- Personal Finance
Making money with Vancouver rental houses, pay off your mortgage faster
my rental houses
How to make money from rentals
Why Share your House with Renters?
Realestate has crashed in the USA recently and there are bargains out there. Many people don't want to share their house with renters, but it can work out great.Our first house was run as a typical 1970's commune with a group of our friends sharing the bathroom, kitchen, living room and sometimes each others bedrooms etc. The only difference was my husband and I bought and owned this house and the room rentals paid the mortgage.We did the maintenance. Houses were relatively cheap in the early 1970's and most young people preferredto rent. It was cheap and less hassle.
Rich because of Racism
My husband was Japanese Canadian , and Vancouver was fairly racist at the time. No one would rent to us. So we bought our first house because we got tired of the racist responses of landlords.Though we have never had high salaries we are both financially secure now thanks to racism and Vancouver's hot realestate market.
I was Lucky to buy a Triplex
When my husband and I split up I took my share of the money accumulated in our first house and bought the blue house pictured above. It is a legal triplex and has been shared various ways with co-owners, relatives, friends, and tenants who have become my friends. This has been my experience for the past 25+ years. Since then I have bought other rental houses with partners and on my own. My ex husband also remodeled his house and made it into a triplex. This system has worked well for him and for me.
For the last 20 years my residence has been divided so most housemates have private entrances and living areas. I am no longer so tolerant of people sharing my kitchen so I give a rental discount to the person who occupies a large bed sitting room in my suite, but cooks with in one of the other suites.
Realestate Purchases must be done carefully
It is important to buy carefully and make sure the rental income will cover all expenses:mortgage, taxes,repairs and maintenance. This means buying property where rentals are in demand. I know people who buy a condo or apartment, rent it out to pay expenses, and live in a less expensive place. I know other young people who purchase property and continue to stay with their parents so they can have the rental pay the mortgage and save their money to make lump sum payments.
To get great tenants careful screening is necessary. I always meet the tenants face to face and ask them for two references from two places they have rented previously. I check with their boss and or financial institution to be sure they can afford the rent. I ask for a personal reference from someone who has known them a long time. And I ask the prospective tenants if they smoke or have pets. I ask this same question of their references.
Beware of grow ops
There is a big underground marijuana industry in B.C. Often growers of pot rent a house and start a large grow op in the rental. This can result in a destroyed house with ruined floors, mould in the insulation and other destruction. It seems that the best way to avoid renting to alcohol or drug abusers.
To weed out people who may start a grow op:
1) Keep a close eye on the property.
2) If possible live in one of the suites of the house you are renting.
3) Rent only to nonsmokers. I have serious allergies and hate the smell of smoke. So I can usually smell if the person is a smoker. Also it is easy for me to ask the personal reference person if the person applying to rent my apartment smokes or would allow their friends to smoke in the apartment.
4) Get a detailed list of questions from a landlord interview form, and ask the questions so you can learn if the prospective renter is responsible and can afford to pay the rent.
Do it yourself
I sometimes choose to do some painting and minor renos myself. Luckily my partner Marie-Belle is a great renovator and loves to repair and renovate her properties. Painting and new flooring make a big difference to a house.. I have learned a lot about minor repairs and how to contract with repair people for larger jobs. I have developed a list of excellent local electricians, plumbers, carpenters and handymen so I know who to phone if there is a problem.