Landlords should be required to publish what capital they’re putting into a property, including interest. This data point alone would make it clear how good of a landlord you have.
There are two tough spots for landlords. There are some truly awful tenants out there. You can’t effectively screen them out.
The other hard place is lenders. Lenders soak up the margin. Unless the landlord rents out free and clear property he’s always behind, and it’s hard to maintain “his” property to provide a real service to tenants when he's collecting for the bank.
On the contrary, lenders have been the landlords best friend. Until recently, you could borrow money at 1-1.5%, buy a property and rent it for 5%+ return, banking the difference.
This was basically free money and the optimal thing to do was to borrow as much as you can for as long as you can.
You could put a small deposit down, and by the time you add the margin on the borrowed piece then you were yielding 10-20% on your cash in. Much better than just the 5% on unemcumbered property.
This model has completely collapsed as interest rates of normalised.
> Until recently, you could borrow money at 1-1.5%
Please share more details. Because even during the pandemic, when rates were at their minimum, the lowest conventional 30 year mortgage rate that I saw was over 2.7%.
There are two tough spots for landlords. There are some truly awful tenants out there. You can’t effectively screen them out.
The other hard place is lenders. Lenders soak up the margin. Unless the landlord rents out free and clear property he’s always behind, and it’s hard to maintain “his” property to provide a real service to tenants when he's collecting for the bank.