Show021: One Thing Most Landlords Will Face..A Vacant Unit

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Join Emily on this take 10 show as she shares some insight into the realities of owning rental property.  Using a property she and her husband own, Emily shares how they have dealt with a vacant unit, why they decided to drop the price and enlist the help of their real estate agent.

The reality of owning rental property has its definite good days and not so great days.  While it is great to own properties with great tenants and earn 'passive income' each month, there are times when properties will not have tenants, when water pipes will bust or you have to evict a tenant.  Tune in to hear how Emily and her husband decided to drop the price and had their property rented in just a few days.

 

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What You'll Learn...

  • How we ended up with a vacant unit
  • Why we dropped the price
  • Why we enlisted the help of our real estate agent
  • The realities you will face as a buy and hold investor



Resources Mentioned In The Show...



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2 Comments

  • Matilda

    Reply Reply May 13, 2015

    Interesting dilemma there – drop the price or wait a while until you find tenants for the higher price.

    I would approach this from the perspective of how many months do I expect to wait for tenants that would agree on the higher one.

    For example:

    Its the middle of December and in all likelihood, we are not getting people in until March. So these are two months worth of rent lost (January & February). If we had dropped the price to $875, beginning of March, we would have cashed in $1,750 already as opposed to $0 should we have kept the higher price. Question is, if we did not discount it, how many months of renting it out would have offset the losses incurred?

    Basically, after two months on a loss, we finally found tenants and we are cashing in extra $75 each month ($950-$875=$75). In order to make up for the loss of two months ($1,750), we would have to keep the property rented for just over 23 months (effectively 24), $1750/$75=23,3.

    If you were to exercise greed and kept the price up, you would have compensated for those two months after full 2 years!!! So I can only congratulate you on a great decision there.

    Thanks for the podcast, was very nice to hear an actual example how things happened and how issues were overcome in your case.

    Matilda

    • Emily

      Reply Reply June 9, 2015

      HI Matilda,

      Thanks for the comment and the example story you shared. I’m glad to know that the podcast was helpful!

      Thanks-Emily

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