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One Example of the Income Property Risk / Reward Tradeoff


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Here’s an interesting story for you, a true one at that.  One of my income properties is a triplex with a coin-operated laundry room in the basement (1 washer and 1 dryer).  There is a door in the laundry room that goes to the storage part of the basement, and it is obviously kept locked at all times to prevent unauthorized tenant access. 

Well, I recently found out that some punks had been regularly using the laundry room as a party house.  I probably would never have discovered this if not for the fact that I started getting complaints.  So I dropped by one early Saturday morning to check it out, and sure enough the complaints were legit. 

There were chairs down there that I had never seen before, a couple half-filled beverage bottles, a dirty ashtray, and a few other pieces of evidence.  I quickly concluded that the 16 year old kid living in Apartment B and his 15 year old buddy from Apartment A were hanging out down there with friends.  I’m sure they “borrowed” the laundry room key from their mother and grandmother, respectively, to gain access.

Upon further inspection, I noticed that these punks were getting into the storage area of the basement too.  A few items were missing, and to add insult to injury the 9-volt smoke detector batteries were gone!  But worst of all is the fact that their presence down there presented an additional liability for me, increased wear and tear on the property, and disturbed the neighbors. 

Since I could no longer rely on my tenants to treat the laundry facility in a responsible manner, I decided to block their access.  I changed the locks, and also added a deadbolt lock to the internal door leading to the storage area as an added precaution.

Although I lost the laundry income, the amount lost is tiny when viewed as a percentage of the total rental property’s monthly income.  I’d much rather give up the $20 or so per month than to place my investment property at greater risk.  It simply isn’t worth it, and as such I made the correct decision.



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