This page is dedicated to the worst among us; the unscrupulous landlords who milk a property without concern for tenants, neighborhoods or their own long term interests.
The roof leaks: "Humm, I thought I fixed that."
The toilet leaks : "Put a towel around it."
The front steps are broken: "Use the back door."
There are no screens for the windows: "Maybe you can buy something at K-Mart."
Can I have my security deposit back: "Oh sure, I'll be in touch."
There are three ways to benefit financially by investing in rental housing: Cash Flow, Appreciation and Tax Shelter.
Most good and scrupulous investors try to maximize their return on investment by taking advantage of all three possible benefits. They do it with financial and tax planning, careful purchase of each property, good property management while they own it, then professional marketing when they decide to sell.
However, there are short sighted fools who rape neighborhoods and steal money from a property by chasing cash flow with no thought to the long term ramifications. As a sad result, slumlords destroy buildings, neighborhoods and seriously impact the lives and hopes of poor tenants and their children. They also miss a chance to make a decent profit while building long-term financial security by investing intelligently in rental housing.
Typically, a slumlord looks for an opportunity to buy a structurally and aesthetically challenged property for little or no down-payment. That kind of deal is all to often available from someone who bought something that was fairly decent, but then "milked" and mismanaged the property until they can no longer stand to deal with the maintenance problems and the kind of problem tenants you get in a problem building.
A slumlord is happy to take over any junk property they can get cheap, with little or nothing down. Why not, they don't ever intend to finish paying for it anyway. Their whole goal is to put the least amount of money possible in a property and take the most they can out of it - for as long as they can. A slumlord is not usually concerned about tax benefits, because they try to collect as much of the rent in unreported cash as they can. They are not concerned about appreciation because they intend to abandon the property when it has been finally milked dry.
When a tenant moves out and leaves a mess, a mainstream landlord cries, cleans, repairs and repaints. Then they try to do a better job screening their next tenant. A slumlord just lowers the rent on a trashed property until some poor soul will take it as is. Then it's the same scenario with the next tenant, and the downward spiral continues until the cash dries up from the last desperate tenant willing or forced to live in squalor.
It doesn't take many derelict buildings to take down a neighborhood. A bad neighborhood leads to more slumlords and more abandoned buildings. The cancer continues to spread and always will unless and until someone stops it.
Government will. They pass new expensive and burdensome laws. They level old neighborhoods and build public housing, that evolves into ghettos, eventually worse than what was there. Or we can help. We in the business of providing decent, safe and affordable housing at a profit, must educate the short sighted fools who chase a quick-buck while sacrificing a better long-term return. If they won't learn, we must ostracize them, and help government to weed them out. However we must be forever vigilant because government is always inclined to take over the entire garden instead of just digging out a couple of bad seeds.