As the holidays came and went, we were still anxiously waiting for our deadbeat tenants to move out. Although they initially said they’d be out by the end of 2017, closing on their house was pushed to early January and they set up movers for January 10. On an almost daily basis, I was fighting an internal battle with myself to not storm over there and curse them out for screwing us out of 2 months rent. Continuously, my more reasonable mind prevailed as I kept reminding myself there would be absolutely no good to come out of that. Sure, I might feel better, but they surely wouldn’t move until they had trucks to clear out and somewhere to go, and in the meantime, they would have surely ‘accidentally’ bumped and broken quite a few things on their way out the door. Surely, the best course was to wait until they were finally out, assess any damage, and then decide if it might be worth a lawsuit.

In the meantime, I had this nagging feeling that the house would be in bad condition. I kept telling myself that new paint and carpets were always in the cards for a 9 year rental for a tenant with dogs, and I hoped it wouldn’t need too much more than that. The last time I had been to the property was a few years ago, after they they had lived there for four years, and everything was in good condition. A slight pet odor was detectable, but none that wouldn’t have been remedied with the planned repaint and new carpet.

Finally, January 10 came, and it was time to go see the property. After weeks of avoiding me and delayed return calls, my long-term tenants had been in regular contact over the last couple of days and even invited me to come to the property while they were packing up the truck. In my current state of mind, knowing that I might blow up and that there was nothing I could do to change where I was now, I declined.

As I walked up the driveway, I started taking inventory of things that were wrong. The garage trim had five different exterior light fixtures screwed into it around the perimeter. Why on earth would they feel the need to install so many lights pointing into the driveway? I explicitly stated in the lease they were not permitted to make any changes or install anything without approval, but here I was looking at this mess on a nice 4 bedroom house in a relatively new development. The driveway was starting to crack and needed a topcoat; no big deal. Approaching the front door, I noted multiple scratches on the painted front door and that they had switched out the original brushed nickel deadbolt with what had to be the cheapest lock available from the local Home Depot.

Taking a deep breath, I unlocked and opened the front door with a key the tenant had left under the front door mat. I was thankful to have taken that deep breath of relatively fresh air since I was about to need it. My next breath was saturated with what was clearly a blend of pet urine and feces. I had admittedly smelled worse in a couple of potential investment properties, but those I quickly walked away from; this time, I was stuck. I walked directly through the foyer and kitchen to the sliding patio door at the back of the house. As I tried to open the door to get a cross-breeze going, I realized the handle had been replaced with one that clearly did not fit at all and couldn’t be locked, but was still bolted in place with gaps all around and slightly crooked. Oh, and the hinged safety bar that had come with the original door? That was missing and the tenant had placed what appeared to be a sawed off broom handle in the door track on the floor.

Now outside and standing on a gravel patio, also installed without my approval or knowledge, I looked around the back yard, taking note of a couple busted-up dog houses, pots of dirt that presumably housed plants at one time, and some miscellaneous debris and trash cans left behind. Speaking of the makeshift patio, don’t get it confused with an EP Henry stone patio that would have certainly fit the neighborhood. This one had been constructed by anchoring a perimeter of 6×6 railroad ties, filling it in with coarse gravel, and haphazardly placing a few busted up pieces of flagstone on top. Yes, it looked as shitty as it sounds. Walking back toward the house, I noted the wooden steps leading out of the patio door to the patio had been gnawed on by dogs and the wood handrail was loose… add that to the list.

Walking back into the kitchen, my eyes were shifting back and forth rapidly in a chaotic dance, taking in all the disturbing sights. Seemingly, the corner of every cabinet, trim, or wall that was exposed had been chewed on by their dogs. Even above ground level, most corners and even the corner of the formica counter-top had been broken off or cracked. I imagine they must have made it a weekly ritual to don metal plate armor and get drunk or stoned since without the plate armor I would have expected blood stains to accompany most of the damage. There had been some attempt to correct a few of these issues, presumably also in a drunken state, through the use of drywall mud applied with a shovel and oversized galvanized nails to reinstall trim. The cabinets didn’t stand a chance of fixing since they were builder grade, particle board construction, and had been gnawed on, pissed on, and water and/or urine logged. The tenants also installed a very nice (sarcasm) soap dispenser beside the sink, removing the sink mounted spray nozzle and installing an off-the-shelf bottle of soap with the white plastic nozzle above the sink and the reservoir bottle below; fancy! Looking up to the ceiling, there had obviously been a water issue in the upstairs hall bathroom since there were multiple water stains all across the ceiling! There was a little hope that whatever water issue had been resolved since none of the stains were damp or recent. Glancing down, there were a few small tears in the kitchen vinyl floor, and the heater vent was heavily corroded; odd for a vent that was less than 15 years old, unless animals had been… never mind.

Making my way into the attached family room, it was more of the same. A half wall showed obvious attempts to repair damage to the trim, but clearly my tenant had dusted off the shovel again to apply drywall joint compound before slapping on a coat of not-quite-matching white paint. The carpet had multiple stains, obviously from animals, and the door leading to the garage was scratched up, presumably by angry pets wanting to leave; can’t say I’d blame them. In the garage, a few dog crates had been left behind and the urine smell was even worse out there. The tenant had installed (again, without my consent or knowledge) two of the cheapest ceiling fans money could buy, and the wood steps into the garage, much like those outside the patio doors, had been gnawed on by some very hungry dogs. There were a few stains on the floor, and the garage door opener wouldn’t work since the wires to the sensors had been chewed through. Thankfully, there was a manual release so I could raise the door and get some ventilation. Back inside on the first floor, the formal dining room and living room were very much like the family room; stained carpets and gnawed trim everywhere. In each room, they had decided to paint an accent wall, which you might consider okay assuming you’re into glossy paint in very dark colors. I have to assume that was the crap leftover in the bargain bin. At least the water stained ceiling issue was limited to the kitchen.

Making my way upstairs was, surprise, more of the same… stained and smelly carpets and random dings in the drywall. The pets seemingly got their fill of painted wood trim downstairs, because the gnawed trim issue seemed to disappeared up here. Evidently though, they again found a purpose for their plate armor; to crash into doors. Three of the interior doors upstairs had broken hinges, holes, or both, and the bottom edge of one door, I would find out later when I removed it, was coated in small chunks of dog feces. Again, more shitty attempts at repair… a patch in one of the bedroom walls looked like it was made with ducttape rather than joint mesh and compound, and then covered with glossy paint. In case you’re not aware, glossy paint makes poor quality repairs stick out like a turd in a punchbowl. There were two bathrooms upstairs, and both had the same issues. Water logged and stained cabinets, heater vents with pitting corrosion, and walls seemingly painted by a ten-year-old from their favorite color palate. They were kind enough to leave a few busted windows screens and a broken sash also.

Hell, where do I go from here? I’ve got this property that’s only 14 years old, but in shitty (pun intended) condition, and I’m already deep into work on two other houses; my current residence in the process of being renovated for sale, and my new house originally bought to flip but being upgraded to move in. Honestly, the idea to simply walk away and let the bank have it entered my mind more than once. I certainly didn’t need another project and I didn’t think the money we needed to sink into it would be recuperated. We needed to go home and figure some things out.

When we thought the tenants would be buying the house, we had asked $245k, which was inline with comparative sales (comps in Realtor speak) for that neighborhood. When the tenant hesitated at that price, I agreed we might be able to do $240k, at which point they said they’d talk to the mortgage broker and let us know what they could do. Had the house been kept nicely (like we had seen during our prior visits to the property), it would have been worth $245k, but in it’s current condition, we would have been lucky to get $180k! There was a larger foreclosure in the neighborhood with a bunch of upgrades that had just sold for $185k, so we knew we were screwed given the current condition. Although we didn’t have quotes yet, we didn’t expect the work needed on the property would exceed the $60,000 difference between current and repaired condition, plus we expected the house would be worth more than the original comp of $245k after we did a renovation. Yes, we had to go all in on another project!

I ordered the largest dumpster I could get and had it scheduled to be delivered. I put together a list of repairs we knew the house needed, and set up appointments with three local contractors for quotes. That Saturday, my wife and I returned to begin cleaning out the prior tenants belongings that were left behind and start gutting the place. Carpets, cabinets, countertops, interior doors, bathroom vanities, and toilets all went in that dumpster. We left the appliances that we had purchased 14 years ago since they were still in good condition, but pretty much everything else went.

Within two weeks, we had begun purchasing replacement doors and materials to rebuild the bathrooms and kitchen, and we had received our quotes. As is typical, quotes were all over. One of the three bowed out, saying he was too busy, and the other two quotes came in at $7500 and $12000 just for labor. This would be in addition to the materials we had already begun purchasing, and eventual carpeting the upstairs bedrooms, and repainting the whole house, ceiling to floor. Thankfully, a contractor that had been working at my current residence came to the rescue. I went over the list with him and even gave him an idea of the quotes I had received, and he said he could do everything on my list for about $4000! I couldn’t spit out “yes, please” fast enough!

Having the majority of the labor contracted, we could start lining up additional contractors for carpets, painting, and powerwashing the exterior. Before he could even start work though, we first had to have the subfloors varnished to seal in any staining and prevent odors from coming up through the new flooring. I knew a painter that we had worked with before, and he offered to help us out since we were screwed so bad by our tenants. Rather than giving us a lump sum cost, which is usually inflated to cover some unknowns, he agreed to do the job on a time and materials basis. As he got to work on sealing the sub-floors throughout the house, we continued buying materials and scheduling delivery. A few thousand dollars later, we were set for our contractor to rebuild what had been destroyed once the subfloors were ready.

Getting them started allowed the Mrs and I to refocus on what would become our new home, specifically, finishing installation of the kitchen cabinets. A couple of weeks later, the painter had finished sealing the floors, and our contractor got to work rebuilding the bathrooms and kitchen that we had gutted. I hired a contractor to powerwash the exterior of the house, and waited for the call that our upgrades were finished. Of course, its never quite that easy. Since we knew this contractor and he had an understanding of our standards, we were getting calls every now and then with additional things he found that we might want to do. He knew us well! The suggestions included rebuilding the upstairs bathroom subfloor, replacing a lot of trim rather than painting over it, rebuilding the patio and garage stairs, and installing a bunch of new hardware including door hinges, switch and outlet plates, and door handles. Everything he suggested, we agreed to. While this ended up costing us another $3000 or so including materials, it was well worth it and we ended up with a much nicer finished product.

About six weeks after the tenants had vacated, we were ready to schedule the granite countertop installation, painting, and carpet. A couple of weeks after that, the countertops had been installed and painting was done, and my wife and I visited the property during the carpet install to take inventory of where we were and list anything else needed. Other than some landscaping, we were happy with the finished product. There was literally not a hint of pet odor in the house and it looked beautiful!

Despite using typical builder grade materials, everything had been modernized. The main level was finished with luxury vinyl plank flooring, modern white cabinetry with new stainless hardware, granite countertops, and a subway tile backsplash, and it was freshly painted in a light neutral beige. Upstairs had all new wall to wall carpeting and was painted a darker shade of the color used downstairs. Most light fixtures and hardware throughout the house had been replaced, and it looked like a brand new home! We couldn’t believe it!

We scheduled a maid service to come in and give it a good cleaning since there was a lot of dust from the construction, and we took care of the minor landscaping ourselves over the next couple of weeks. Once that was done, we took some photos for the listing, and put it on the market.

All told, we had put about $25-30k into the house. With my wife being a Realtor, she looked at comps and to our surprise, she thought we might get that investment back out. Eight days after listing, we had an offer in hand to sell for $271,500. This was $31,500 OVER the price we had agreed on with the former tenants and more than it cost us for all the upgrades!! You want to talk about dodging a bullet??! I had completely snoozed on this rental for a few years, walked into a complete shit-hole mess when they vacated, completely renovated it, and was able to escape ahead of where we had been if everything went smoothly and according to original plans! I still feel like pinching myself!

I’m not delusional enough to think this is normal, and I know we got incredibly lucky. While I went back and forth numerous times about whether to sue my former tenants for every dime I could get, once the payday was had, I was happy to walk away. Laws are generally written to be more favorable to tenants rather than landlords. I understand this; some landlords are complete douches and the tenants are in an unfavorable position to go up against someone that may have millions of dollars worth of properties and resources to hire a really good attorney. I certainly don’t think I fit in the douchebag category; I forgave a couple late payments under extenuating circumstances and was just a regular guy with one (or two) too many houses. We were ecstatic to have come out ahead of where we would have been financially and be free forever from the headache of our former tenants. Besides, we basically got paid for a great education and learned an awful lot about logistics and nuts and bolts of residential construction as well as a lot about ourselves.

For instance, did I really want to deal with rentals at all in the future? Hmm…