:54 PM
12/13/17 03:54 PM
Joined: Jun 2004
Posts: 2,409
St. Louis
MONKEYMAN Offline
MONKEYMAN  Offline
Joined: Jun 2004
Posts: 2,409
St. Louis
My brother just bought his second rental property. First one was a house. He said it took 800 hours to get it ready. Now, he is capable of doing just about anything and the type of person that has to keep busy. He retired in late 50's and went back to work in a less stressful job, plus doing the rental property thing. He has his son and son-in-law in area to help out. Bottom line sounds like a lot of work.


Truth alone triumphs, not untruth.

2017 Elantra SE
Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602659
12/13/17 04:03 PM
12/13/17 04:03 PM
Joined: Dec 2006
Posts: 2,790
Southeast Alabama
SrDriver Offline
SrDriver  Offline
Joined: Dec 2006
Posts: 2,790
Southeast Alabama
My father told me many times: "Whatever you do in life, don't get in the rental business!"

Re: Retire and Become Landlord to Supplement Income? [Re: LoneRanger] #4602660
12/13/17 04:04 PM
12/13/17 04:04 PM
Joined: Mar 2008
Posts: 5,873
South Florida
bubbatime Offline
bubbatime  Offline
Joined: Mar 2008
Posts: 5,873
South Florida
If you can hand pick your tenants, which might be against the federal Fair Housing Act, then you'll be OK.

I know a guy in the rental business, that ONLY rents to 60-70 year old retirees. No young folks, no "urban" looking baby mamas with 7 kids, and he has ZERO problems. Probably illegal if someone complains, but he has no headaches.


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Re: Retire and Become Landlord to Supplement Income? [Re: Mr Nice] #4602661
12/13/17 04:06 PM
12/13/17 04:06 PM
Joined: Aug 2011
Posts: 3,210
n.c.
gman2304 Offline
gman2304  Offline
Joined: Aug 2011
Posts: 3,210
n.c.
Originally Posted By: Mr Nice
Originally Posted By: LoneRanger
Thanks for the heads-up I'll check that out.


Avoid the stress and aggravation of rental properties, its not as easy as some think it is.
I'm down to one rental house and it's for sale.

Re: Retire and Become Landlord to Supplement Income? [Re: bubbatime] #4602662
12/13/17 04:06 PM
12/13/17 04:06 PM
Joined: Jan 2008
Posts: 10,821
OH
SatinSilver Offline
SatinSilver  Offline
Joined: Jan 2008
Posts: 10,821
OH
Sounds about right esp when they have SS checks rolling in and just want a roof over their heads.

Re: Retire and Become Landlord to Supplement Income? [Re: SatinSilver] #4602669
12/13/17 04:12 PM
12/13/17 04:12 PM
Joined: Aug 2011
Posts: 3,373
Chicago,IL,USA
pandus13 Offline
pandus13  Offline
Joined: Aug 2011
Posts: 3,373
Chicago,IL,USA
Re: older retirees
Originally Posted By: SatinSilver
Sounds about right esp when they have SS checks rolling in and just want a roof over their heads.

They usually also want less headaches, so:
-building with easy access (at least one entrance wheel-chair friendly) + elevator

Fair warning:
older people may forget stuff... including the stove they just started cooking breakfast/dinner.

have smoke/CO detectors in place and check for still being in their place and functioning properly.....

Last edited by pandus13; 12/13/17 04:19 PM. Reason: smoke detectors

16 Golf SportWagen
13 Mazda5
08 Yaris
04 Elantra
95 accent
95 mystique
97 concorde
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