As I suspected the old cast iron pipe had rotted out underneath the basement floor of my rental unit. My buddy Paul (who has his own plumbing company) stopped by to take a look, and after a few swings of the sledge hammer, found the bottom of an elbow joint completely corroded out to the point where the high flow rate from the spin cycle of the washing machine was forcing water out from under the foundation and back through the stone wall of the basement.

I told him to go ahead and fix the problem, as it …

Spurred by my recent plumbing problems, MJ wrote an excellent post on his blog concerning dealing with contractors, getting quotes, and following up on progress.

Anyone who’s never worked with contractors before will learn a thing or two based on MJ’s experience as a manufacturing engineer.

…any actual contractor should be able to cover all the costs of the work until it is complete, if it is a big project expect to pay 75% of the project costs when the work is 75% of the way done. In other words, the project should be close to finish at that point, and hold the last 25% for …

Read more…

So I made the handyman trip to my rental unit last evening after the tenant called and told me that the washer was spewing water all over the place.

A few things crossed my mind when she described what was happening:

The outflow tubing came out of the drain fitting and when the spin cycle started the water ended up on the floor instead of in the drain.
The outflow tubing disconnected itself from the pump.
The drain backed up and when the washer tried to pump all that water down the drain, it back flowed out the pipe.
The water pump case cracked and is leaking from inside the washer.

Any one of …

I just received a call from one of the tenants at my first rental property. The clothes washer is leaking all over the basement floor.

Just last night I was thinking about how I hadn’t been called to fix anything lately…

Go figure.

So tomorrow I play appliance repair man.

It’s interesting to note that of all the appliances I have bought brand new, I have not had to fix, repair or replace anything. However, initially I bought both the washer and dryer used. I replaced the dryer with a new $200 version from Home Depot less than 60 days after the used dryer was purchased (the warranty was only 30 …

After my visit to the termite palace yesterday, the real estate agent told me she’d keep an eye open for more property in the area. The question then became: What is your criteria?

My first rental property ended up setting the bar very high. I bought it from a bank, put less than $10,000 into it for rehab and renovation, and rent it to students. Overall, my net cash flow is $345 per month. So I guess those traits could start the list.

1. The property must be within 3 blocks North of the local University.

Talk about narrowing the field! This is probably …

This afternoon I went over an looked at the property I’ve been watching for a few months. From the outside looking in, it appeared to be a rehab project that simply ran out of money. It’s typically opportunities like this that widen the margin on a deal, as most of the expensive stuff has already been taken care of by someone else.

Walking in through the front door, it was evident that the place had been lived in since the renovations took place. The carpet was dirty and stained, and there were remnants of belongings (crayons, broken pencils, etc) left in the kitchen drawers.

The walls in the …

I called my banker yesterday after I started thinking about how I was going to finance another rental property. When I call this guy my banker, he IS the bank, as in, he OWNS the bank. A good guy to know, indeed!
One of the benefits to doing business with a small town bank is that you know the bank and they know you. There is no pre-approval as long as your logic is sound and the margin is wide. If you have the cash flow to support the investment, they’ll lend you the money.
So the …

I’ve been casually looking for another rental property next to the one I already own. For a long time, the people in the area have been very proud of their houses, asking nearly 5 times what they’re actually worth. Needless to say, those houses are still on the market, many for as long as 15 months and counting.
But there is one property just a block or two away from my first one that has been on the market for 4 months, and its price has been dropping like a rock. The reason? The bank wants out!
I remember …

Now that I have things on cruise control with my rental house, it’s time to start putting some money into it.

Last week I contracted out a tree service to have the tree removed on the property line. I generally hate to remove good trees, but this one is right on the property line growing up through a chain link fence, and even worse, it was growing up through the electrical service lines to the house. That spells disaster when the limbs freeze up and take out the power to the house.

While they were at it, they ground out a second stump in the middle of the back yard.

All …

It is now June 13th, and I have yet to receive rent for June, due on the 1st.

This will be the first time I have ever had a problem collecting rent from these tenants, and I think I know why.

Postage.

Back in the middle of May, postage went from $0.39 to $0.41 per stamp. Throw a thirty-nine cent stamp on an envelope, and you’ll probably see your mail back in your own box within a couple weeks.

After a phone call to the tenants, they indicated they mailed the check two days before it was due. I asked whether they put the correct postage …