Rental Properties: The End of a Chapter

In 2020, we bought our first rental property. This year, we will be selling all of them and we will no longer be rental property owners.

But our foray into rental properties actually started long before 2020.

In 2014, we bought our very first starter home. It was a fairly big house, set up on a hill, with a ridiculous amount of steps leading to the front porch. We bought it cheap from the old couple who had built the house, and boy did it need a TON of work. We ripped out carpet, painted wood paneling, took down drapes and weird half spindle walls, and slowly but surely built the house into a home. The last project we tackled was the unfinished basement. We transformed that damp, asbestos littered space into a little apartment complete with a bathroom, kitchen, bedroom, living room, and separate entrance (that Theo dug and build by himself with a shovel hahaha). We listed it on Airbnb, and even though it was only about $35/night (my, how times have changed!), we started making enough money from it to pay our mortgage. I did all the cleaning myself and we LOVED having an apartment in our home for guests and for the Airbnb.

After three years of this, we decided to sell our house and move into a tiny rental home. We knew we could sell the house for much more than we had paid for it, and we wanted to put that money into a down payment. Not for our primary residence, but for a rental property (or two, if we were lucky!).

Although none of that went exactly to plan, in the end we did sell our house and lived in a rental for ourselves while putting the spare cash into a down payment for a rental property.

We bought our first rental in March of 2020. Yup. That was…interesting. We quickly painted and flipped almost the entire house ourselves, all with three small children running around (Ezra even stuck a screwdriver in a socket one day). The timelines gets a little bit blurry from there, but we put in an offer on a second house right across the street and also began flipping that one, redoing almost then entire kitchen and painting the whole thing.

Even now as I’m typing this, I’m not sure how we managed to do all the work on top of regular jobs and family life. It was a very busy season, I will say that!

We got a tenant in one of the houses and the other house became an Airbnb and missionary housing. One day when I was cleaning the Airbnb, I looked out the window and saw a “For Sale” sign on the house directly across the street. We quickly looked at the listing and knew we wanted to purchase that one, too. Problem was that we had no more money for a down payment. Theo quickly called up some friends who were looking around to invest their cash in something, and onboarded them into our rental property business. They put the money down for the down payment, and we would manage the property. We agreed on a split of the profits.

By 2021, we had five rental properties in our portfolio! We fully owned three of them, and we split profits on two of them. Theo managed all of the properties himself, and it worked out perfectly since we lived in the same neighborhood as the houses.

In 2022, our lives changed dramatically when we found the sweetest five acres just seven minutes from our school and decided to move out here to the country. This meant we were 30 minutes from our rentals.

Spring of 2023 was big for our family- Orion arrived in our family and Theo took a second job as a school resource officer. During the school year, he works his full time job and then spends two out of three of his days off working at the school. When we added in all the time he spent managing the rental properties plus me working part time and trying to run a homestead, we realized that this is just not sustainable for our family. It’s not healthy. We CAN do it all, but something will be lost or sacrificed in the process…and we are growing concerned that this will be our kids or our family. And no amount of income is worth losing that.

We thought long and hard about just hiring a property manager, but the numbers just weren’t adding up. We looked at the numbers of how the current economy is operating and realized pretty quickly that all of our properties have gone up significantly in value, and we stand a chance of recouping all of our costs and hopefully making a little bit of money if we go ahead and sell now.

A lot of people ask if owning rental properties is a good business. Our answer is a resounding YES. While it’s not a good source of short-term/immediate income, it IS an incredible long term investment. As long as we had good tenants in place, managing the properties was fairly straightforward and the income truly is passive (meaning that we aren’t doing a ton of up-front work while still making a decent amount of money in the long run). The mortgages were all being paid by tenants, and we still highly recommend rental properties to anyone who is looking to invest.

We truly are sad to say goodbye to this chapter in our lives. I don’t feel like the chapter was long enough or we were really planning to end it this way. It’s bittersweet for sure. But the bottom line is that our family time and Theo’s and I’s capacity is more important than any financial or portfolio achievement, even if it does make good business/money sense.

As of right now, two of our properties are under contract with closing dates in the next two weeks. One property needs to be cleaned out and then it will be listed, and the remaining two will be listed in the fall.

Maybe one day in the future when we have a little less on our plates, we will look into owning rental properties again. But for now…goodbye rentals. You taught us SO MUCH, built our work ethic and we are sad (but also so relieved!) to see you go!

I think I need to split this blog post into many other topics because this is getting way too long, so stay tuned for some blog posts answering your questions on these topics: