Rental Property #9 Debrief

I got too much story and too much lesson to tell about this deal. I will only pick the best. I will write this debrief with a different format than the other one

Lesson number 1: Do not rush

This is a pretty huge 2000 square feet house with four bedrooms and 1 story I bought for my sister. I remembered bought it for 55,000$. I believe this is so far the cheapest house i ever purchased in term of price per square feet. It came with of course a lot of repair but mostly cosmetic. I have no time for due diligence since we have so many buyer want to purchase the house at the same time. I decided to bite the bullet and go into escrow with out a clear understanding of what needed to be done

Lesson number 2: If you think hire a professional is expensive. wait until you hire an amateur

Since the rehab is mostly cosmetic. and my newly hire property manager keep on advertising about his A to Z turn key process. I trust the guy, hand him the key and let him manage the rehab. Thing turned to be a disaster. Biggest mistake made so far in life. I will simply tell you this: he charged me $500 to replace a toilet. Instead of fire him immediately after i see the bill. I made another mistake and let him finished the job. It cost me near $30,000 for one of the shittiest rehab i ever done in my life. Lucky me since i bought the house for so cheap. The number still work out. I then fired the property manager, lease it out myself for $1250 a month.

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After (you can’t tell from the picture but the quality of the construction is bad)

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Lesson Number 3: bad rehab will lead to bad tenants

I had a hard time filling this house because i couldn’t attract any good tenants. The house sit on the market for a month and i finally select the best among the bad applicants. Bad decision! They pay rent on time. However, they bother the neighbor hood with loud music and party. and when they moved out. They turned the house into a cock roach infestation head quarter! It took me countless amount of effort to finally killed all the roaches in the house

I also take the change to fix the property back the right way. The house is now leased for $1250 to a good family as of $1250. I hope it will continue this way from now on

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