I think even driving Uber or Lyft would be safer than day trading. I agree–be sure you know what housing codes would apply and what required renovations would cost. In CA, lots of earthquake retrofitting and ADA remodeling can be expensive.
Daytrading is safe if one (a) only uses the money that she can afford to lose and (b) does not trade on margin and © NEVER sells stocks short. Oh… and unless you are a derivatives pro, stay away from options.
I’m not a LL in Pa., nor am I a LL of multiple units. All my units are single family homes, but for 2 that are duplexes. Been a LL nearly 25 yrs. People dream of LL sitting in rocking chair counting his money. Not so.
I am not informed enough to give intelligent advice to you, but I can tell you I know a lot of people that used to be in the LL biz.
My brother has a four unit, and I help him with the bill paying and paperwork. No management company. The cash flow on his unit is fair, at best. Major repairs come out of his personal funds. It’s definitely a strain when a unit goes unoccupied for some time. The four unit is his retirement plan.
When things are going well? Wow! This isn’t so bad!
When things go south? It takes up so much time, plus mental & emotional energy. And, boy, the timing is almost always BAD.
One incident was a backed-up toilet that overflowed. It not only damaged the unit where it happened, but damaged the unit just below. It was such a pain dealing with the unhappy tenants, the contractors, the city (inspections). It’s not something you can just wrap up tidily and be done with it.
Every year, snow removal is an issue. The snow cannot be removed if the tenants don’t shift their cars around. Almost always results in phone calls to my brother, who in turn, gets frustrated and short with his tenants.
Last month, one of the tenants rent checks bounced, which means we short-payed the mortgage. Phone call from the bank. Phone call to tenant. Another phone call to the bank. Another phone call to the tenant. A trip to the building to pick up a money order. A trip to the bank to deposit the money order. All in all, it’s not like it took that many hours to correct, but you feel as if your life is on hold until you get the problem resolved.
Then, there’s the chapter, “When Tenants Don’t Get Along”. Hoo boy.
Good luck in your decision!
@Midwest67 just reading your post dredged up everything I hated about my childhood (my parents owned rental properties). Some people handle those rental property crises better than others! I didn’t inherit that gene. What you described hurt my teeth! Good lick to your brother.
I’m not making this up! One of the tenants in my brother’s building passed away this week in his apartment. RIP!
Luckily, the body was not there long. Also luckily, one of the other tenants had the phone number of his adult daughter and although she is out of state, she is making arrangements for his belongings to be moved to a storage unit.
Yes, we had a tenant who died in an apt–owed a year’s worth of unpaid rent as well. That was the last straw and got us to switch to our current property manager. The prior company was terrible!
^We’ve had at least 3 tenants die in their units - one was there for 3 days. The smell was atrocious. And hard to eradicate. Numerous others have gone to the hospital and never returned.
We rented a house out for a few years to my in-laws, who were very good tenants. But the plowing, shoveling and routine maintenance were enough to convince us that we did not want to be in that business. When they moved, we could not sell the place fast enough.
I will pass along something our financial planner told us years ago: For most people, real estate isn’t a very good investment. Buy the place you want to live in (or vacation in), but do something else to earn your living.
@SincererLove, if there are not a lot of jobs in your town, and if companies are laying off, I’d be concerned about finding tenants to fill those apartments.
DH is in commercial real estate. His late mentor told him “I never buy anything where people sleep or eat.”
Commercial real estate has been very profitable for us. But DH knows what he is doing-he put these deals together for other people for many years until he had made enough money to start investing our own money in it. It’s not easy for the average Joe to make really good money in real estate without a very good broker or a trusted friend/relative with experience to guide you.
I posted early on in this thread and the last few days it’s been eating at me that I never gave the OP the advice I should have, so I’m glad to see the thread get new activity.
I’ve done very well with apartments but I wouldn’t buy them under today’s economic conditions. That’s because the reason to buy apartments is twofold, income and appreciation and, by any metric, the prospects for either are at historical lows.
The prolonged low interest rate environment we’re in has driven prices high and yields low. Only two things will drive values higher from here, inflation and a lowering of interest rates, neither of which seems likely. Conversely, a significant uptick in interest rates would cause apartment values to plummet.