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Make money as a slumlord? Okay, I got your attention, but I really don't recommend that anyone endanger their renters with unsafe housing. Much of what is called slumlording though, is simply providing reasonable housing for those with low incomes. It benefits the renter and the landlord.
Why Do Renters Want Dumps?
Tenants rent not-so-nice places because they can afford them. A house that needs paint, has rusty hinges on the doors, and a dirt driveway, cost less to buy, and therefore can be rented for less. Anything major that the landlord does to improve it results in higher rents, and possibly drives the renter away.
This often happens. A few years back my own town enacted rental regulations. The fifteen pages of new rules included many non-safety-related requirements, like a minimum of window surface-area, to allow natural lighting, bedroom square-footage requirements, and no peeling paint.
These things are done in the name of low income renters, but the result is always the same: higher rent. Add to that the regulations against mobiles homes, and low income families are moving further away from town and jobs. I mention this to let you know that if you offer an ugly, but safe and affordable rental, you are providing a real service.
Why Invest In Low Income Housing?
If a nice two bedroom house costs $130,000 and rents for $800, an old mobile home on a lot will probably cost $45,000 and rent for $500. Notice that the house costs nearly three times as much, but the rent you
You will have more risk and management problems with low income housing. Repairs will come up more often, and rent will be late more often, on average. This is why you deserve a higher rate of return on your investment. If not for the higher return, who would provide low-cost rentals?
Treat your tenants well, and make your rentals safe. Then you can honestly enjoy a good return on your investment - even if some want to call you a slumlord.