My Tenant Just Trashed My House | The Aftermath

What's up, you guys? It's Graham here. So, this is certainly not a video that I wanted to make, but as somebody who's been in the real estate industry for 14 years, it's only a matter of time until eventually you come across a situation like this.

So, I'm going to walk you through one of my properties that was recently left in complete disrepair, and then I will explain where I went wrong, what I could have done better, and how you can make sure you never find yourself in a similar situation. Or, if you're just curious what happened and you have no intention of ever owning a rental property, keep watching all the way through to the end because I'm about to drive there right now to check it out.

All right, here it is, the moment of truth. All right, we are seeing it for the first time, and I don't know if there's any electricity, but yeah, wow, yikes. Is there any electricity? Please? All right, so we got no electricity here, but as you could see, wow, there is just so much stuff everywhere. I'm probably going to have to turn on the light.

Here's the living room. As you could see, these are the floors that were installed about 10 years ago, and they actually look to be in okay condition. Pretty dirty. The walls though, what happened? I don't know. Look, they have a whole bunch of these just completely stuck in the wall. Nothing was really taken care of at all in here, it seems like, and they just left so much stuff.

Here's the kitchen. The good news is that it does seem as though once everything is removed, it might actually clean up, but let's see what's through here. Oh, jeez. All right, before we continue with the rest of the home, let's explain how we got here.

This is a property that I purchased back in 2012 as a bank-owned short sale after saving up my commission for 4 years as a real estate agent. Back then, nearly a third of all homeowners were underwater on their mortgage, and this was no exception. The seller had purchased it at the peak of the market in 2005 for $230,000, only to sell it 7 years later for about $770,000.

Now, when I bought it, even though the bones of the house were fantastic, it wasn't exactly turnkey. So, I spent every last penny I had remodeling it, fixing it up, redoing the floors, repainting the interior, fixing the landscape, and then I rented it out. That very same tenant was here for 10 years, but all of this was not the result of normal wear and tear.

All right, I'm going in with the iPhone light. Oh man, it just keeps going. Wow, wow, wow, wow. Oh jeez. As you could see here, I mean they just left everything behind. There's food, just an entire wardrobe of stuff. It is unbelievable how dirty the place is.

Now, here's the garage. Let's see what's through here. Now, before we finish up the rest of the tour, admittedly, I was likely too easygoing as a landlord. I mean, after 10 years, I considered the tenant to be a friend. We were on fantastic terms, and I would have done anything I could to help out. I've even mentioned before that I've never once raised rent on this property despite the market rate today being almost double from what I was originally charging.

But I just thought to myself, I've never had a single issue; I rarely ever have a vacancy across my entire portfolio. It's easy to manage myself and hey, if they move out in the future, I could rerent it back at market rate, and then everything will be good. How do they have this much stuff?

Okay, let's see how the bedrooms are doing. Going to close that. Let's walk through. Okay, so we got a whole bunch of cans. What about through here? Okay, yeah, look, there's stuff in every single one of the cabinets. Let's see what's below here. Oh wow. Oh my gosh, even the pots and pans, stationary items.

All right, now let's see the bedrooms. I wish we had some electricity just to get an idea. So we got a closet. Let's go down. Let's start with this bedroom. Oh wow. So I have a feeling most likely what's going to have to happen is that all of this stuff is going to have to be removed, and then the entire property will likely need to be repainted.

Let's see if they've left some. Yeah, look, they, yeah, yeah, there's stuff in here too. Here's one of the bathrooms, another bedroom. Again, they just left a lot of stuff behind.

I'm not looking for any sympathy here whatsoever because I'm sure the tenant had their own struggles that I can't even begin to fathom, but deep down, I'm more disappointed because I did really care about the person who was living there. And I show you this as the reality where sometimes things like this happen even if you end up doing everything right.

I've never once met a real estate investor who hasn't had at least one of these situations happen over the span of their career. That's why it's always ideal to budget for the worst but plan for the best, and this is an example of doing exactly that. So just for some context, I'll throw up some pictures of what used to look like before.

And you know what? I mean, it comes with the territory, and I got to say I had absolutely no idea that the property was reduced to this condition. Thankfully, the floors look okay. I don't know what this stuff is though. Is this going to come off? H, that's baked on there.

Yeah, see I have absolutely no idea what that is, but hopefully, this will be able to clean up. Look at the grout, by the way. This grout used to be white and now it looks black. What is that wire? I'm wondering if they removed maybe a smoke detector without me knowing?

Wow, yeah, look, it looks like they've taken down the smoke detectors. And I remember, by the way, going to Home Depot 10 years ago buying this, bringing it from the place, and having the contractors install it.

Now, in terms of how much this is going to cost to fix, I'm guessing a few thousand for trash removal, a few thousand for paint, another few thousand making sure everything is in working order, a few thousand in lost rent, and then I'm selling it. This is something that I've wanted to do since the beginning of the year, but given the circumstances, I haven't been able to list it as quickly as I would have liked.

But now that I could get this fixed back up, I think it's time to let it go. The fact is, since I no longer live in California, it's begun to make a lot more sense to sell off a few of those first few properties and then move that into something else. Perhaps it'll be in Las Vegas, maybe it'll be a commercial rental property, or maybe it'll go back into index funds.

But I got to say, even with a management company, owning a rental property is not truly passive income, and it requires a consistent amount of work if you're expected to be successful at it.

So, in terms of what you could do to avoid something like this happening, here's my advice. Oh wow, all right, this is probably the worst of it. Wow, so they ended up leaving a lot of items over here as well. I see a refrigerator on this one side; I see a couch at the very back of the backyard. I also see what looks to be a washer or a dryer just over here, some kids' toys. I have no idea what all of this is.

All right, now in terms of how you could avoid this happening to you. First, I think a lot of people paint home ownership as a fast way to make a lot of money. And don't get the wrong idea because it can be quite profitable, but it comes with the risk that something can happen. That's why it's so important to always have a home emergency fund equal to 3 to 6 months' worth of your home's expenses at all times.

That way, you're not coming out of pocket for any damage, lost rent, or anything else that comes your way. Second, understand that it's going to take work. I've been in a position where I both managed properties myself and hired a property manager, and even with the property manager, there are still issues that come up every now and then where I need to be involved.

It's not a huge deal, but it's also not a business where you could just hire things out and then sail off into the sunset doing nothing for the rest of your life ever again. And finally, third, with higher returns, usually comes higher risk.

Admittedly, I was not charged anywhere near the amount that I should have, and even though it's okay to accept below market rent for the sake of finding a great quality long-term tenant, it's still a business and there needs to be a middle ground between being able to treat people generously but still being able to run it like a business.

But it's a lesson that I could carry forward, and I'm able to talk about all sides of real estate here. So, if you're not already subscribed, now is a pretty good time to do that. Again, I say all of this to show you the reality that investing in real estate isn't always rainbows and sunshine.

I think it's easy for people to get carried away talking about all the positives of building wealth without addressing that situations like this do happen and that needs to be accounted for, of course. Don't take this the wrong way because I wouldn't be here today if it were not for real estate; it's how I got my entire start.

And sometimes it just comes with the territory. But I've always done my best to show all sides of the equation, whether it be a renovation that goes way over budget, a property that doubles in value, or a duplex where I haven't had a single issue.

So hopefully this gives you a better understanding of the good, the bad, the ugly, so that way you could be better prepared for whatever might come your way. So with that said, thank you so much for watching. As always, feel free to add me on Instagram. Thank you so much for watching, and until next time.