House Hacking: How Hard Is It Being a Landlord? My Experience

Being a landlord comes with its challenges and responsibilities, of course.

As someone who owns and manages two house hack properties to date, and have been managing for a little over 4 years - I have gotten some valuable insight and experience in the world of being a landlord/property manager.

Piggybacking off of the last video on my personal experience through house hacking,

Today I'm going to talk about the landlord side of my experience so far.

So one aspect of being a landlord is the ongoing communication with tenants.

Initially, I anticipated spending a significant amount of time being a landlord. And quite frankly - I was very nervous at first.

I had no knowledge of how this stuff works at all if I'm being honest.

It was easy when I was living in my first place in Ames with my friends from school, but once I moved out and into my 2nd property, I had no clue what to expect.

Well, here's what I've got for ya:

Today, I'm in my 3rd property and manage the first two house hacks - and prepping for this 3rd property to become our 3rd house hack as we close on our 4th later this year.

On average, I spend just about an hour each week total responding to texts and emails from tenants between the 2 current properties.

Of course, this may not always be the case in the future - it really depends on the tenant or tenants in the property, and the condition it is in - when you move out and how you leave it for them.

But I anticipate another hour or two per week managing our properties once we've moved into our 4th and our 3rd is rented out

So here's what I did:

To try and streamline the responsibilities of being a landlord - I put in a decent amount of time at the start. 

It was probably a good 3-4 days worth of creating research, spreadsheets, digging into software that could automate various landlord tasks, and really just anything I could do to try and reduce the time needed to attend to the properties. 

And boy was it worth it - it has significantly reduced the time and energy required for managing these properties (again, around like an hour a week on average).

Taking just 3 or 4 days to do this has allowed me more personal time with family/friends 

and also with work being a Realtor which requires flexibility for clients and appointments

it's saved me well over that amount of time it took to get all of these systems in place

If you're interested in House Hacking, reach out to me - I give all of these spreadsheets and tips to all of my clients who are house hacking!

But anyways,

A super important piece of being a landlord is budgeting for repairs and maintenance

This is another one of those worries I had in the beginning. 

"Am I saving enough? What if something breaks right away?"

Well, to help with that little bit of anxiety, we save about 10% of the gross monthly income from each property into a high yield savings account.

So far, I think we've spent somewhere around $3,000 on general maintenance and repairs across our 2 current properties since I purchased the first property about 4 years ago. So $3,000 over 4 years, about $750-ish per year for both properties.  

This is why it's super important to account for this and save up some percentage of the rent for repairs..

Now of course, this might not always be the case. You could go years with no issues, then all of a sudden get hit with a year where you need $15,000 in repairs.

I recommend 10% or MORE because it gives you a ton of cushion and also relieves you from the emotional "crap there's a repair" response when your tenants say something is broken.

The money is already there for the repair. 

AND, it's not like you don't have that money.. You still have it, it's just allocated for repairs. You still have the money! If you save a percentage of your gross rent for however many years and hardly have to dip into those savings until you sell it - it's still yours. 

That's also why I throw it into a high yield savings account so even THAT can grow with interest rather than into a checking account where it returns 0

But if you don't set any $ aside, and spend all of the cash flow you receive - you don't want that $15,000 repair situation with no money to replace it.

it is your duty as a landlord to maintain safe living conditions for your tenants at all times. It IS a business!

Along with that, We also save another 10% of the gross income in the chance we can't get a tenant in right away or a tenant breaks their lease in the middle of it where the property is vacant for a month or two.

So far we have had 100% occupancy on both properties and haven't had a month of vacancy yet

- key word "yet" - again, this may not always be the case so do yourself a favor and save up to save the headache!

Be prepared!

Treat your tenants and property right, your tenants and property will return the favor.

"happy wife, happy life" "Happy property, will pay you properly"

Overall, my experience as a landlord has been relatively smooth. 

While we currently manage our properties ourselves, we understand at some point down the road - whether that's property #4 or property #10,

that there will probably come a time where managing these ourselves will interfere with personal time, family time, and work. 

Whenever that time comes, We'll probably explore the option of hiring a property manager - 

where delegating those responsibilities to someone else will provide a better return on our time and energy rather than self-managing. We'll See!