Tuesday, October 16, 2007

The next generation

To the mom at B&N:

Your 4-year-old daughter is selfish, self-centered, and doesn't care to share the train set with the 15 month old and 2 year old children who are so desperately trying to play with just one small portion of the entire set.

While you were on your cell phone, your daughter was attempting to plow over both children because they were standing in the way, playing with their small corner of the set that she would allow them to, as she made her way around the entire train table.

While you were on your cell phone, your daughter got a lesson from me in kindness, sharing, empathy, patience, tolerance of others, especially children younger than her.

While you were on your cell phone, I pitied you and found you self-centered, selfish, and empty.

While you were on your cell phone, your daughter grew up to be selfish, self-centered, and empty - just like you.

Tuesday, October 9, 2007

Monday, October 8, 2007

The whole milk debate...

A recent conversation with a neighbor of a toddler my son's age:

HER: So, are you still giving your little dude whole milk?

ME: Of course. I don't have a problem with it.

HER (contrite and indignant): Well, my pediatrician said not to give them whole milk after age two b/c it was too fattening. I give him 1% milk. Personally, I can't stand the taste of whole milk. Besides, I don't want my son to grow up fat. You know, childhood obesity is a problem.

See, here's the thing. Mr. Landlord and I grew up on whole milk. WE are not obese. WE come from a long line of big Italians and Germans. The little dude has been in the 100th percentile in weight and height since he was born. He's a big kid, and his body needs everything it can get. He is the biggest kid in his class, both at preschool and at church, in his age group. He is also more developmentally advanced.

Here's my take on childhood obesity:

When we were little, we spent an enormous amount of time outside. Never inside watching toons or videos, or playing video games. We learned to play hop-scotch, tag, hide and seek, dodgeball, ride bikes, and explore the open neighborhood. Mr. Landlord did the same, and also spent his time down at the creek catching fish and snakes. (He would sell the snakes to the local pet shop...what an enterprising young man.) By playing like this, we developed the ability to acquire, manage, and sustain long term friendships and social relationships, which made us better people growing up and into adulthood. The concepts/issues of childhood depression, childhood bipolar disorder, ADHD, etc. were pretty much nonexistent. (For the purpose of this post, I won't get into the controveries surrounding these issues and discuss the numerous reasons why they are more prevalent today.) We played organized sports, and learned teamwork through this and other avenues. We experienced plenty of sunshine. And we learned to think critically and abstractly through playing board games.

Childhood obesity is NOT soley caused by ingesting whole milk, for G-d's sake. Get your kids outside. Encourage them to develop social skills through inviting friends over to play, or organizing a neighborhood dodgeball game. Hell, even basketball. Quit feeding them damned fast food and all beige diets. (Granted, toddlers go through the beige stage, but it is shortlived if you handle it right.) Don't make a big deal out of your kid's diet...this is a surefire way to 1) set up a situation of control between you and him/her and 2) it set's them up for a bad relationship with food later in life. If you obsess over what they eat...and I mean OBSESS...then they are likely to obsess over it too...either they will refuse to eat all together, or eat to spite you. Bake them cookies every once in a while...show them it's okay to enjoy the "bad" stuff such as cookies and cake in moderation. And finally, set a good example by eating good, wholesome foods and eating WITH them...Now there's a novel idea...A family meal together.

Friday, October 5, 2007

On Becoming a Slumlord, Part 3

How do I protect myself from bad tenants?

You know, sizing up potential tenants becomes a gut instinct...over a lot of time. I'm am still not good at it. You have to keep in mind that people rent for a variety of reasons: They can't afford to buy, they are still too young to buy, they've run into financial difficulties, their getting a divorce, etc. etc. There are a few things you can do to protect yourself and your investment though.

1. Stick to the lease...don't give an inch. As with most anything else, if you give an inch, they will take a mile.

2. Don't negotiate the rent. You set the rent at what you are comfortable with. It is your comfort you should be worried about, not theirs.

3. Do extensive background checking. This includes credit, criminal, and sex offender back ground checks.

4. I can't say it enough but do frequent, unannounced inspections. Leave a note letting them know you were there and what you found, if anything. This let's them know you are watching your property. (Be sure to have it written in the lease that you can enter at any reasonable time unannounced.)

5. Don't get sucked into sob stories, which is easy to do. Again, stick to the lease, or as my real estate attorney says, to the "letter of the lease." If they begin to give a sob story, just refer them back to the original lease saying this is what you agreed to. That's it...

6. Don't allow them to get any of your personal information. Just plain good boundaries here.

7. If they don't pay the rent on time, within the grace period, IMMEDIATELY put a warning letter on the inside of the front door giving them 24 hours to pay. If they don't pay within 24 hours, start the eviction process. Evicting someone can take up to 3 months in some places. Don't delay. If they can't pay, then they can't pay...simple as that.

8. Get a good real estate attorney who works with rental properties. Let your attorney handle everything. This will save your sanity when trying to navigate the legal system...trust me. It will also give you an edge in court. The cost for the attorney can be deducted from their security deposit.

9. Again, stick to the lease to the "t". Keep your relationship with your tenants simple...you're the landlord, they are the tenant. Get a good attorney.

Thursday, October 4, 2007

A recent conversation

I called the tenants in house #3 two weeks ago...the conversation went something like this:

ME: Tenant, we haven't received your September rent check. You said you were putting it in the envelope you mailed at the end of August with the other deposit checks, but it was not in there. Only the deposit checks were in there.

TENANT: You know, I've been watching my bank account and the check hasn't cleared. I kept watching for it though.

ME: Okaaaayyyy.....well it looks like you need to send another check or money order.

At this point I am thinking to myself, "so, if you're watching your bank account to make sure your rent check clears...and it doesn't....and you have already received a notice from the attorney threatening eviction if you don't pay on time...wouldn't you be on top of this rather than risk having your landlord call you AGAIN and getting evicted?"

I'm an idiot...could someone please explain this to me? I mean, really...please...explain....

Wednesday, October 3, 2007

I wish I were this dog...

Life should be this good.

http://www.stupidvideos.com/video/animals/Dog_Loves_Water_Slide/

On becoming a Slumlord, Part 2

To buy an older home or a newer home...

I really don't think is a right or wrong answer here. Both types of homes have their pros and cons, so I'll talk about each separately.

Buying a new home guarantees you have the builder's warranty for at least one year. AND if anything goes wrong after that for the first two or three years that is related to construction, they will more than likely fix it for free even though the warranty has run out. This has been my experience. You just have to know how to bat your eyes and sweet talk them...sexist, I know, but predictable. You also know that the appliances will be new, so you won't have to worry about a water heating going out or replacing a fridge for a number of years. The paint will be new, the plumbing will work properly, etc. etc. Essentially, your repair costs will be minimal. Finally, your rent home will be in a more desirable area that is more likely to attract better tenants.

However, you are likely to have a larger mortgage payment than if you went with an older home. This means you will have to charge more for rent, your taxes will be higher (depending on location of course), and the insurance might be higher. If you do this right, there is a balance and you can actually make some money buying a new home. A newer home is more attractive to renters who can afford to live in the nicer areas, and I have found they are more likely to take care of your property as they care about the conditions they live in.

Buying an older home can be a crapshoot at times. The inspector will likely find more things wrong with the home, and it may be in a less desirable neighborhood. The latter of course depends on whether you are buying in the tony, charming yuppie part of town in which people buy these older homes, pay a fortune for them, and remodel them thereby maintaining the integrity of the older neighborhood. If you are doing this, be prepared to spend a pretty penny just keeping the home in accordance with the neighborhood HOA. With an older home you can expect to find previous repairs completed in a half-ass manner, which means you will most likely need to go in at some point and have those repairs "repaired" at a much higher cost. You also run the risk of having to replace water heaters and appliances, which can be costly. You may also need to go in and have a number of repairs completed just to get the house in rentable condition.

If you are considering this with the attitude that you're in it to make money and don't care about the overall condition of the house, then an older home may be the way to go. But be warned, as in all areas of life, if you do this half-ass your returns when you try to get rid of the property will be half-ass. AND half-ass repairs will cost you more in the long run.

I rented a 1930s duplex in a charming, well-kept neighborhood in OKC during my internship year. It had wood floors, a lot of space, a washer and dryer and the tile in the bathtub was new. It was also painted in really great neutral colors. However, I soon discovered the decades old heating system was in poor repair and a fire hazard, the window A/C units were not kept up properly, it was infested with roaches, and the vines climbing on the outside of the house were growing inside the windows (the gaps in the windows were that bad.) I also came home one day to find a busted pipe in the bathroom that was flooding my poor little dog out of her home. The landlord essentially didn't care to have repairs done in such a manner that the integrity of the house was maintained, but instead from the standpoint of how cheap could she get the repairs completed. She also didn't care that roaches were eating my sweaters. I imagine if she tried to dump the duplex, she would have a hard time it was in such bad shape.

A friend of mine bought a house in 1973 for about $26,000 and has been renting it over the years. Again, there has been a half-ass approach to having repairs completed. Now, the value of the house rose to about $130,000. Yet, when it came time to dump the property, it sat on the market for a year and a half because the foundation was in such ill repair no one wanted to touch it. It also needed some major repairs. It has taken almost $75,000 to get the house in good enough shape to sell it, which she finally did. However, when you compare the value of the house to how much she made in the sell, she didn't really make that much money. Of course, she was just glad to get rid of it.

Overall, you really have to look at the cost of buying and maintaining the home versus how much you can actually get in monthly rent. Take a long hard look at this...Also consider whether the mortgage payment is so much that you can't afford to make that payment along with your own home payments when it is sitting empty for a month or two waiting for the next renters to move in. There have been times when we have had two houses empty at the same time...it's not easy making three mortgage payments at once.

Of course, if you have the cash to buy a property outright, then by all means go for it. You'll be way ahead of the game!

Tuesday, October 2, 2007

On becoming a Slumlord, Part 1

In a recent conversation, a friend revealed a desire to become a slumlord as a means to make more money and to have something to do. After much thought, I decided to write more about what I know about landlording...perhaps educating those who are indeed thinking of getting into this crazy business.

My background: I hold a doctorate in child psychology, but am currently staying at home with my toddler. So, since I'm not "working at a job" (I think being a mom is a 24/7 job, even if you go on frickin' vacation), it is logical between myself and Mr. Landlord (the breadwinner) that I be the one to manage the rental properties we own. We own three rent houses. The first is our previous residence and a very nice house in a very nice neighborhood. The other two are new homes located in up and coming areas of the burbs around our town. We purchased the latter two because the areas they are in are currently being developed into mega shopping areas, more schools, etc. etc. so we know their value will certainly increase over time, and perhaps increase the quickest over the next few years as the development continues.

Now, being a landlord is time CONSUMING. You think that you get a property, get some folks in it, and you're all set until the end of their lease. WRONG. If you really want to maintain your property and make sure it isn't being torn to pieces, you must do biweekly or at least monthly inspections. Remember: it is an investment so the better care it receives the better your return will be. It should be written in your lease that you are allowed to enter the property at any reasonable time you choose, unannounced, for inspection. This helps ensure that you have control over what happens to your property. Tenants will NEVER report repair needs unless it inconveniences them in some way. I had some tenants who had a leaky shower and they never reported it. Didn't inconvenience them. However, when they moved out I found the leak and ended up having to hire a guy to break into the wall, fix the leak, put the wall back together, paint, etc. This was more costly than their deposit, but the leak wasn't found until too late. Shame on me for not doing proper inspections. Proper, unannounced inspections will ensure your property is appropriately maintained, and will alert you to problem tenants...to be covered later. However, it is...again...time consuming.

Now, if you get a high maintenance tenant in the property, that eats up more of your time. They report EVERYTHING, which requires several visits a week as well as many phone calls OR they are the type of tenant that you suspect has the potential to really do some damage so you have to conduct inspections at the very least once per week or more. This eats a lot of time, especially when you are trying to manage your own home and your own family. Why not hire a management company? Good question...we'll cover that later as well.

Finally, if you go on vacation, be prepared to have your vacation interrupted by an emergency phone call from a tenant. On our last beach vacation, I spent one day trying to find someone to fix the fridge in one of the houses. A storm blew threw, shorted the outlet, and fried the fridge. Then there were several followup calls to ensure the repairs were done and to pay the repair people, as well as hear more from our tenant about how we should pay for their lost groceries. Sorry, if a storm blew threw at my house and my fridge fried, I wouldn't have anyone to cover my lost groceries. I'm not mother frickin' nature.

Overall, our rental properties consume about 40% of my time per week. That leaves 60% for my own family and my own home. Seems like enough, but it really isn't. Things always come up and my own home and family fall by the wayside. The requirements of being a landlord also fluctuate...a lot. One week I may have to focus on all three rental properties the entire week, thereby letting my own home responsibilities pile up until I can get to them, and then another week I may hear nothing from our tenants. But on those weeks, I'm catching up from the previous week so I can't focus on what needs to be currently done. It is a constant game of catching up. This is something to think about...

So, next time I'll talk about what type of property to buy - a new or older home.

Monday, October 1, 2007

Teachers...

I just returned home from dropping the little dude off at school. This is PRESCHOOL and he goes 3 days a week for about 6 hours. There are no bells. You can drop off and pick up anytime between 7:30 and 5:15 pm. He arrived at 9:15. We got a NASTY stare from his teacher and a very curt hello...apparently arriving at 9:15 is disturbing to the "flow" of class and the teacher had to stop reading to get him some goldfish so he could join his buddies at the table for snack. Again, it is policy that you can drop off at any time...if you need to establish a cut off time, people, then do so. If you leave the drop off/pick up time open, then expect a few interruptions in the mornings...

This is why I hate the school system....

Babysitting blues

In my continued search for a babysitter, I registered to participate in Mommy Mixer. I have known about this service for about 1.5 years, but refused to participate in the past. The dude was too young to have an inexperienced college freshman taking care of him. However, desperate times call for desperate measures so I broke down and decided to expand my sitter search.

So, the premise of this mixer is that moms needing babysitters meet college girls looking for babysitting/nanny gigs at local hip and trendy businesses willing to host the event. College girls fill out an application on the website for FREE and moms register by paying $100 and signing a waiver stating they understand the girls have not had background checks, etc. conducted on them by Mommy Mixer. It's kinda like speed dating for babysitters.

Mommy Mixer gets rave reviews, and my neighbor knows the owner of this business. In theory it is a fantastic idea, and there is certainly a need for this type of service. And Mommy Mixer is expanding to many, many cities across the U.S. However....

Yesterday was my day to go, so I got dressed, put on makeup, did my hair and walked out the door leaving Mr. Landlord and the dude together for father-son bonding. I was looking forward to seeing what it was all about and hoping beyond all hope that I would find a person that meets my standards for a babysitter. I'm still hoping...

Upon arrival I signed in and picked up my babysitter notebook containing the resumes of all the girls that were supposed to be in attendance, as well as resumes of girls "who couldn't be [there] but would love to find a wonderful family to babysit for." In all, there were about 35 resumes in the notebook. It was looking promising...

Then all the moms started filing in...one after another. But I kept looking for the potential sitters. Hmmm....they have to be around here somewhere. There are supposed to be about 25 girls here. Then the hostess with the mostess announces that, for some unknown reason, several girls couldn't make it to the event so we would just get started...

There were 7 girls and 30 mothers there. You do the math. The event organizer made about $3000 for 1.5 hours, and the mothers were out $100 and only got to interview 7 girls. I want my money back...