I’ve sold a few homes that were owned by people who hoarded. Hoarding is a mental illness. I don’t believe in judging people for the way they live, and I try to be as compassionate and helpful as I can when working with someone who has gone off the deep end and crammed every available space in their home with objects that may have some intrinsic value but in the larger context compared to the home value appear essentially worthless. I understand how it can happen, and I feel for people in that situation.
This week I met with a couple who had, unbeknownst to them at the time, rented out their condo to a hoarder. Much of the place had been cleared out, but not cleaned when I arrived to take a look. I had brought our family Odyssey and after we met I took a load of books and records to the Salvation Army on 4th Street. The less we contribute to landfill the better. I first tried the Goodwill because their recording said they took donations until 6pm Tuesday through Saturday, but the gate was closed when I arrived and a posted sign read, “Temporary hours 10am-2pm.” I felt lucky that someone was at the Salvation Army to receive my load because I didn’t want those books and records in my car any longer than necessary. As I drove around I quickly realized they had an unpleasant odor.
This condo will need fresh paint, new carpet and pad. The refrigerators, there were three because hoarder collect everything, were all quite filthy. Hopefully the one that came with the house can still be used once it’s thoroughly cleaned out, but whomever has that job will need to wear protective gear from head to toe. The best option would be to take it outside and turn a firehose on it. I’m not exaggerating.
There is a reason I don’t invest in properties other than the one I own. There are plenty of advantages to being a landlord, including getting cash flow and appreciation, plus the tax advantage of depreciation on the properties. I know very successful Realtors who throughout their careers acquired multiple properties and managed them successfully. I know of one man who owned something like a dozen properties in Marin, mostly condos, all of which were professionally managed and did quite well as investments. I see the upside in owning investment properties.
Unfortunately, I also see the downside. Getting a hoarder as a tenant is really bad but it could be worse. You could have a hoarder who stops paying their rent and won’t leave unless evicted. Evicting people takes time and money, and it seems like in recent years I’ve run into more property owners who have had recalcitrant tenants who refused to leave. One had to be paid to leave after staying six months past their notice to terminate tenancy, which caused them to miss the prime selling season. Lawyers for both the tenant and landlord became involved, which was a costly shame.
Finding a good tenant can be a challenge. I’ve seen property owners sit on vacant homes for months trying to get someone in, meanwhile they are missing out on cash flow. If you do find a good tenant and they eventually leave on their own accord you can expect normal wear and tear on the unit. That translates into the owner painting the home and likely putting in new carpet at their own expense. If there is damage to the unit a landlord can keep the deposit by presenting receipts for repairs to the former tenant, but the opportunity cost of rent not collected while repairing the house is high.
20 years and counting into my real estate sales career I will sell you a home that you really want as an investment property, but I will have to warn you in advance. Things can and do go south.
*** Thank you for reading my blog! If you or any of your friends and family ever have any real estate questions, please feel free to contact me at andyfalk2112@yahoo.com or 415-250-8025. I’m always happy to help!