This tax delinquent deal made me very happy. Post 2

Mitch Goldstein | Coach Mitch | April 23rd, 2007

Coach Mitch’s REFLECTIONS™

Yesterday, I was in the neighborhood, so I dropped in on one of my houses, just to see how it was being taken care of. The tenant was in. This was of some concern because he should have been on the job, making me rent money. You see, the tenants are one month behind.

However, the tenant was raking the leaves in the backyard. It looked great. I approved some small fixes he wanted to do. He gave me some rent money and then said that he wanted to level the basement floor. I offered to supply the concrete if he would pick it up at my house.

Today, was “clean-up the basement day.” The tenant came to pick up the cement. My clean-up helper and my tenant loaded about 500 pounds of mortar into his station wagon.

I asked the tenant if he and his friends would like to break down a wall in the basement? The interior wall was a cistern. When this house was built in 1948, rainwater was shunted into a basement cistern to be used for showers, toilets, etc. Now it is obsolete and the tenant could knock down the interior wall and significantly increase the open space. As the cistern wall holds up a load bearing beam, we need only put in some metal columns for support.

I love these kinds of projects – where the tenant does major improvements to the house – for their living pleasure and for my equity benefit. My leases provide for these situations. The tenant gets a better living environment and I get the equity buildup. In this case, a finished basement will add to the value when this tenant buys the house, which should be in about one year.

I got this house as a result of a tax delinquent situation. I will discuss how I got this house another time.

See Coach Mitch’s “Ridiculously Simple System…” ™ for details.

Safe investing,