72

why does it make sense financially to buy property and become a landlord? Because then your investment generates cash instead of just sitting idle. All taxes, fees and repairs aside it would take almost 21 years before I start making profits. No - your profit will be the rents that you collect (minus expenses). You still have an asset that is worth ...


52

I believe it's not only legal, but correct and required. A 1099 is how a business reports payments to others, and they're required by the IRS to send them for payments of $600 or more (for miscalleneous payments like this). The payment is an expense to the landlord and income to you, and the 1099 is how that's documented (although note that if they don't ...


44

No. The starting point is what other rentals are going for in the area. Supply and demand dictates a fair starting price. From there, you can adjust up/down for the fact that you know this person. (To be clear, this is the answer, i.e. the renter should neither know nor care what your costs are, only what similar properties rent for.) (Note, there are ...


39

I disagree with the other respondents. If your tenant is an individual, renting in their individual capacity, there is no reason they need your SSN. They will not be sending a 1099 to you. If your tenant is a business, then your property is not a residential property. It is at least a "corporate housing", and you would have noticed that the contract was ...


34

The idea you present is not uncommon, many have tried it before. It would be a great step to find landlords in your area and talk to them about lessons learned. It might cost you a lunch or cup of coffee but it could be the best investment you make. rent it out for a small profit (hopefully make around 3 - 5k a year in profit) Given the median price of ...


32

The main work that a property management company does is finding you a tenant. After that, they may provide handyman services at a decent rate, but for the most part they'll just be making the same calls that you would make to a plumber/electrician,etc. on the occasions where something goes wrong. I'm a landlord and like to handle repairs myself, my sister ...


26

The value of getting into the landlord business -- or any other business -- depends on circumstances at the time. How much will it cost you to buy the property? How much can you reasonably expect to collect in rent? How easy or difficult is it to find a tenant? Etc. I owned a rental property for about ten years and I lost a bundle of money on it. Things ...


24

Traditionally in my leases I specify that it will be returned within 30 days of move-out via check (and therefore they must provide forwarding address). I send via certified mail so that receipt is confirmed. Safe and easy. Now, for tenants that pay with Zelle I will offer to return it via Zelle, but I don't have that written into the lease because it's ...


22

A lot of people do this. For example, in my area nice townhouses go for about $400K, so if you have $80,000 you can buy one and rent it. Here are the typical numbers: Monthly Payment 30-year loan at 4%: $2,027.73 (Includes Monthly Tax Paid: $416.67) Insurance: $80 per month Maintenance: $50 per month Rental Income: $2,500 per month So you would make $...


21

It is legal. They're probably going to give you a 1099-MISC, which is required of businesses for many cash payments over $600 in value to all sorts of counterparties. (Probably box 3 of 1099-MISC as is typical in "cash for keys" situations where one is paid to vacate early) A 1099-MISC is not necessarily pure income, but in this case, you do have money ...


18

I have been a landlord in Texas for just over 3 years now. I still feel like a novice, but I will give you the benefit of my experience. If you are relying on rental properties for current income versus a long term return you are going to have to do a good job at shopping for bargains to get monthly cash flow versus equity growth that is locked up in the ...


15

I did the long-distance landlord thing for a couple years and it was a disaster. Our first property management company skipped town with our deposit, and a lot of other clients' deposits as well. I never recovered the money. Then the next property management company completely mismanaged a situation, nearly escalating it to a legal issue where a simple, ...


15

It would appear that people have different experiences with the management companies, and that's to be expected. For what it's worth, in some areas of the world (Australia, probably others), it's basically expected that you run your rental property through a management agency, regardless of where you live. That's not to say that everyone does, but it's ...


12

This is a reasonable idea and many people have done it. But there are some risks that you need to mitigate. Overleverage. If mandatory payments are more than you can handle, you could lose your property. Think you get laid off during a recession when all your houses are empty. Managing property is a lot of work. A friend does this, but to keep 7 properties ...


11

The biggest question is do you want to be a landlord? There are a lot of ups and down to managing property from bad tenants to having to fix a water heater or replace a fridge. If you aren't interested in being a landlord, it is definitely a bad idea. If you do want to be a landlord, then the question is how close do you want to be to your tenants? ...


11

Confer with the landlord I am surprised at the amount of work this contract wants done. I'd question if it's even legal given the high costs. I suspect it's only there to remind abusive tenants of responsibilities they already have in law for extraordinary abuse beyond ordinary wear-and-tear: they are already on the hook to repaint if they trash the paint ...


11

with 150K € to invest to "become a landlord" you have several options: Pay for 100% of one property, and you then will make a significant percentage of the monthly rent as profit each month. That profit can be used to invest in other things, or to save to buy additional properties. At the end of the 21 years in your example, you can sell the flat for return ...


10

I'd suggest you run a credit check on the new tenant. If you reject based on this, they have little to argue as this is an objective number. It's no guarantee, but a high credit score says a lot. Edit - I added a chart in response to your last comment. You can be as choosy as you wish, the request for credit check is to weed out the potential disasters more ...


10

Edit: What is a reasonable and/or customary time frame to allow them to keep a guest? "Whats customary" - is relative to interpretation. So if you're just trying to be nice I'd say 10 days or two weeks is enough. In your state a guest at a lodge, motel, or hotel is defined as someone who stays for less then 31 days. "Permanent guest", any person who ...


10

IANAL, but here are the relevant Colorado laws: https://law.justia.com/codes/colorado/2016/title-38/tenants-and-landlords/article-12/part-1/section-38-12-103/ A landlord shall, within one month after the termination of a lease or surrender and acceptance of the premises, whichever occurs last, return to the tenant the full security deposit deposited with ...


9

There are a lot of things you can do to get a better tenant. This answer relates specifically for Sydney Australia. Regarding the Application Form: Name & contact details Employment details including length of work, name & contact details of HR manager Current and previous addresses and rents paid, and lengths of time at these addresses Landlord/...


9

Maybe you should consider setting up a Taxpayer Identification Number (TIN) for your business dealings as a landlord and consider providing that instead of your SSN for this type of thing. I am assuming (if this is legitimate) they want it so they can send you a 1099 as they might be obligated to do if they are claiming the rent as a business expense. Also, ...


9

TL;DR; In a perfect world that would work out, but we aren't in a perfect world. The main thing you are failing to consider in the question is risk. Major repairs: If you own the house, then you're stuck with the major repairs (heat/air, new roof, refreigerator, water heater, etc.) and you'll have a lot of those over the next 20 years. Vacancy: When you ...


9

Lets take this at face value for a second. Lets accept the fact that he gave you the wrong address to mail the checks, and the checks were stolen, and the checks were fraudulently cashed. Contact your bank, and ask them to help you contact the police. File a formal police report. Why? Because either the money was stolen, or the landlord is not telling the ...


8

Unless you are prepared to move out if your demands are not met, you might not have much bargaining power. If you have a lease with a fixed termination date, there may be a clause in there to the effect that unless a new lease (or renewal or an agreement to extend the current lease under its current rental rate) is signed by both parties n months before the ...


8

How is the end of tenancy going to be "decided" (notice, letter, how long before the end of the contract) ? If you leave on or before the last day of the fixed term, the tenancy ends at the end of the fixed term. You're not required to give notice, but it's generally appreciated if you do. If the landlord wants you to leave at the end of the fixed term, ...


8

No, the best you can do is (probably) determine the bank, from the sort code. using an online checker such as this one from the UK payments industry trade association. Revealing the name of an account holder is something the bank would typically require a warrant for, I'd expect, or whatever is covered in the account T&Cs under "we provide all lawfully ...


8

Not really. Imagine a house that was purchased 30 years ago or one that is paid off. The low/no mortgage has nothing to do with the rent. Your rent should be more about "fair market value". NOW, what you can coordinate is your rent vs how long your mortgage is. When I'm paying off my own house, I usually go for 15 years. For rental houses, I ...


7

It is very difficult in New York City to evict a tenant. The tenant-landlord laws require that the tenant be taken to housing court. The time between filing a case for eviction and having the case heard is often five to six months. During this time, the tenant is allowed to live in the rental property. Note that this situation is independent of any rent ...


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