Landlords Are Just Glorified Babysitters

While I’m feeling weak and vulnerable, I figured I may as well share, like a circled pride of wallowing hippies, singing their emotions with a tamberine and good spirit. Apparently tears and emotion make the recipe of a profound piece. Unfortunately, I don’t have a tamberine, but I have plenty of emotion to squirt over this page. Enjoy.

Earlier today I was contemplating the idea of acquiring another BTL, but then I was rudely awoken by the part of me that repels responsibility. It was one of those misplaced thoughts that had no business being there; derailing me from potentially expanding my minuscule portfolio (which should ordinarily be a positive thing). I felt like I had thought about my mum during intercourse. (GET OUT OF MY HEAD)!

I’m probably going through a phase which I’ll shake off after the next time I have sex, but right now, the thought of taking on another buy-to-let makes me want to vomit over your face. Your face, not mine; no point ruining art over a hissy-fit. Anyways, I want to explain…

You see, it’s the responsibility; a lot of it comes attached with a buy-to-let property. It’s one of those things that you’ll never fully appreciate unless you’re a landlord. Most people that have had zero experience being a landlord believe that it’s either a) a stroll in the park b) immoral, and abusive to those less fortunate (or some similar bullshit argument to that degree). Let me assure you, it’s neither of those things. Bear in mind, this is coming from someone that believes prostitution is moral; just immorally overpriced.

I know, how crass, I’m sitting here snarling at the concept of buying a property because the responsibility is too much, while there are real problems in the world, like the size of Christino Ronaldo’s Adam’s apple. Shouldn’t forget the children either, because it’s always about the starving children. Alas, I can’t worry about all the problems in the world at once. One problem at a time.

I’m just going to say it. The idea of having to deal with another petulant/irresponsible tenant fills me with fear and makes me want to cry, so my plans for expansion is currently on halt. If there’s one thing I’ve learned from being a landlord, it’s that “good tenants” are as rare as uncovering a completely odourless… vagina.

I’ve written blog-post-after-blog-post on how to find good tenants. Sure, the articles are awesome and incomparable, and I should be nominated for several of those bullshit blogging awards that get dished around these days, but ultimately, all those articles will do is help reduce risks- there’s no formula that can be applied to completely filter out deadbeat tenants.

In fact, it’s not just about finding “good tenants”, in the sense that they pay their rent on time and look after the property- that’s only half the battle. The real challenge is finding a tenant that won’t bother you all day long over every little fucking thing, like a loose door handle that they’re either too lazy or incompetent to tighten. Now they’re the fuckers that will make you want to blow your brains out.

I remember last year when I was kicking back in Vegas, in the midst of drooling over my 6 pack while oogling at the poolside ladies, when I was interrupted by a phone call from my tenant. I can’t remember what he wanted, but I recall something had broken, besides from my erection. It was inconvenient to say the least. It’s those little moments that make you think, “is it worth it?”

Being a landlord is more fun if you have a massive portfolio and a cashflow that will allow for others to do the monkey work. Otherwise, if you’re a small time landlord with a pitiful portfolio, like myself, the task is mostly menial and inconvenient, and you’re reduced down to nothing more than a glorified babysitter. Cleaning up after tenants, and continually having to ensure they behave the way they’re contracted to behave (which they mostly don’t) is all part of the job. That’s a sad fact of reality.

So, i’m sat here thinking, “do I want the responsibility of another child, that may or not amount to something?” That’s the question EVERY small time landlord and prospective landlord should ask themselves before buying property.

The prospect of increasing my exposure to rent arrears, criminal damage, human excrement smeared on walls (yeah, I’ve dealt with that) are just a few of the obstacles in my way. Each time a new tenant/BTL is acquired, the greater the risk becomes, and that should be enough to make anyone think twice (at least momentarily). This blog is full of comments from landlords that wish they’d never become a landlord because of their misjudgement (i.e. they assumed being a landlord was an easy way of getting someone else to pay off their mortgage).

Tenants Vs Crap on walls

Think about it. That’s all I’m saying. You’re not just gaining equity in a property when you become a landlord, you’re effectively buying a child with it.

Right, anyways, I’m off to look on Rightmove (yes, I was having sex while writing this blog post).

Peace, lovers x

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17 Comments- Join The Conversation...

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YesAdam 25th June, 2012 @ 13:12

Your formula is incorrect, the greater your portfolio the greater diversity you have. The less dependent on finding a tenant QUICK and more on finding a good Tenant.

This bit is wrong "The prospect of increasing my exposure to rent arrears" as you will be diversifying your portfolio. Enabling other paying tenants to cover the missing rent of the "bad tenant" whilst you work on possession.

"criminal damage, human excrement smeared on walls" this bit - yer probably a increased risk. If you increase portfolio maybe hiring someone to remove smeared wall poo could be affordable.

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YesAdam 25th June, 2012 @ 13:14

"exposure to rent arrears" if you have 1 tenant and defaults that's 100% exposure to rent arrears.
If you have 3 tenants and 1 defaults just 33%
If you have 4 tenants and 1 defaults just 25%
if you have 5 tenants and 1 defaults just 20%
If you have 100 tenants and 1 defaults, then your defying the odds, wake up and stop dreaming.

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The Landlord Avatar
The Landlord 25th June, 2012 @ 15:35

Oh dear God. Here's the "actual" formula (as opposed to your Disney version)...

Suppose we treat a tenant failing to pay rent for a given period on time as independent event with probability X.

For monthly rents over a period of a year, we would expect X * 12 failures to pay rent. For example, P = 0.25 means you expect to have 3 failures to pay in time in a year.

Now, suppose I have T tenants, each of which fails to pay rent on time with probability X, in that case, I would expect to have TxX failures in a given period.

So for 4 tenants (T=4), each failing to pay on time with probability 25% (P=0.25), I would expect 0.25x4 failures every period or 12 failures per year (instead of just the 3 I would expect from a single tenant).

Quad Erat Demonstrandum, my exposure to rent arrears has been increased by taking on more tenants.

Basically, you're wrong.

In layman's terms, if I walk under an apple tree which has 20 apples, I'm more likely for an apple to fall onto my head, than if I were to walk under an apple tree with 1 apple.

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YesAdam 25th June, 2012 @ 16:14

Your logic is flawed. The ratio to total rent:total arrears remains the same, except by adding further properties diversify the risk.

Then you have Economies of Scale.
the theory is the bigger your enterprise gets, the cheaper things become. Agency fees, landlord insurance and management costs can all be reduced when your portfolio gets bigger because with more properties you’re offering more work up for your suppliers"

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The Landlord Avatar
The Landlord 25th June, 2012 @ 16:35

First you said my formula was wrong (when it actually wasn't), and now you're saying my logic is wrong.

Anyways, you're missing the point. My point is, I'm taking on more risk each time I buy a property. Pretty sure everyone caught my drift, besides from you. This isn't about how another property can make me more money.

My post discusses economies of scale- "Being a landlord is more fun if you have a massive portfolio and a cashflow that will allow for others to do the monkey work." However, the difference between 1 and 2 properties won't qualify for economies of scale.

Feels like you're just dragging up any ol' crap.

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Steve 25th June, 2012 @ 21:56

I have had the same feeling for some years as the hassle deserves more than 6% yield.
If you can't find anything above 6% then I personally wouldn't bother.
If you put some of these in a ISA (tax free income) then it's a lot less hassle.
http://www.topyields.nl/Top-dividend-yields-of-FTSE100.php

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YesAdam 26th June, 2012 @ 09:02

Your formula is wrong due to your logic being wrong. Your taking into account the potentially increased arrears but not taking into account the increased income.

At the end of the day, if you don't want to babysit tenants..

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The Landlord Avatar
The Landlord 26th June, 2012 @ 09:25

@Steve
Totally agree. And I'm glad I'm not the only one who has cold feet about it, for the same reason(s).

@YesAdam
As I said, you completely missed the point of my blog post. This isn't about earning more. This is about the hassle of having to deal with more tenants...

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andrewa 5th July, 2012 @ 04:59

Ah, but we(or at least I) am in it for the money, yes tenants are a pain but hopefully you are leveraging off the properties you already own (Its a pleasure to be a landlord when some of your properties have only 5 years left on the mortgage). Go on, be a devil, buy another and put up with the problems, when you have 16 properties in 20 years time you will look back on what you wrote today and laugh!...............Old Jewish saying "overnight success takes 20 YEARS"

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andrewa 5th July, 2012 @ 05:05

Old South African saying................"if it was easy then everyone would be doing it"
And RE: Excreta on walls old Scottish saying.........."where there is sh!t there is money-or is it where there is muck there is brass?"

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Steve 5th July, 2012 @ 08:52

My properties have no mortgage on them but if the yield isn't good enough to purchase another one I wont.
The trouble with rental property is you are a sitting target for changes in government taxation or rules.
If you drip feed your rents into a ISA then you are turning taxed money into untaxed.
http://jlcollinsnh.wordpress.com/2012/05/12/stocks-part-vi-portfolio-ideas-to-build-and-keep-your-wealth/
Once this pays off you have sorted everything no loans no hassle and your money keeps on building (especially if you reinvest the dividends).

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Gee Bee 28th July, 2012 @ 18:08

This article has just totally contradicted another one of your articles where you ask what is the use of letting agents. I own a letting agency and all the issues you mention (the excrement, arrears, unreasonable requests, phone calls at 1am because a tenant has seen a mouse etc etc etc) are daily occurences. I'm not complaining because THIS is what we get paid our management fees for (and tenant fees). Letting agents don't just find tenants (as your other article suggests) - that is the easy bit. The hard graft is the follow on service - we take all of these headaches away from the landlord (majority of whom have day time jobs), sift through the rubbish and give the landlords the facts. They are then free to have phone call free holidays and concentrate on their day job or building their portfolio. It sounds like you should think about using one.

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The Landlord Avatar
The Landlord 28th July, 2012 @ 20:18

@Gee Bee

This article doesn't contradict that article; you clearly miscomprehended it. And you're massively overselling the role of a letting agent.

If a tenant calls up your agency and says something is broken, who do you then have to call to notify?

The landlord? Yes! The responsibility ALWAYS falls onto the landlord eventually (it doesn't matter who passes the message on).

If ANYTHING goes wrong, the letting agent has to notify the landlord. The landlord doesn't escape any form of "responsibility" by using an agent.

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Steve 29th July, 2012 @ 06:32

Gee Bee,
The troubles don't go away just because you have a Letting Agent.
A friend of mine bought a house and this was prepared to let out,he decided to go with a Letting Agent and it has been empty ever since (above 8 months).
I have Let 2 houses out to good tenants in this time,all because the Agent hasn't done a good job of the advert and has set the deposit to high.
If someone doesn't know what they are doing and don't learn or do any research about that area it doesn't matter weather this is the Agent or Owner that is incompetent it is the Owner who sups the bill!

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Steve 29th July, 2012 @ 06:41

Lower rental yields given by having a Letting agent also make owning a property not viable.
Why would you have a property with a yield of less than 5%.
Which is what you would have in most cases if you have a letting agent.
Plus the pain of having a boiler replaced at £1500 would increase to £1600 and having no control over the boiler make.(Most likely to be the cheapest most unreliable Boiler on the market if this is left to anyone other than yourself).
In this instance you would be done twice as the plumber goes for the boiler with the most profit in it for him and the agent goes for the plumber with the most profit in it for the agent.

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ruphilyn 23rd October, 2012 @ 06:40

Being a landlord has both good and bad effects on you, good because you creating money, bad if you will have a tenants who are pain in the ass...

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Anon 27th February, 2013 @ 01:30

Whats the point of borrowing money at 5% and then renting out at a return of 6%? (that is assuming no voids).

One top of that you take the risk, property prices might crash. Whats the point taking in £100 in a week in rent, when prices have crashed £30,000?

You risk the threat of tenants wrecking the place.

Every 5-6 years, you have to refurb the place. So no rental income.

More regulation is on the way if Labour get in. We already got screwed over the LHA system.

I am finding when a tenant leaves, then it is harder to attract new quality tenants.

There is no money in renting, and the golden period for the rental sector is over.

Time to sell up. I think!

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