Hillbilly laundromat, trailer park, low-end landlording

This guy’s YouTube channel is fun and informative. He’s a real estate agent in southern Ohio who started with nothing and buys and rents properties–but not high-end, high-rent properties. His content blew up on social media after some of his tenants started sharing his videos of hin being sued, shootout at the hillbilly trailer park, catching thieves in the act, etc etc.

They’re mostly done in a concise livestream format. He can’t believe a lot of the stuff that people do. He talks through the acquisition and rehab costs, what he charges for rentals and why, and often asks viewers “is it worth it?”

He live streams coin collection at his laundromat, and shows video of vandals caught in the act of destroying a vending machine. He’s very transparent about costs and stress associate with owning this type of business.

I’d like to own some rental property going into retirement. Videos like this, I feel, give me a bigger picture. It’s not a bed of roses.

His channel is called Investment Joy https://www.youtube.com/channel/UCTz8K5TMmkQkRArybXfoVDg which takes you to his page with a 1 year update on the laundromat at the top of that page currently. Videos about his other properties are all over that page.

Landlords or wannabe landlords–what do you think of his videos? Can it really be this bad? Or is he highlighting some extreme cases?

With the virus and the rules 100% in favor of renters there is NO way I’d be a landlord today. It was not my cup of tea a few years back and it is worse today. One of my renters bailed owing my around $10K. I told them I’d settle for $2500. They filed bankruptcy rather than pay me. Others also bailed owing and I just wrote it off because it would cost more to chase it than I’d get back.
One of our agents has a client with a unit of about 40 apts. 18 have not paid rent for 6 months. This is just one of his properties. Best guess is that once evicted they will do what my renters did and he will lose the property in foreclosure if he can’t make up the difference.
We get crazy stories in our office about how people constantly game this system and screw the owners. I believe there are more good people than bad, but the bad are dragging down they system too quickly. It will be interesting to see how the foreclosures impact the market once the flood starts.

Covid is going to cause a lot of issues. People who can pay are not paying because they can’t be evicted.

Luckily got my properties, we have not see large scale defaults. Everyone seems to be paying as they should. A few asked for deferments but would work out a payment plan.

My business partner has commercial retail. He’s taking a beating as they all want concessions.

[quote=“Wintermute, post:3, topic:5045”]
Covid is going to cause a lot of issues. People who can pay are not paying because they can’t be evicted.[/quote]

This is what really made 2008 much worse than it should have been with owners. Why should I continue to pay for my $1MM house when I could buy my neighbors house for $500K?

I can see this being a real big issue. Especially with the small business and restaurant business. Just think about all the businesses like recusants, salons, tanning, entertainment, etc. These places have been destroyed. So many of these small business that line the shopping strip malls are getting crushed.

When it comes to restaurants, I would typically take the family out 1-2 times a week at a cost of $60-$80. About once a month I would take the extended family out at a cost of $100-150. We easily spent $400-500 per month dining out. We have only been to a dine in twice since march and that was while in vacation in Florida. I can imagine that this is similar story with many households.

There is a small mom pop sub shop down the street from my office near downtown. Downtown is probably in the 30-50% of normal occupancy. They only operate for walk in lunch crown and open from 11-3. They are likely done for. My company has survived so far, we will see what happens under Biden. I recently reviewed our corporate lease and sent options to the CFO on using the situation to decrease our floor space and or get concessions on rent escalations. We occupy about 1/3 to 1/2 of the entire building floor space and have been the bedrock tenant for 25+ years. There has already been one company fold up in the office building. Of the other companies in the building they have been very sparse since march. Id say, 10% or less of the normal headcount in the other companies in the building. It has been nice from a parking standpoint, but I can imagine the building owners are worried about their future. I know the building owners, and this is their only commercial real estate. They basically have their net wealth tied up in this one building.

Our city relaxed their off sale codes for liquor during the pandemic.
I was ordering from our local brew pubs at least once or twice a week just to try to make sure they were able to stay open.

The taco place by my condo in Chicago is suffering. 90% of his business is gone.

To follow up on my comments above.

Today there was a cop car in the parking lot of the office building. This is unusual, but there was a car there yesterday as well. I talked to the maintenance worker in the parking lot and he informed me that there is a planned layoff at the engineering company. Back in June, there was a round of layoffs in the building and there was a threat that happened and there was a cop at the building for a week.

Right before Christmas is a $hitty time to do a layoff but for some reason, many companies do it. As far as the office building goes, there are vacant floors from prior layoffs. My estimate is currently down 16%, but with this current layoff and them consolidating their floor space, it will be somewhere 21% to 35% vacancy. I am not sure if there is still a mortgage outstanding, but if so, the monthly payment cannot be scaled back 21-35% because your clients tenants have filed for bankruptcy.

Just a general question… If your employees are working from home, how do you lay them off? Call them into the office and say, please bring you computer and bring a box to get your belongings? Do you first make a virtual backup of the computer, then wipe the computer clean and call them and say, you are laid off and just keep the computer?

TBH, that is probably the safest and most cost effective.

Real estate is overpriced so you are not apt to get a good deal. Plus residential eviction moratoriums drastically increase the risk.

Commercial renting is sure a lot easier than residential, but then again it is hard to get bargains on buildings except shitholes like the burnt-out areas of Minneapolis.