Friday, January 12

Real Estate: Heaven and Hell

My life right now seems to be completely dominated by real estate. I own (with the bank) a house that has a basement suite and I am currently interviewing prospective tenants for February 1. The past 6 weeks have been the nightmare of dealing with bad tenants. (I'm pretty convinced that one of them will not end up paying up what he owes me before he leaves.) And even though the market is really good for landlords right now, it is still such a hassle to deal with renting out a place. I feel like it could easily become a full time job just placing ads, answering the phone and showing the place. And I still have references to check and all that jazz!

But that's the hell part. Last year, real estate was heaven. I sold the house that I bought 18 months earlier for more than double what I paid for it. Can you say net worth increase? Wow! And then I bought this current place with a basement suite for about $130,000 more mortgage at 5.4%, or an additional approx $800 per month. The great thing is (I thought) that the basement should easily rent out for $1000 or more, making cash flow better and paying down on a more valuable property. All win, right? Well, sort of. If I can get good tenants in place I still believe that this is going to work out very well for me. So I grind through some hell to get to heaven. Actually, if I can get it fully rented it will cover over 90% of my mortgage payment (principal and interest, not taxes). Not bad....