There’s been a double-whammy on the real estate front since last Thursday. First, I might need to evict a tenant at BD (the 6-unit) who has only been there since June. Thankfully I was smart enough to put up the 3-day notice to evict when she didn’t email, text, or respond to my phone message. I’m hoping she will leave quietly and cleanly by Wednesday so I can get the unit back on the market ASAP. I’m not looking forward to the process, but I feel confident that I can get the unit rented out within a couple months. If she doesn’t leave, I’ll need to file the eviction. She may not have to leave until January sometime. The most frustrating part for me is that her automatic ACH withdrawals for her monthly rent were coming out on or near the last day of the month. So, she’s already had November for free. It was my choice to set up the payments this way (I’d rather collect money that is there than money that is not), but, in this situation, it puts that process a month behind. Thankfully I know better than to spend the checking account down, so this is a minor set-back, not a major “we can’t pay the mortgage” problem, but it is still inconvenient and counter-productive.
In other news, I have been selling the duplex that was our first rental property via a land contract. It is in a rough neighborhood that failed to improve as I had anticipated, so I’m happy to be getting rid of it. However, I didn’t get a payment last month and the purchaser said I could add an extra $150/month until she is caught up again. I just received a phone message from her this morning reporting that the payment (ACH withdrawal) isn’t going to be there this month and that she might leave if things with her family-member roommate don’t change soon. The ACH withdrawal is in process, so I’m not sure if it will be funded or fail at this point. I also don’t know what I’ll do if she decides to leave. The math just doesn’t work out on this property very well because the rent is so low, which attracts a certain tenant, which in turn causes a lot of maintenance issues. The city has been tearing down a lot of the houses on the block, so maybe an investor will see an opportunity. I don’t know.
I completely understand how real estate investors get themselves into trouble. If we had a mortgage on one or the other of these properties, and we took an unexpected $1,200 hit to our rent collection in one month, we would struggle to get that mortgage paid, which can fairly quickly lead to foreclosure. Also, if we were relying solely on rental income, and not employment, this could also be a devastating month. So, while it may feel like our “empire” is crumbling around me, I’m probably being a little over-dramatic. Ultimately, this is only a minor setback in the grand scheme of things. And I’m thankful I’m not the one who is out looking for a new place to live.