Renters...Really?!?!?
Posted by MLW (+185) 10 years ago
I am not trying to be rude with this but....Why is it that everyone with a 3+ bedroom house for rent charge an arm and a leg per month? We are NOT all oil rich!!! There are decent Miles City resident families that are in need of homes but cannot afford $1,000+ per month. We are hard working, non welfare families with good earning jobs but again are NOT oil workers making that kind of money!!!

We are looking for a minimum 3 bedroom house for our family. We have 2 kids and a 6 month old baby and would like to find a bigger, nice home for rent or rent to own at a decent, more realistic price!!! If anyone has information please call me at 406.852.3418 or message on here. Thank you!
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Posted by Richard Bonine, Jr. (+15076) 10 years ago
Pretty simple... it's called supply and demand. Right now demand is much great than supply.
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Posted by Anns (+117) 10 years ago
Look at the posts...... supply is VERY HIGH where is the deamnd for LOCAL????
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Posted by cubby (+2646) 10 years ago
I'm not trying to be rude either, but what I don't understand is why are everyone paying that much to rent a house? Most of the rentals out there are charging more for rent then what I'm paying for a house payment. If it's because of credit then I don't want to hear it. You can get your credit back in order.
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Posted by Dark Beer (+259) 10 years ago
Look at the posts...... supply is VERY HIGH where is the deamnd for LOCAL????


Ummm... the supply of 3 bedroom houses in the $600-750 range is low.
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Posted by Levi Forman (+3718) 10 years ago
Put yourself in the landlord's place. If you owned a house and had people willing to pay $1000 a month for it, would you rent it out for $500?
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Posted by Matt Smith (+788) 10 years ago
What is a fair price per month for a decent 3 + bedroom home with a pet allowed? Nice Neighborhood.
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Posted by Grim Reaper (+77) 10 years ago
My 3 bedroom costs me over 900 a month to own. I wouldn't rent it for less than a grand.
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Posted by t.anderson (+107) 10 years ago
I was just about to post the exact same thing that Levi posted.It is true, why would a landlord rent for less when they can make so much more? I know it is frustrating to those who are desperatly searching for an affordable rental.
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Posted by ocne (+471) 10 years ago
Not to get on a soapbox or anything, but this is what its like in Sidney and Williston (worse in Williston actually). You can't find a regular old 1-bedroom apartment in Sidney for under $750/mo, much less a 3-BR house.

Finding places to rent in MC has always been difficult. If you think its bad now, be prepared for it to only get worse if/when we get more oilfield activity here.

That said--I sympathize with you. I know what its like. Hang in there and hopefully something will work out. Keep talking to people, anyone, because you never know when someone might have something or at least a connection to something for you.

And to those suggesting buying, I agree that you might as well if you're in a situation like this, if its possible. I'm in a situation where i would love to stop wasting my $$$ renting and buy. However, there has to be places to buy first...not always a simple thing. Even for folks with great credit--especially a single person--finding a house that is in decent condition and afforable in this town is difficult.
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Posted by RA (+642) 10 years ago
One fallacy of the thought that 'why should a landlord rent for less when they can charge and get more' is that same line of thought COULD be the same regarding charging double the fair price for a gallon of milk, a loaf of bread, or a gallon of gas by retailers in Miles City.
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Posted by Amorette Allison (+11902) 10 years ago
Retailers have raised their prices in the oil field towns. Folks from Sidney and Glendive are coming to Miles City to shop because the price gouging hasn't hit here yet.
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Posted by Richard Bonine, Jr. (+15076) 10 years ago
Retailers have raised their prices in the oil field towns. Folks from Sidney and Glendive are coming to Miles City to shop because the price gouging hasn't hit here yet.


Umm... let's be a little bit careful in assuming/accusing retailers in Sidney and "Hell" of gouging people. I am sure the cost of their labor has gone up. It probably cost typical c-store $12/hr for labor. The price of everything in the store has to go up to maintain the margin.
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Posted by spacekace (+889) 10 years ago
Try renting in a "big town". When I lived in Bozeman, you would pay at least $1000 for a 3-bedroom anything... If you wanted something newer (which was probably a little apartment or condo) you were paying at least $1200 for a 3 bedroom. If you were approved and accepted by the landlord or rental company (which you have to pay a fee for the application) you had to pay first months rent, last months rent, plus a security deposit which equaled one months rent. If you had pets you had to pay an extra $200-$500 per pet security deposit (sometimes non refundable) or a monthly $75 pet rent!

I understand that Miles City is not a big city, and you should be glad that you don't deal with what others have to. By the time landlords pay mortgage, insurance, taxes... $1000 is very reasonable for a 3 bedroom HOUSE.

Instead of throwing the rent money out the window, why not become a home owner... At least your cash will be going towards something that benefits you. And as someone mentioned previously, if you have bad credit and can't buy a home, I think you have no right to be bitching about rental pries.
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Posted by Richard Bonine, Jr. (+15076) 10 years ago
And as someone mentioned previously, if you have bad credit and can't buy a home, I think you have no right to be bitching about rental pries.


That is a pretty calloused judgmental attitude. There are many reason why a person might be in a less than stellar financial situation, through no fault of their own.
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Posted by Amorette Allison (+11902) 10 years ago
True, Richard. I know no one can find help in Sidney, to the point the fast food places close during drive-through hours and the wait can be long for food. Still, it is very hard on the regular citizens, who will probably be there after the boom goes bust, to have to live through the boom prices.

I haven't rented since married student housing so I have no clue what rents are these days. My house payment is way under a thousand a month but my house is also not something most people would rent!
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Posted by Wendy Wilson (+6171) 10 years ago
Three words: Free Market Economy.
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Posted by Levi Forman (+3718) 10 years ago
When I was in California, I paid $1150 a month for a 1-bedroom apartment, and that was in the suburbs. In the city it was more like $1500. Always wondered how the McDonald's employees lived in that area.
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Posted by Steve Craddock (+2737) 10 years ago
To those suggesting buying as an alternative, it isn't always a smart long-term, especially for those who don't know if or when they will have to move to another town at some point.

Big corporations who transfer personnel usually have a program where they will buy the transferred employee's house if it doesn't sell quickly or the prices drop. Everyone other homeowner is "at-risk" when it comes to selling their real estate. If you get laid off, you're still on the hook for a mortgage. If you move to take a better job elsewhere, you have to make double payments (rent in the new place, house payment in the old) until it sells.

The American Dream can easily turn into the American Nightmare under these conditions, as millions of good people recently discovered. Rushing into home ownership to solve a short term problem is rarely a wise thing to do over the long haul, especially in a boom-town environment when prices rise dramatically and then fall precipitiously overnight. I've seen it happen time and again (Gunnison CO in the 70s, Grand Junction in the 80s, Austin in the 90s, and just about everywhere in the last 10 years.
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Posted by J&J (+348) 10 years ago
If you are laid off wouldn't you still have to pay rent?
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Posted by Steve Craddock (+2737) 10 years ago
Perhaps. The point is that if you are renting and get laid off, your obligation to pay rent ceases when you vacate the premises (assuming you leave the place in good shape and resolve any outstanding lease issues, which is usually easy to do for circumstances beyond the tenant's control, such as being laid off). So that leaves you with options, such as moving in with relatives or finding a cheaper place to live until the situation improves.

If you have a mortgage, that obligation stays with you and follows you everywhere you go. And if you aren't able to pay it, it has major financial consequences that will last a long, long time.
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Posted by Michelle Miller (+21) 10 years ago
I think a $1000 for a nice 3+ bedroom is perfectly reasonable rent, based on my mortgage payment for my very small 3 bedroom that you'd probably turn your nose up at. I often wonder if the people who complain about the rent prices have ever owned a home. The homeowner not only has to pay the mortgage/insurance/taxes, etc, but they have to have money put aside for the inevitable repairs and fix-it-ups. On top of that, they're not renting their house out for charity - they're going to be putting some money in their pockets too.
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Posted by mckee (+383) 10 years ago
I have several rentals and only charge $400 a month for my 2 bedrooms and $925 for my 5/6 bedroom. obivously I don't charge enough but my renters have all been with me for a long time. I get at least one call a day from someone looking for a rental, I feel bad when I tell them I don't have any vacant.
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Posted by MTgal (+146) 10 years ago
I agree with McKee. Much more important to get reliable, long-term renters and make less $ than have a revolving door. I have rentals in Helena, and we charge less than the market bears in order to keep good renters who won't tear the place up.
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Posted by kcu (+297) 10 years ago
Sorry, there is no "long story short" with this topic...

No disrespect intended here but I've seen enough posts that I think this is warranted- some of you will appreciate it and of course the usual negative comments are expected but unfortunately this is apparently not just my opinion ...

So if I'm doing the math right on a recent post on the classified section of this website...that would be for a 2 BEDROOM TRAILER HOUSE

1st mth $650
last mth $650
deposit $250
lot rent 1st mth $190
total.................$1740???? And that is only if you are not required by the trailer court to provide first and last also or it would be another $190...just to move in. Are you kidding me? My 5 bedroom 2 bath house payment is $700 (including taxes, hazard ins and flood ins) so for those of you with a $1000 mtg on a 3 bdrm house I do feel for you, must be awfully nice houses.

Subsequent monthly rent $840.00 plus utilities? I just read on one of the(scared to mention... POOL forum) that Miles City's per capita income median was about $15,876 (@ $7.63/hr 40hrs/wk)and that is only if you are an employee that GETS A STEADY 40 HOURS PER WEEK which is not likely here in Miles City- doing the math that does not include taking out the mandatory taxes leaves $1250/mth income- remove from that the mandatory taxes and you are left roughly $960 take home pay. Even considering for a minute that the property has been completely updated (which is almost a certainty that it is not) with proper insulation, siding, insulated skirting, new windows, energy efficient furnace and the like, I'm only guessing that the utilities are probably about $100 to $200 per month depending on the season so average of $150.00? You factor in the fact that in order to keep that 40hr week job you must have transportation therefore you MAY have a vehicle payment, therefore you should (oh yep another touchy subject for some) have vehicle insurance and gas money and presentable clothing to wear to that job. God forbid you have a child or two to have daycare expenses because you would make too much money to be able to qualify for daycare assistance.

$990.00/mth from $960.00/income??? Sorry...there is something that has to be said about the human race...they must eat! So even removing from the equation the food, vehicle payment, insurance, gas, clothing and child daycare you are still -$30.00 per month to live in this 2 BEDROOM TRAILER. So therefore you are looking at needing TWO full time jobs in order to rent a 2 BEDROOM TRAILER HOUSE and cover all other NECESSARY expenses. !!WOW!! No wonder we can't afford that pool. Maybe the gal looking for funding ought to be contacting the landlords of this community for funding the pool!

Or the other alternative is, WELFARE!!! Yep I said another word that everyone loves to hate on MILESCITY.COM! And I'm sure that all you naysayers will have a field day with it but before you do, do the math yourself before you head up another forum on our nasty little "welfare queens". I know plenty of "men" out there that are utilizing the welfare system or that play their part of the result of a mother having to utilize the SYSTEM. All that energy you may want to spend on me educating you of the reasons behind the use of our Welfare System please spend writing letters to your senate and governor that have the power to change it because complaining to me or about my opinion is useless- it may make you feel better but all in all is still useless. For those of you that need assistance on where to start with that:

Governor Brian D. Schweitzer
Office of the Governor
Montana State Capitol Bldg.
P.O. Box 200801
Helena MT 59620-0801

Senator Max Baucus
222 N 32nd St Ste 100
Billings, MT 59101
(406) 657-6790

The US Dept of Health and Human Services only funds these programs but they are strictly monitored by the individual states by the people that you elect by voting- if you don't vote your voice is never heard. Just a food-for-thought moment.

So our "community" families are suffering at the hands of whom? Sadly it's our own community. Who suffers the most when a child has no parental supervision because the parent(s) are forced to work multiple jobs outside the home in order to simply pay the rent? I'm not talking lazy here people. Which system "our community" or "welfare" is the rightful failure? Our SYSTEM provides for a family those necessities that our "community" takes away from them. And it's the children of our community that ultimately pay the price for those short comings. Ah yes, the product of our society that everyone is ashamed to admit had a hand in. We should be so proud.

I realize the "free market economy" but really? Miles City is not Sidney, Glendive, Baker, Williston, Bozeman, California or any of the other "high income" communities that are plastered all over this website (or we could afford that indoor pool and spruce up our parks a bit) where the citizens are capable of paying the same rent prices that this free market economy is causing some to think that's what they can get- not just yet. AND THANK GOD FOR THAT- HAVE YOU SEEN THE CRIME RATE IN THESE TOWNS!!!! And if this is any indication of what our community can expect with the anticipated "oil boom", our community is totally doomed and so not ready for the repercussions. It will be an enormous BOOM!!! Our housing issues are nothing new; Miles City has always had a housing shortage problem that now will only get far worse. But without remaining rational about it our beautiful town will be left nothing but a rundown, filthy ghost town when all said and done. The landlords will have collected all their high-end rent for their rental property and because of the higher income tax bracket that money throws them into, none of the money will go back into the homes (just look at them now) because...yep you guessed it...property tax reassessment which means pay more property tax also. They are going to want to keep what they can- right, line their pockets- right? And what will happen, when the boom resides and everyone moves on to Arkansas or wherever the oil takes them? The money is all gone, the properties are all run down, and everyone is still obligated to pay those higher taxes. Great!!! I Can't Wait.

With this mentality do you seriously think that when this does really hit our town that the landlord of rental house that your parents or elderly grandma and/or grandpa is living in isn't going to see the almighty $cha-ching$ and find a legal way of getting them to move out so they can collect that $double$ rent? Our elderly will have no place to go because everything is already overpriced for them on the fixed income they receive. It is as simple as this (does this sound familiar to anyone yet)..."Oh gee Mrs. So-N-So...I know you are 79 years old and make $850 in social security but I'm raising the rent to $1000, which will no longer include the utilities, water or garbage and well if you can't figure out how to pay it I expect you will be moved out within 30 days?" It is already happening people!

When the accountability to rebuild our community begins, whom will you hold responsible (got to be those lazy welfare queens (kings) right?). Where do you even begin with that topic? Ahh yes...history always repeats itself...it was good while it lasted blahblahblah..if only our city fathers would have done things differently blahblahblah...if only we all knew where that money went blahblahblah...sippin' a cold one, bellied up at the Bison Bar...

I hope to the good lord above that I am totally off base with where this great community is headed. I choose as McKee does. Prefer long term here-to-stay renters rather than fly-by-night-seat of your pants transits. Good luck to you all "free market economy" supporters as I'm sure I will be excused as your flock heads south. Totally here today gone tomorrow but you are correct that everyone is entitiled to their own opinion...at least until you post on this website that is.

Ok well it has now taken days to get the time to say what I wanted to say, so now off with my head! I sincerely apologize to those critics that will get noting more out of this other than the opportunity to scrutinize my spelling and grammar, tell me to head back to school, the how dare you's, you talkin' to me's?, how devastatingly wrong I am, attack my ridiculous pampas-ass attitude only to remind me that I really should have just done the dishes instead of write this.
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Posted by howdy (+4949) 10 years ago
absolutely nothing wrong with welfare being used to survive if your family needs it...Sadly our minimum wage needed to be raised a whole lot more in the last few years...someone recently commented to me if the minimum wage had kept pace with the cost of living, it would be 25. bucks per hour at this point...So I agree with you that the poor need help at some point and will vote accordingly...thanks for your post...
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Posted by MRL (+86) 10 years ago
I agree rental prices are high, but that is out of our control.
We moved here in July and had an extremely hard time finding anything to rent. We (family of 5) started out in a 1 bedroom house, and were able to find a 2 bedroom place a few months later. The problem we had was trying to get someone to work with us by doing a 6 month lease.... Everyone would only do 1 year. Luckily, we found someone that would work with us- thank you Adam!
Anyways.... I think some places are worth $1,000/month... Especially if it's a 3 bedroom place! You cannot buy a nice 3+ bedroom house here for much under that for a monthly payment. Besides that, most landlords might charge a little over the actual house payment to cover damages to the home.
Also, just because people are renting it doesn't necessarily mean they have bad credit. For example, our family is here in preparation for a deployment, so we're only here temporarily.... It would be pretty silly to buy a home and sell it less than a year later. I wish we weren't "throwing money away" by renting, but we really didn't have any other choice.
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Posted by K. D. (+369) 10 years ago
I am still failing to understand how someone can pay $1000+ per month for a 3 bedroom in rent. I am paying $725 for a very nice 5 bed, 2 bath mortgage. That $725 includes the escrow. I just see these landlords as greedy, and yes I do own 4 rentals. I would rather charge a fair rent and keep good tenenats.
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Posted by Grim Reaper (+77) 10 years ago
With all do respect. Your nice, and my nice must be two different things. Four years ago I couldn't find a nice place for under 100K. Yet your mortgage would make me believe that your house must have been in the 60k price range. Did you buy 20 years ago? If so I believe it, and that really doesn't count with prices today.
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Posted by Wendy Wilson (+6171) 10 years ago
For all you landlords who are renting your units for below market value, be careful. If the IRS audits you and determines that you are engaged in a not-for-profit activity, your losses will be disallowed. Just sayin'.
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Posted by howdy (+4949) 10 years ago
Grim Reaper, they could have put down a large downpayment?? Many folks do so from the sale of their previous homes...
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Posted by K. D. (+369) 10 years ago
$90,000 sale price, $5,000 down, 5.875% interest, 30 year loan, closed the sale May 2008.

Here is a calculator if you want to figure it yourself: https://www.firstintersta...bank.com_2

Your payment will be $502.81.
Home price
$90,000.00
Down payment
$5,000.00
Total amount financed
$85,000.00
Payment amount
$502.81


And Grim, with all due respect, maybe you didn't look hard enough.

[This message has been edited by K. D. (2/7/2012)]
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Posted by mckee (+383) 10 years ago
KCU
I think you said it very well and I agree with you. I am surprised that such a small town is as expensive as it is. We lived in California for many year and yes it is expenses but the iminities are plentiful and the housing (both rental and buying) are expensive but the jobs pay very well. When I moved here a few years ago, I worked as a secretary at a company and was making over $11.00 an hour and I was a tne middle of the pay scale. Here I made $5.50. I hope that the people that really need a house can find one.

[This message has been edited by mckee (2/7/2012)]
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Posted by mckee (+383) 10 years ago
Wendy Wilson

I'd like to look up the information on below and fair market value for renting, If you could tell where to find the this.
Thank you ahead of time.
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Posted by kcu (+297) 10 years ago
Wow thanks- that was not the responses that I expected. Way appreciate that!

K.D.: I am totally with you! Thanks

REAPER: Nope- purchased our home less than 10 years ago. Believe me we searched and worked with a realtor for 3 years before finding a house big enough for our family and were still one bedroom short for our family size. Thank goodness for graduates! LOL. Our realtor's were awesome and definitely worked hard for their money with our family of 6. I bet we looked at over a hundred houses in our search.

WENDY: IRS? Is that a threat? No one said that the rentals we have are not profitable but guess it all depends on what you consider profitable? Not that it is any of your business but I will tell you anyway.it's just that the profits are put back into the homes because it's needed, not to line our pockets (or is maintenance, improvements and upkeep not allowed by the IRS). And just who determines what "fair market" is? You? I pay an accountant and a lawyer dearly every year to make sure that the rental business is ran within the means of the law- plain and simple- nothing to hide here. Some day the homes will be completely updated and the profits then will possibly purchase some more or maybe just retire (if I could remotely bring myself to charge what you think should be charged.food for later thought). A little bit every year goes a long way and the renters appreciate affordable housing AND not having to live in a dive. Are you saying that because I purchase a 4 bdrm house for $40,000 and the payment is $400.00, I'm going to prison because I don't charge $1000/mth? That the government is going to hunt me down like a dog because the rent I charge is providing sufficient profit to cover taxes, insurance, flood insurance and leaves room for future improvements or just not according to you? Did you notice that I said improvements and not "repairs"? We also require our renters to purchase Renters Insurance to illiminate those ungodly "repair" bills that some of these landlords are complaining about and using to justify what they are charging for rent. Total B.S!!! State Farm Renters insurance is no doubt the broadest coverage available for as little as $8.00/mth.
What? Because one landlord decides to charge $1000 because he/she happened to choose the wrong renter out of a pile of applications from people they have not met and have a horrible experience that costs them dearly, every other land lord MUST follow suit or we are not compliant with the IRS or just you? Is that what you are saying or am I not picking up what you are putting down? They and you for that matter should reward landlords like us for not putting the citizens of our community in the poor house and have to apply for unnecessary assistance (I simply pay enough taxes thank you). I keep our lawyer happy, the accountant happy, the renters happy to keep paying their rent on time and my banker is happy! That is what makes me happy. What is wrong with allowing people to retain that last ounce of dignity after they have hit rock bottom and not have to go buy their groceries with food stamps? Or have a reliable form of transportation (with proper insurance coverage)? Even though you seem to believe I am not doing things right by rent prices...I must say that I am extremely proud that I passed your spelling and grammar test! What a major accomplishment I was so totally worried about that.

I guess I had it all wrong...sorry folks. Don't work your ass (oops sorry webmaster) off to make something of yourself because there is always going to be "that" landlord and the "free market" supporters that because they may not have had to experience or endure any sort of hardship to need a helping hand and have a college education that they are the only ones that are allowed to prosper in society. That's deep! And that's selfish! And that's greedy! If I could bring myself to be selfish and greedy and loose my compassion for those less fortunate than I.oh wait, umm not an option. sorry guess I'm stuck just being me. No one is above me and no one is below me- whether they can spell or do math, have no kids or have six and single. Who is anyone to judge and not want to try to make a difference in someone else's life? That when our business (that is apparently not profitable enough) contributes financially or monetarily to needy families in this community, we are not worthy to the rest of our community because we don't charge enough for rent to belong to the landlord brotherhood and plaster it all over the front page of the Star to say HEY look at this family, they are so desperate! Who in their right mind would want everyone in town knowing that? Right back to the dignity! Right back to respecting others no matter their social status! Back to offering the hand that may just turn that life around.

There is nothing more rewarding than and to have renters that thank you for giving them a chance when nobody else would, giving them a nice home to live in without having to give their pets away (renters insurance, again for those that missed it...landords require it; renters get it as it protects you from them also), and allowing them and their children to have a safe (may not be for much longer) place to call HOME. Maybe I'm just more fortunate than other landlords here because I have awesome renters. Renters that WANT to raise their kids here! Renters, that appreciate the opportunity to be able to SAVE some money for a home of their own someday, instead of lining my own with it. Well my make a difference speech is done. So go make a difference- you may just surprise the hell out of yourself and find you actually enjoy it. What an even more wonderful community we would all live in!

[This message has been edited by kcu (2/8/2012)]

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[This message has been edited by kcu (2/8/2012)]
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Posted by howdy (+4949) 10 years ago
what do you mean about the State Farm renters insurance?? Would be interested in learning more about that...what does it cover for instance...I believe Wendy, who is an accountant, was just trying to be helpful with her advice...she is wonderful, during tax season particularly, with her helpful advice and is known to have a kind heart...
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Posted by kcu (+297) 10 years ago
Are you really asking me that seriously? Renters insurance is not only protection for the renter as far as liability and personal property coverage but also provides the landlord with a policy that protects their property from the damages left by irresponsible or neglegent renters. State Farm last I checked still has no REAL restrictions of dog breeds so is perfect for those of us that allow pets.

So say the renter falls asleep on the couch and accidently kicks over the candle on the table at the end of the couch and the candle wax goes everywhere and ruins the carpet. The policy would pay the damages less the $500/deductible. Also protects the renter in the same aspect...so say the renter moves in and notices that there is candle wax all over the carpet, tells the landlord- landlord acknowledges but does nothing. Renter goes to move out and landlord tries to blame the ruined carpet on the renter- the landlord knowing he has a renter policy files a claim against the policy- insurance company determines that the renter did not ruin the carpet and the landlord pays for the new carpet on his own- renter covers nothing and moves on with life.

In the event of a fire no matter the cause without renters insurance there is absolutely no coverage for the personal property of the renter.

As far as Wendy, thanks for the info I will keep that in mind. As "some" others have often said here about not being able to hear the tone of voice you are using. Those "some" people sometimes make the same mistake.

[This message has been edited by kcu (2/8/2012)]
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Posted by howdy (+4949) 10 years ago
Yes, it was a serious question as I always thought renters insurance was only for renters themselves not landlords...good to know...

I certainly hope your condescending "tone" wasn't meant that way...
You mentioned "tone of voice" but you are coming across as wanting an argument or something...Hope that isn't the case...
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Posted by Mary B. (+195) 10 years ago
I agree with Grim. K.D., I challenge you to find a "very nice" five bedroom home for $90,000 today. Everything in that price range of any size needs a lot of work. Two and three bedroom "very nice" homes are running $125,000+. Though "very nice" is all relative.

Kcu, Wendy is a C.P.A. and was giving very practical advice. There was nothing snarky in her post. You chose to read it that way. Your response to her was way over the top.
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Posted by Grim Reaper (+77) 10 years ago
K.D.: Ok now add escrow, and tell me what your payment is. I was including taxes, and insurance.
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Posted by Mary B. (+195) 10 years ago
Also, K.D., investors do not get 30 year mortgage terms because of the increased risk involved. 30 year terms are for owner-occupied homes. Check out what a payment would be on such a house with a 15 year term. Makes a real difference.
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Posted by Marcy (+596) 10 years ago
Just FYI, when you purchase a rental income property you are required by the lender to put down 25% (If you are honest with your lender about it being a rental). So when you add it all up,(mortgage, taxes, utilities, insurance, upkeep on the property, etc.) the landlords aren't 'gouging' the renters, they are barely making a profit, if at all. It takes a long time to recoup the initial costs of having rentals. Now obviously, the more you have the higher the profit margin, but for those who only have a couple the rent prices are high to cover the costs.
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Posted by howdy (+4949) 10 years ago
and a 15 year loan vs a 30 yr loan adds on about 50% more to your payment...so a 800 per month payment ends up costing 400 per month more...Big difference to a landlord...
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Posted by kcu (+297) 10 years ago
I did not mean to sound condicending sorry howdy and sorry Wendy.

As for the insurance question I was just very surprised that some are not as informed as others. Talk to an agent and it doesn't have to be State Farm as I believe all companies carry this coverage, (some just not as well as others) and see for yourself what benifits as a landlord you would be protected with. Also there are policies out there that are called Rental Dwelling Policy which I would have to say State Farm also provides the broadest coverage per policy and are way way way less premium that a regualar homeowner policy. I may not know alot but I do know a few things about insurance- check your policies check your policies check your policies!! There have been a few fires lately- talk to your agent, ask them what your policy covers and how much it would cost you if that were your property. Not worried about claims? Increase you deductibles for a couple year. If you were to do so, there is a great possiblilty that within 2 to 3 years you will have saved enough to cover your deductible- so increase it again. Your propety should not be a burden physically or financially.

If you as a landlord have the property covered under a regular homeowner policy you are way overpaying for the coverage because you are being charged premium for things only the "home owner" would be entitled to not a renter. Rental Dwelling coverage protects just the dwelling. Renters insurance therefore is designed to protect the things that belong to the renter inside the dwelling, storage shed or storage unit.

For those landlords that have more than one rental wanting to expand, you should really discuss your options with a trusted banker. There is no reason that you cannot use the combined equity in the exsiting rentals for the 25% or larger down payment on another or if its paid for, use the entire property as collateral until you are under the required equity in the home needed to refinance and refinance it. I'm not cerified to give financial advise so I am stopping there with simply offering know how for those that don't know that would like to know.

There are so many options for you when you ask the right people. If it is ran as a business and the income from your rentals are reported as income there should be no problem. The money is there for the banks to lend it, do not believe everything you hear but you can believe that, build a relationship with them and let them help you figure out how to make you and them more money because that is their business and they are good at it.

The old saying...where there's a will...there's a way.


Grim and Mary: I think based on the figures that K.D. was referring to my mortgage and his mortgage as we both have 5 bedroom homes and our payment are in the $700-$725 range. I could be wrong...
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Posted by Mary B. (+195) 10 years ago
Which means for an investor at a max term of 15 years, and most likely a higher interest rate than owner-occupied, the payment would be what?
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Posted by K. D. (+369) 10 years ago
My earlier post had this:
I am still failing to understand how someone can pay $1000+ per month for a 3 bedroom in rent. I am paying $725 for a very nice 5 bed, 2 bath mortgage. That $725 includes the escrow. I just see these landlords as greedy, and yes I do own 4 rentals. I would rather charge a fair rent and keep good tenenats.


I have a 2 loans: my personal mortgage for my personal $90,000 home, and a buisness loan for my rentals.

The rent I recieve goes towards monthly and yearly bills for the rentals, and improvements for the rentals.

I looked for 5 or more years till I found a house I was happy buying. I did not say it was easy or was immediate. I agree, the prices people want for crap houses is horrible. Just keep looking and ask around is all I can say.
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Posted by Cheryl Pieters (+480) 10 years ago
My in-laws can rent their 1 bedroom, 700 sq. ft. condo for $2,000 month up here. Meanwhile, in the same area, our 3 bedroom, 2 bath homs with gi-normous yards cost less than $1400 in mortgage payments and property taxes. In this market it definitely makes a lot more sense to buy (hopefully you have good credit).

When we have rented out a house in the past to people with a bunch of kids, there has been some damage. I know that not all kids take color crayons to the paint or drive their toy truck into the wall and create a hole in the drywall, but enough of them do to make renting to families like yours not very profitable in the long run. On top of the high rents you probably can't afford, you also have to compete with adults who want the house and more than likely won't even be in the house that much as they work long hours.

I would imagine that the land prices haven't gone up as much as the rents. In addition, Miles City has some very fine homebuilders. Have you thought of buying a piece of land and having a house built for you? If you are going to stay there for a long time, that would make much more sense (I don't imagine the oil fields are going to run out of oil any time soon).
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Posted by Mary B. (+195) 10 years ago
Cheryl, it costs far more to build a house here than to rent or buy existing.
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Posted by kcu (+297) 10 years ago
No the land value itself has not increased but the location of that land has new flood regulations so a majority of the available parcels you can't build on anyway unless you want your front steps 3 to 4 feet off the ground. Therefore Miles City has very few options to expand for residential purposes. Even existing run-down homes that would be best to be torn down is not an option in most of Miles City due to these new regulations. You can only fix it up and that is only to a certain extent- you just can't replace it. So it is real unfortunate for Miles City that the dyke was not made to code when the money was there to do so. I for one would probably not opt at this time for a 1% tax increase for a public pool but I would definately opt for a 1% or even 2% tax increase (as long as it was capped and unable to be tapped for any other purpose of course) for the dyke! Just think how much more profitable owning a home or rental property would be without the extra burden of Flood Insurance! I would gladly trade the sum of my flood insurance premiums which is about 4x what I would be subjected to with the 1% tax, for 5yrs or 10yrs if I knew I wouldn't have to WASTE it for the next 30-40 years!

Anyway, that is a very good idea though because even with the cost of building a new home the insurance premiums are about half if not more for newly constructed homes compared to say an existing home that is 40+ years old- which would in turn help keep the payments slightly more affordable. Ever wonder why your home insurance is more than that of the neighbor across the street for pretty much the same size home? I hear it all the time. Maybe his house was built 20 years ago and yours was built 60 years ago...big difference!!! That 60 year old home is more likely to have an electrical fire, bursting pipes and sewer problems just to name a few because of the age of the home so its a relatively higher risk therefore cost more to insure. Kind of the same thought process as insuring your 17 year old kid to drive...but the more precautions you take as a parent such as requiring your kids to get good grades (B avg) in order to get behind the wheel, complete the course for the youthful driver good driving discount, insuring both your home and auto together for the multi-line and multi-car discounts, it all adds up. Your neighbor's 17 year old without those discounts is paying far more guaranteed than your 17 year old with them. Reduce the risk-Reduce the premium. Update your older homes to reduce the risk- you are rewarded with a reduction of premium and your home is a much safer place to live. Attack the unexpected before it attacts you unexpectedly. Tons of ways to save that hard earned dollar out there you just have to ask. There are enough professionals on this site that would be able to point you in the right direction just ask and someone is bound to answer- be it Ammorette, Wendy or whomever. This is simply too small of town not to work together for the greater good of everyone.

[This message has been edited by kcu (2/8/2012)]
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Posted by Wendy Wilson (+6171) 10 years ago
kcu,

I wasn't being snarky or implying that you were doing anything nefarious. I appreciate your apology and apologize in turn for causing you any anxiety. My comment was intended to remind folks of the possible problems with "being nice" in the rental world. Taxes are all I think about this time of year so I have a bit of tunnel vision.

mckee,

You can go to the irs.gov website and search for not-for-profit activity. You should find some information about it. Also, there is an IRS publication specifically on rental activities that also discusses the issue. I believe that you can download it or order a paper copy for free.

And to set the record straight, I'm not a CPA or an accountant, really. I'm an Enrolled Agent who prepares tax returns for individuals. But you can call me Sensei.
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Posted by Mrs. M (+716) 10 years ago
Wendy, I thought you earned your law degree, are you a tax attorney?
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Posted by Wendy Wilson (+6171) 10 years ago
Yes, I earned my degree but I'm not a practicing attorney at the moment. I'm not a tax attorney. I'm an attorney who happens to do tax returns. Tax attorneys don't usually prepare tax returns.
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Posted by Mrs. M (+716) 10 years ago
Thanks from your old neighbor across the street. Actually saw your mom the other day. We talk about doing something but neither one of us gets across Main. LOL
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