The big-giant "Mistakes Made, Lessons Learned" thread

therenoguy

Inspired Forum Member
Registered
A whole forum on failures and mistakes would be absolutely invaluable. I don't have the power to make that happen, but I can do this.

We've all heard the old maxim, "Success is a very poor teacher," yet there is a penchant for us to want to read only success stories. But I think there's a lot more gold in those failures, mistakes, and missteps that have left us smacking our foreheads.

But we need to share them. It reminds us of them so we won't do them again. It's cathartic to share personal stories that have us doing a Face Palm. And most importantly, it helps those who come after us to avoid the avoidable, to benefit from our experiences.

I say: keep a failure to yourself and you doom someone else to the same fate.

I'll go first.

Mistake: I once had a double lot with a tiny house on it in a small Alberta town. The tiny house was making just enough to cover its expenses. I wanted to sell the lot, and asked a real estate expert what to do. Said real estate expert said to knock down the house, and investors would consider it shovel ready, and it would increase its sale-ability.

That did not happen. Now the lot is empty, slowly bleeding cash, and we can't sell it, even at fire sale prices. We are lining up our ducks to build, but right now it's rather painful.

Lessons learned:
Sometimes it's best to take the sure thing. If we had instead listed the lot, and said we will include demolition of the house in the price, it wouldn't have likely hurt our chances of selling, but we would have at least been breaking even while we waited for it to sell, or to create enough cash to build.

Onward.
Keith
 

Thomas Beyer

Senior Forum Member
REIN Member
Many many many mistakes. The biggest one probably was that I started only in the year 1997, way too late. early 1990's would have been better .. or early 80's .. or early 60's .. plus 80 more lessons in my book linked in my footer, also on Kindle or Kobo.

On average real estate goes up at least with inflation and usually more in urban areas where 70%+ of society lives these days. So buy one, and hold forever, or better: several.

I started with a $80,000 condo with twenty down and the next condo too was 80,000 with the down payment from an LOC .. And that then grew into more condos, houses, multi-family, mobile home parks and land projects. More on that in the various blog posts, my book and the occasional REIN lecture.
 
Last edited:

kfort

Senior Forum Member
Registered
Always more expensive to put the wrong person in than carry a couple/ few months of expenses. I've learned this one twice unfortunately.

And always cheaper to learn from others' mistakes than your own. That's why I love this forum.
 

therenoguy

Inspired Forum Member
Registered
I'll keep eyes out for those inspection details, Sharon. Thanks.

And Kfort: wow, that is like the most important lesson we all get to learn...

Mistake:
I took a chance on a tenant once. It was the 11th hour and I was staring down the barrel of a month of empty house. I broke my own rules and let these people in, even though I wasn't able to do as careful checks as I usually like. The guy was self employed so I couldn't call an employer. Turns out the last landlord lied through her teeth to get rid of them-she said they were stellar, fixing up the house, etc.

They were a scourge on the whole neighbourhood and were late by the second month. I got so lucky in that a social services agency paid their rent for the rest of the 6 months lease. These people win the prize for teaching me more than any tenants before or since. They left a mess(6 trips to the dump with truck and trailer), but at least I got paid. It was a miracle.

Lessons learned:
-Make rules for yourself and what tenants you'll accept and NEVER break them, even if it looks like you'll be empty for a month.
-If you can't check employer or landlord, to your satisfaction, move on.
-If you even smell a hint of a rat, move on.
-If something about their story sounds a bit odd, move on.
-The SECOND you have trouble(day 2 after rent is due), call a company that specializes in evictions and collections. I did this, and it was the best $700 I've ever spent in my life. You have better things to do than to serve tenants, go to court, and try to navigate the legal system. These people had served them within a day, and had a judgement against them in a week and I was able to move on with my life.
-The landlord tenant resolution board means well, but won't do you much good. I was going to do this but decided against it when I found out how much time it would take, how much I had to learn in a very short time, and how everything had to be done in exactly the right way or I was screwed.
-ALWAYS sign up a new tenant for 3-6 months to begin with. This gives you a relatively short trial period to make sure everyone is compatible. I did this with these people and I'm glad that was all I had to tolerate from them.

I'm sure there are 10 more things these people taught me, but these were the big takeaways.
 

RE123RE

Inspired Forum Member
Registered
I wanted to sell the lot, and asked a real estate expert what to do.
Hi,
Good example indeed. I understand you thought he is an expert. no reason to dwell on anything. can I just ask what made you believe he is a 'real estate expert'? How did he explain his suggestion/What did he say when you shared your situation with him following his terrible suggestion? Maybe ask him if he minds paying you half of the loss. Ha tell him since he is such an expert, he'll make it in no time.
Thanks
 
Last edited:

RE123RE

Inspired Forum Member
Registered
Always more expensive to put the wrong person in than carry a couple/ few months of expenses. I've learned this one twice unfortunately.
Hi,
Can you define 'wrong person'? Credit score <600? previous landlord wouldn't re-rent to the same lady?
Either or, or both? Other?
Thanks
 

kfort

Senior Forum Member
Registered
In my case, the one who's work reference seemed a little off. Same with landlord ref.

1st time, a work reference was bogus. Pretty sure it was a friend. Pretty sure he sold drugs for a living. Got out of it with $580 in damages. Covered by DD

Second time (last fall): didn't meet the roomy. Went off the girl's work & landlord refs. They were fine. Roomie was a drunk who rarely put out the blunt he was smoking inside my recently renovated ($40k) smoke free home. Got rid of them on a technicality and it cost me $722.50 in lost rent. Good news is I re-rented at a significant upgrade in tenant profile. Significant. So it'll work out.

Both of these can be chalked up to- get your system, stick to it, always.

And always meet the room mate. No matter how good the girlfriend is, meet the room mate.

It's only a mistake if you do it twice. But it's still cheaper to learn from others.
 
Top