Real Estate Investing: tenants and projections
October 6, 2014
This month was mostly uneventful.
The rent came in late, which racked up a minimal late fee. Since I rely on the rent to cover the mortgage, I wondered if it’d be worth bumping up the late fee a bit to motivate the renters to pay on time more often. Perhaps on the next lease. Nothing punitive but something more annoying than the equivalent of a monetary flea bite.
They also managed to run afoul of the HOA so that was a fun bit of paperwork to get in the mail. It seemed to be a minor thing so as long as they toe the line, we should be fine there. This reminded me, of course, why I prefer to have the management company deal with the day to day: I just had to send off an email and ask for them to deal with it.
Just for kicks, I ran a projection of income and expenses for the rest of the year; I was curious to see what result we could expect after a partial year of rent with regard to cash flow.
Barring any interruptions of rent payment, assuming we retain the same renter this year, and any repair costs that might come up (most will be covered by the supplementary insurance): ~$300
Note: This excluded the actual cost of the purchase (the down payment, the fees and the closing costs) since I assume, for the moment, that will be recouped if and when I sell. Otherwise it’ll likely take about thirty years to break even by rent alone.
Whoever said this rental property thing was a sure moneymaker can bite me. 😉 But I wasn’t looking to get rich overnight – if there was a great way to do that I think we’d all be there – so patience is the name of this game.