Humidity in basement apartment

2017-10-05 16:07:45

I also have these so-called "experts" in my circle of acquaintances who always say, "Why don’t you buy apartments to rent out..?" blah blah... I lean back, let them talk nonsense, and enjoy my big plus in the stock portfolio. If I feel like it, I can sell everything tomorrow at the push of a button...

Well.

If you have a good portfolio, what kind of long-term return on equity do you make? Decent, but...

When good real estate was affordable (a few years ago), you could buy apartments with very little equity, i.e., high leverage, with returns on capital of 4%+x. Returns on equity after paying off the loan through the tenants (!) were amazing. Renovation costs brought hefty tax savings if well timed.

But yes, the obligation to take care of things is a completely different, bigger, and more immediate one than with stocks. Anyone who claims it’s easy is stupid. Anyone who claims it brings nothing or less than stocks is stupid too :-p.

Do what you can and not what others tell you.

Anyone willing to put in the work and acquire the corresponding education (!) can, of course, scale bigger with real estate than with stocks.

With a single apartment, of course, you have concentrated risk. It can go well, but it doesn’t have to – as we see here.

Still, depending on the return versus achievable sale price, I would weigh whether to fix the damage and keep renting or to sell.

2017-10-05 17:07:04

Have you ever heard of rental pool management?

No direct stress with tenants, no losses during vacancies, etc.

Experience only from hearsay unfortunately, there are surely disadvantages.

2017-10-05 17:08:17

Well.

If you have a good portfolio, what kind of long-term return on equity do you make? Respectable, but...

When there were good properties available cheaply (a few years ago), you could buy apartments with very little equity, i.e. a high leverage, with capital returns of 4%+x. Returns on equity after paying off the loan through the tenants (!) were phenomenal. Renovation costs bring substantial tax savings, if well timed.

But yes, the obligation to take care of things is a very different, bigger, and more immediate one than with stocks. Anyone who claims it’s easy is stupid. Anyone who claims it brings nothing or less than stocks, also :-p.

Do what you can and not what others say.

Anyone willing to put in the work and acquire the necessary education(!) can of course scale bigger with real estate than with stocks.

With a single apartment, you obviously have concentration risk. It can go well, but it doesn’t have to – we see that here.

Nevertheless, depending on the return versus achievable sales price, I would weigh whether to fix the damage and continue renting or to sell.

My statement refers to the current market environment and that of recent years. 10 or more years ago, of course, it was different. No question..

2017-10-07 19:48:20

The tenant has to vacate the apartment so that the renovation can be carried out.

He has already emptied the apartment.

He has now spoken with the tenant protection association and wants to commission his own expert report, which is not supposed to be done for another three weeks. We are not supposed to renovate for that long even though there is imminent danger.

Do you have to accept something like that? The painter says the mold is growing so aggressively that by then it will no longer only be on the wallpaper but will have penetrated into the wall or the laminate floor.

2017-10-08 06:23:40

What does the tenant want to achieve with the report?

Is he supposed to be charged costs against which he wants to defend himself? Or does he want financial compensation from you for the effort he now has or something like that?

2017-10-08 07:50:59

I don't understand either what he is trying to achieve. I even confirmed to him in writing that no costs will be charged to him for the renovation.

It can only be about the rent payment until the end of the contract. If he terminates now, he would still have to pay rent until the end of January. Even though he will no longer move in. I suspect that is what he wants to clarify.

He argues that there was a small dark spot visible when moving in, which in his eyes presumably led to the catastrophe. Now that such a spot (mold spores, after all) was also found in the bedroom after the furniture was moved out, he said that this is proof that the mold was already there before moving in.

His couch also got moldy at the back because of it. Maybe he wants that replaced as well. No idea.

It is probably about the fact that, since the apartment had to be vacated for the renovation, he wants to use this as a reason to terminate without notice.

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Humidity in basement apartment

chand1986

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Steffen80

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aero2016

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