Ok, time to start telling the stories...
We HAD 5 rentals. Started selling about a year ago...I wanted to keep it quiet until mostly done. I'll post separately about each house...but first let me explain why we sold....this is the background!
We had 5 rental units for about the past 13 years. Bought them over the course of 2.5 years...paid cash for all of them. I got into rentals for a few reasons, but the main one was to diversify our investments away from the stock market, as I worked as an executive at a Fortune 500 company and most of our savings was in a 401k in stocks. My goal was to have a certain percentage of our investments in real estate...and the 5 rentals got us there.
I managed them, and I did 80% of the work. Some things I hired, such as roofing, vinyl siding, major electrical (I can do basics like adding switches and outlets, but rewiring a whole house is beyond me), major plumbing (again, I can replace a sink/trap/faucet, etc...but when I remodel I put all NEW stuff in, like replacing cast iron drain pipes with modern PVC, etc.), and so on.
I did things like paint, flooring, door handles, adjusting doors so they open and close well, trim carpentry (my specialty...I have a woodshop in my basement and can do almost anything with wood...as a matter of fact I made most of my own trim like baseboards), replacing doors, minor electrical, water heater replacements, HVAC duct repairs, basic plumbing, chimney repairs, window repairs, minor concrete work/masonry, drywall, and so on.
I retired from the executive job and became a home inspector just as we started buying the rentals. This worked great, as I could look at a house for 20 minutes and inspect the key things like breaker panel/wiring, attic condition for mold/insulation, roof/shingle/chimney condition, crawlspace issues, and understand the conditions of furnaces/water heaters/appliances, etc. I would then make a cash offer with no inspections, and this allowed us to offer about 5% below the asking prices and get the houses against bids that were higher but involved financing and inspections. We were able to close on a house within about 8-9 days.
Life was good...we'd get a house that was "outdated" in terms of both appearance and mechanically (old plumbing pipes, old ungrounded wiring, old windows, old trim, old cabinets, etc.) and I was able to do most of the work...we'd completely rewire the houses (Licensed electrician would bring in more power from the power company..we'd upgrade from 60A fuse panel to 200A breaker panel...but I'd save money by mounting and wiring all the outlets and switches), replumb and go to all PVC and PEX for plumbing (again with me doing the sinks/faucets but the licensed plumbers doing all the stub ins, shower installs, etc.), install vinyl siding on one house (others were brick or stone), and so on.
I did things differently than what many on here teach...I put most of the money into the things the tenants can't easily damage...the wiring, roof, chimney, smoke alarms, floor joists/structure, ceiling fans, plumbing in crawlspace/walls, attic ventilation, and so on. I spent precious little on appliances, sinks/faucets, I didn't do entire room painting...instead I'd touch up bad areas, would not do drywall repairs unless absolutely necessary, make my own wood baseboards for pennies per foot, and so on. I never did any landscaping/flowers, etc.
My goal in doing it this way was to minimize service calls, as I wanted the freedom of not having people call with things broken on a holiday in the middle of dinner. It was successful, as I averaged 1.2 unscheduled service calls per year....my phone almost never rang! Our houses were not always freshly painted with brand new flooring, but they rarely broke.
As a result of paying cash and having almost no repairs needed (except at move out), our cash flow was excellent. About 72% of the rent was pure profit.
Our houses ranged from an 825 sqft 2 BR 1 bath with a detached garage renting for (recently) $810/mo up to a 1,270 sqft 3 BR, 2 BA, large carport with full basement house that rented for $1,270/mo. We also charged for animals...these were the base rents...and we had LOTS of tenants with animals....so most rents were $50-$100 higher than those rents. Our house ages ranged from 1948 to 1964.
But due to a variety of factors...
1) I'm getting old and don't want to (or can't) work on them anymore....I injured my knee earlier this year and have an upcoming knee surgery.
2) Wife is concerned that if I passed away young (no, I'm not terminally ill lol) that she'd have to deal with all the complexities of liquidating the business
3) RE values are way up here, great time to sell
4) Tenants moving out...regular turnover, good time to sell
5) We are considering moving to another state with better weather
we decided to slowly unwind the business. We sold one unit in late 2021, 2 units so far this year, one more pending and should close within a month, and then we plan to sell the last unit in early 2023.
Ok, so that's the background. Later or tomorrow I'll begin new posts with a "story" about each of the houses.
It's been interesting being a landlord, some parts of it fun, some parts frustrating. But it's time for us to leave this to others and move on. I really enjoy this forum and learning from all of you...I get a lot of laughs and do a lot of head shaking.
That's it for now!