| T O P I C R E V I E W |
| Alee |
Posted - Dec 18 2010 : 09:57:49 AM
Doug and I would like to buy around 40 acres and at first just build a duplex on it. We would rent out half and live in the other half. I want to make them as energy efficient as possible, using natural heat and light for most of the year. Then when we can afford to, we would have our "real" home built that would be somewhere on the same property but further away from the duplex. We could then rent out both sides of the duplex and since I am going to have a horse ranch, I was thinking one of the attractions is that I could offer pasture space to the people in the other duplex.
What do you think? My parents were apartment managers and hated it, but I think being the owners we could screen the people and living right next door would keep some of the silliness down.
We have about two and a half years before we make a decision to either build a regular house on a smaller parcel of land or buy bigger and build the duplex with the hopes of income to be had from the land immediately.
I was also thinking a bit down the road- but if my horse breeding operation becomes successful enough to the point where I would need to hire a barn manager, I could always offer the duplex for live in quarters.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
Put your pin on the farmgirl map! www.farmgirlmap.blogspot.com |
| 15 L A T E S T R E P L I E S (Newest First) |
| MagnoliaWhisper |
Posted - Mar 16 2011 : 12:20:37 PM
I don't have any experience at all in what I am about to suggest. But, I would be boarding animals would get you more, and better money. And you would have collateral if they didn't pay! (their animal!) What I would do if I was trying to make money with the property to help out, is do all the gardening and the like type stuff I could and then possibly either raise animals, (chickens and sell them, or breed dogs, etc) or board horses. Maybe even give horse back riding lessons. I don't know though cause I don't have any experience in it, just seems like a better bet then depending on a renter to pay rent and keep up the house.
http://www.heathersprairie.blogspot.com |
| SarahJ |
Posted - Mar 16 2011 : 06:39:49 AM
I would not do it either. Unless you won the renter lottery, most renters can quickly depreciate the value of any home, even if they are semi-good renters. I've lived in two historic parts of town, and after most of the older people died, their children turned their beautiful historic homes into rentals. While some managed to maintain some semblance of quality, most of the homes have deteriorated. All it takes is one really bad surprise renter to put you in a financial bind.
If I were going to build,using my hard-earned investments, I would build for me.
SarahJ
Farmgirl Sister #116
http://bayoumama.wordpress.com/ |
| gspringman |
Posted - Mar 15 2011 : 9:00:29 PM
I would never again have renters. Most feel they don't owe you to keep your house up and they usually will skip out on rent due when they want to move on. Always leaving you with more repairs and expense than you realize. Then there is always taking them to court and filing all the right paperwork from start to finish. I hated trying to collect rent when it was past due.
Good luck to you if this is the route you decide to go. I think I'd rent it to your manager in exchange for part of his wages, personally. Just my opinion.
Gail
Farmgirl #486
http://grammasladybug.blogspot.com/ |
| Lady Woodworker |
Posted - Mar 15 2011 : 3:54:02 PM
These horror stories are so horrible that I'm actually finding myself snorting with laughter...I'm SORRY!
You poor people! Decent citizens trying to help others and this is the thanks you get?
Yikes!
My ex-boyfriend had horror stories too. He was taken by surprise about tenants' rights and was skinned financially for years.
My husband and I have rented out our home (for one and two-weeks at a time) in high summer (when many people want to be on the Maine coast). Most of our renters have been fine but some have been terrible--even though all were checked out beforehand.
The one person I know who has had great luck, works without a lease or a contract of any kind. He's fair and he's a good landlord but if things don't work out or the rent doesn't come---out they go! And there's nothing they can do.
I guess I would rent my house again but that's a short-term thing.
I would not be a full-time landlord but your situation and outlook may be very different and it may work fine for you. Clearly, it works for many people or there wouldn't be so many rentals in the world.
Good luck in the journey,
Karen
Farmgirl Sister # 2419 |
| MagnoliaWhisper |
Posted - Mar 15 2011 : 1:56:41 PM
I personally wouldn't do it either.
My grandmother owned 10 houses all on our same block. She lived right next door to 2, one was also behind her and 3 others directly across the street from her! Yet, still it was difficult to keep out the rubbish!
First of all, old landlords will give them good reccomendations to get rid of them!
Another is the laws really protect them, if some one say moves in in say.....September and don't pay rent for october or EVER again, you can't legally in a lot of states kick them out till March if they have any children under 5! And yes the courts may say they have to pay rent, but......actually seeing the money is another thing. Yet you still have house payments, and insurance, and taxes to pay on said house! Not to mention the damage they do. If they do pay rent you can't legally just walk in any time you want and you would be surprised at the upstanding looking people the amount of damage they can do is out of this world!
Personally I HATED it and grandma never even broke even, in fact she's been dead for over 14 years and we're still paying crap off, and trying to get things above water with those stupid rentals. I personally wish they would all burn to the ground, which one renter actually did do to one of the houses! Yeah......that was a person who even went to church with us! Who knew she was on drugs and freebasing on the couch, and caught the couch on fire and then let the fire just blaze and the house burn down! UHG!
I would NEVER do it, people could have a gun to my head to do it and I would say shoot me! lol And I'm not even kidding! lol
http://www.heathersprairie.blogspot.com |
| KD Earthwork |
Posted - Dec 26 2010 : 8:24:27 PM
Alee,
I think it's a good idea. But after building three houses, the last one the only one that stayed in budget...Raw land is incredibly expensive to develop.Septic, power, water, phone , driveways can eat up a large chunk of change. If you can find something that suits with a building on it, that maybe needs work, I think it's a lot cheaper. The one we live in now , on forty acres, off grid, horses, chickens, gardens. We never could have done it without my husband's heavy equipment experience and owning some pieces and my really good managerial skills.Even then it cost so very much money, we would never get it all back if we had to sell .We just got lucky and fate seemed to be with us at that point, so we now have just a small mortgage. It is also our retirement plan and we are working hard at developing a strategy to make money from the land.
We have a lot of zoning restrictions where we live and jumping through the permitting hoops is difficult and also can be expensive. The style house I've found to be the cheapest to build is a large box, gable roof, a second story but with a low plate height(12') so the engineering of a second floor is minimized.Dormers help to get extra ceiling height.A wood stove set in the bottom floor, not too close to the stairs heats both floors.Utilize all the space and don't do any high ceilings(huge waste of space and expensive).Standard framing ,you can use green insulation, and wood for the rest, is really green. We milled most of the wood for our project and this saved us a lot. Especially because my husband cut the trees we had on our land and moved them to the mill himself.
Good luck, Katie http://www.rosemancreekranch.com |
| Alee |
Posted - Dec 19 2010 : 09:52:41 AM
Amanda- that is good to consider as well. I would wasn't thinking about insurance costs- just that I would want to have property damage or something type of insurance so if the renters cost us $$$$$$ to repair something it wouldn't be all on our shoulders per se. I'll need to get some quotes from our county tax assesor and insurance before we jump in.
I knew you ladies would be an awesome sounding board. :)
I was also trying to think of the most efficient use of space that I could for a rental. I was thinking that as you walk in the door, you could immediatly go right up stairs or turn and go into the living room/ dining room/ kitchen Greatroom. I am thinking of somehow putting the washer and Dryer in the "under the stairs" part with the narrowing part being built in cupboards and a half bath off the kitchen. Then I was thinking of having 2-3 bedrooms upstairs with one of the rooms having a "master" bath and then having a open access bathroom in the hallway so that people wouldn't need to feel awkward in walking through a bedroom to get to a bathroom.
I'm not sure though.
Another idea is having the laundry room off the kitchen and taking some space away from the living room for a full bathroom downstairs- having the shower and toilet in line in what would have been the living room and the sink under the highest portion of under the stais. So the sink and cupboard would effectively look like they were set back in the wall and then there would be some built in storage in the bathroom. Then upstairs the space saved from having the full "public" bath upstairs could go to making a third small bedroom.
What do you think? I know we want to have at least 2 full bathrooms.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
Put your pin on the farmgirl map! www.farmgirlmap.blogspot.com |
| msdoolittle |
Posted - Dec 19 2010 : 09:36:09 AM
Yep, we are lucky in that our property and school taxes add up to about 100 extra per month here. Of course, we have several exemptions (agricultural and homestead exemptions), too. That's something to definitely bear in mind. And insurance costs, too! Our insurance for this house runs about 170 per month!
FarmGirl #1390
www.mylittlecountry.wordpress.com |
| Alee |
Posted - Dec 18 2010 : 9:21:03 PM
Susan- you make a good point about taxes. Montana is HORRIBLE about taxes. We have no sales tax which is nice, but since we aren't a huge consumer household, the offset of the higher property taxes doesn't really wash out in our favor.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
Put your pin on the farmgirl map! www.farmgirlmap.blogspot.com |
| Cindy Lou |
Posted - Dec 18 2010 : 7:54:21 PM
Alee,
YOu have time to check on local or county zoning before investing. There can be rules in some areas the limit the number of dwellings on a piece of property or other rules on housing. If its rural enough for horses you may not have to worry about city regulations. Check on property taxes, that could really add up in some areas with land, home and rental property.
Anything a person does has some risk but there are a lot of positives to your plan.
Good luck on your decision.
Susan
"Tell me, what is it you plan to do with your one wild and precious life?"
Mary Oliver |
| nubidane |
Posted - Dec 18 2010 : 6:36:05 PM
Alee,
If you can hand pick your renters, it could be a good thing..But..(sorry there is always that but)
Fair housing laws limit your ability to pick & choose, & I have several friends that have had horror stories as far as rentals go.
One even had a renter pour concrete down all the plumbing when they were given an eviction notice! (yes, I am an appraiser, & I have been in plenty of unsavory houses gone bad)
If you could live in one side, & with out advertising, pick your renter, that would be ideal!
On the flip side, I have a friend that does mortgages & owns rentals, & she has some ideal renters... One rents a 1960 singlewide for $400 a month & he has never missed or been late on a payment. He has paid for that single wide several times over!
Please be sure to familiarize yourself with fair housing laws.
There are some that are actually "plants" that will ask all the questions & try to bait you into a bad situation.
Although in a rural setting, that is more unlikely.
You have the time, just cover all your bases... |
| Alee |
Posted - Dec 18 2010 : 5:42:30 PM
I appreciate all opinions! We have a sizeable investment that will mature in about 2.5 years so we are trying to get the best value for the money my husband slaved 5 years to earn. I think there must be some sort of landlord's insurance that we would have to get and we of course would require a deposit that would be put into a CD or something so hopefully we would always have money on hand should any major repairs be needed when a tenant moved out. I also know all my landlords put a provision in that with 24 hour notice they can come in for maintenance etc. I think if we did decide to do that we would make it a habit to do quarterly inspections for maintenance and also to make sure the property was being respected.
We haven't decided yet, but right now we are paying $700 in rent. Assuming we can build for right around $200,000 Then we are looking at only a mortgage of $400-500 a month. So right off the bat we are keeping an extra $200 in our pocket each month and hopefully renting out for about $600-$700 a month for the other half which would of course be amazing. Also if we have property then I won't have to board my horse which will save almost $300 so all told we will be making $1100-$1200 a month just off one rental. We would be thrilled.
If that goes well and we could hopefully find a long-term renter with good manners then we could hopefully invest in the "big house" where we would finally not share walls with anyone. We would also be needing to build a barn somewhere in all this as well.
Alee
Farmgirl Sister #8
www.farmgirlalee.blogspot.com
www.allergyjourneys.blogspot.com
Put your pin on the farmgirl map! www.farmgirlmap.blogspot.com |
| msdoolittle |
Posted - Dec 18 2010 : 3:40:12 PM
I personally couldn't/wouldn't do it...you never know how people really are. We had neighbors when we were in town. Clean looking people, kept clean cars, clean yard, etc. Sure, they were a little loud from time to time...whatever. When they moved out, we bought the house (because we didn't want next door neighbors!!!) and we were SHOCKED to find that the carpets were soaked in dog urine and Carpet Fresh (so badly that my husband gagged), and the house was absolutely infested with RATS and roaches and the bathroom looked like a mold farm. You just never know.
I would rather wait and save until I was debt free and had saved up a substantial down payment, or either move a small house (like a kit house) onto the land. Like a little cabin. That's just me...I really do like people, just not living right next door to me! :0)
Plus, if you did have to evict them, they could totally trash the place and you do have to give them so many days to leave. I dunno. Sounds like a headache to me. Sorry for being little Miss Nancy Negative! :0)
FarmGirl #1390
www.mylittlecountry.wordpress.com |
| gramadinah |
Posted - Dec 18 2010 : 10:10:38 AM
Sound idea but you still have to keep on top of the renters. My rental is right next door and when they moved out or shall I say snuck out there was 4 large dump truck loads of trash in the basement. It took 6 weeks and $10000.00 to get it back in shape. I was in the house just about every week and never even thought about the unfinished basement as they said they were not using it. Tenants also have all the law on there side. Landlords are left in the dust.
Diana
Farmgirl Sister #273 |
| Libbie |
Posted - Dec 18 2010 : 10:07:29 AM
Alee - I think the duplex sounds like a really sound idea. We live on several acres, but we also have three rental homes that we own/manage and they are wonderful. Right now, they are just paying the mortgages - no income yet - but for retirement purposes, they *should* be paid off by then. It seems that you are thinking very clearly about this all, and, if you decide that your horse breeding operation may not take all of the land, or you need further income later, you will also have the option to subdivide the acreage, too.
Isn't it fun to think of options for our lives? I am so proud of you and what you've accomplished in the last few years. I remember when you were expecting Nora, and how fun that was to "experience" from afar, and then your move... you're doing GREAT!!!
XOXO, Libbie
"Farmgirl Sister #10," and proud of it!!! |
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