Growing Money

I have a rental property located in Philadelphia, PA. It is a rowhouse, 2 stories high, and has a basement. My previous tenants were really good and hardly bothered me. Unfortunately, they moved out during the summer of 2007.

I had new tenants in September 2007, after going through much trouble. I had to hire a real estate agent to find tenants, after lackluster results of trying to do it myself.

My current tenants pay rent every month, but they barely make it by the due date. They have on occassion miss the due date but I have excused them, hoping they would send the next rent payments out earlier in return. They never did.

Recently, my current tenants had been calling me often and reported several issues. There were problems with the house.

Issues:
1. The toilet tank was overflowing nonstop and they had to switch off the water and only switch it on temporarily whenever they use the toilet. The toilet tank needed to be replaced.
2. The front door did not close properly. The door may need to be replaced.
3. The sink pipes in the kitchen were leaking.
4. The sink pipes in the basement were leaking.
5. The pipe connecting to shower head was broken and needed to be fixed.
6. The pressure on the hot water pipes were weak.

I hired a repairman from Philly, referred by a friend to fix all the issues in the house. Since the repairman lives in Philly, we communicated by phone and I mailed him a check.The total bill came out to $930. He was able to fix all the problems.

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In October, my tenants called me up for an issue that were having in the house. They told me that the heater was not generating any heat. Since I live two hours away from Philadelphia, it would be inconvenient for me to look at the problem. Plus, I have no experience in fixing heaters.

I called up my friend, who owns two houses in Philadelphia. He gave me his contact who does repairs. The contractor was able to look at the problem and fixed it on the same day. My tenants were very satisfied and called to thank me.

The repair job cost $250. The handyman responded fast and fixed the heater in less than an hour. I was pretty satisfied, considering that all I had to do was make a phone call.

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My previous tenants had left at the end of July this summer. They had been renting from me for almost 2 years. I was hoping they would stay longer, but the husband had to relocate for his work. They were good tenants and did not give me any issues.

Instead of hiring a real estate agent, I thought I could find new tenants myself. I posted up an ad on Craigslist and the web for my rental property. I received a lot of emails indicating that they are interested in seeing the place. I did some preliminary screening over the phone.

Since Philly was two hours away from New York City, I had to schedule a day for my trip. I went there on a weekend. Two prospects were supposed to show up to see the house. Unfortunately, I waited for five hours and nobody showed up. I called them and one of them told me her car tires broke. The other one didn’t answer the phone. I couldn’t believe how bad these prospects were.

I went home that day very disappointed. I knew it wasn’t so easy to find tenants, despite having so many people interested in the house. Eventually I gave up and called my real estate agent. I told him I was looking for tenants and let him do all the dirty work. In return, he would receive a month’s rent for finding me tenants.

A month later, in September, he found me a tenant with decent credit history. The tenant’s occupation is a mechanic. He collected the security deposit and first month rent for me, deducted his fees and mailed me a check.

The monthly rent for my property is now $900, compared to $950 from my previous tenants. Hopefully these tenants are good and wouldn’t bother me much.

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I made a trip to Philadelphia last Saturday (7/28/07) and went to look at my house. My tenants have completely vacated the area, so I inspected the house for any damages. I checked the rooms, the doors, lights, closets, cabinets, etc to make sure they were in good working order. I did not see anything in particular that needs to be repaired.

I also had two appointments for prospects that wanted to see the house. One was for 3:00pm and one was for 6:30pm. I waited until 6:00pm for the first prospect and called her several times. She finally answered the phone at 5:30pm and with an attitude, told me that her car broke down. The second prospect did not return my calls during the whole day. It was very frustrating to deal with people who do not have any responsibility. I definitely did not want them as tenants.

I left my house at 6:00pm and went to downtown Philly. I spent some time walking around and thinking about the Philly rental investment. Is it worth it to own a house in Philadelphia? The local economy in Philly is weak and there has not been much appreciation, if any, in my house.

Do you own a house in Philly? What do you think of the property appreciation potential in the short term?

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Since my tenants are moving out at the end of July, my house will be available for renting on August 1. I have posted up an ad for my house on Craigslist for rent and have received many inquiries. All of them ask to see the house. I screen the prospects over the phone carefully. Unfortunately, my tenants still live in the house, therefore, it is inconvenient for me to show the house to everyone. My tenants have shown the house to one person so far and she really liked the place and said that she is willing to move in. The prospective tenant has two kids and a stable income and is planning to live in the place for the long term. She seems like a good tenants, but I will do a credit check on her.

Characteristics of my ideal tenants:
1. Always pays rent on time (by the 1st of the month)
2. Maintains the house in a good condition
3. Does not bother me for small issues
4. Plans to rent for long term

I have to find a website that will process background/credit checks for me. if you know of any good sites, please let me know. Also, if you have a house in Philadelphia and are looking for a new tenant, let me know. I have several good prospects who are looking for a house but since I only have one house I can only fill one.

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My current tenants are moving out at the end of July. They have lived in my house for more than a year and have always paid their rent on them. They have been good tenants, never bothered me. I would love to keep them but they are moving back closer home.

I am planning on making a trip to Philly on July 21st. I will be meeting my tenants for the first, but I will need to be there in person to handle several issues:

1. Inspect the house
2. Return security Deposit to tenants
3. Collect the house keys

Now, I need to look for new tenants.

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