Our First Rental Property: Lessons We Learned, Regrets We Had, and What We’d Do Differently

In 2021, my husband and I bought our first rental property and officially launched our property management LLC. I had saved up a large down payment from years of traveling for work, and we were excited to finally invest in something that would (hopefully) pay us back for years to come.

What we didn’t expect was just how much of a rollercoaster our first investment would be—from moldy crawl spaces and attic infestations to pool repairs and surprise renovations. But in the end, we learned more than we could’ve imagined—and somehow, we still came out ahead. We are now looking into expanding with another property. This time, knowing a lot more than we did the first time.

The Beginning: Why We Bought and How We Funded It

My husband and I met in college and both went through the same MBA program where we had to write business plans for our final thesis. During the time of planning out the business plans, we developed our own personal business plan on the side: property management. Years went by, planning and trying to figure out how to fund our dreams. We tried to find investors with little luck. Unfortunately, real estate investing is in fact one of the businesses you definitely need some kind of cash on hand before beginning. We were recent graduates with student loans and no liquid assets.

We set our dreams aside and went into the work force. We tried all we could to save money but it wasn't until I landed a corporate level travel job where we were finally able to actually save anything. I feel extremely blessed to have been able to accept a job that paid me to travel the US, while paying for literally all my expenses. My job comped me for my food, rental cars, gas, travel and paid me a very decent salary on top of it all.

I traveled 3 weeks out of the month, while my husband worked his job at home. We were able to save basically everything I made from my job. After a couple years, we finally had enough to purchase our first rental property. It felt like we were sacrificing time together to eventually have some financial freedom.

It was 2021, we knew that the market was most likely going to get worse before it got better so we were determined to get into the market before we could no longer afford it. We had no time to waste. So we found a home within our price range, in a nice area of town and we put in our offer. We skipped the inspection because the house looked great. The people had lived there for over 20 years and taken great care of it.

They accepted our offer, assuring us they would be available for any questions we had about the house or... the pool in the backyard. Turns out, they lied.

The Reality Hits: What Went Wrong

Our first dose of reality was when we couldn't figure out how to get to the water heater. We even hired professionals who said it was installed backwards and was completely unreachable (to this day I still don't completely understand). We reached out to the previous owners to see if they knew how we could access it. Crickets. They weren't returning our calls or texts.

Our only option was to replace it because it had begun to leak. This wasn't even a week into owning the home. Luckily, we had some funds to purchase a new one and replace it. We got a new one installed quickly.

Thanks to the water leak, we checked out the floors. Unfortunately, it looked like the water heater had been leaking for some time because the crawl space had... mold. And lots of it. Ugh. Now we had to bring in another professional to remove the mold and place a dehumidifier in the crawl space because we ALSO learned we are in a flood zone. We did both, but now we were starting to regret not getting that inspection.

A month passed and we finally got a tenant in the house. The mold was gone and everything was safe. Spring turned to summer and it was time to open the swimming pool. Something we were excited to have quickly turned to regret, again, because the swimming pool was old. So old, in fact, many pool experts we had look at it had no idea how to open or close it. I'm not kidding. We tried reaching out to the previous owners again, just to ask how they used to open and close the pool. Again, crickets.

Eventually we got it opened and cleaned. But it did cost us way more than expected because we had to hire someone.

A few months passed with no issues but suddenly our tenant called us to let us know he was hearing odd noises in the attic. We immediately sent someone out to check into it. There were animals in the attic. Bats, raccoons, birds.... We now needed to call animal control and replace all the insulation in the attic. We did, but again... another expense within just a couple months of purchasing this house.

Months went by and we thought we were finally out of the expensive part of all of this. Until a storm hit and wrecked the siding on the outside of the house. Luckily, it was covered by insurance. But, the thought of having yet another major expense almost wrecked us.

Months went by again and we got yet another call from our tenant that the toilet was not flushing. So we had to send out a plumber. We seriously braced ourselves for the worst. Luckily, the tenant had just clogged the toilet so she agreed to pay the plumber's bill.

As summer rolled back around, the pool now had a torn lining and needed a new water pump. Great. Luckily, we knew a guy to help thanks to our previous problems.

The Financial Side

We expected to purchase the house and have very minimal repairs, considering the previous owners lived there and we were told they had kept great care of the house. We even met them before putting in our offer and they emphasized that they loved living there, raised their kids there and were upset to have to move. So, we figured that there would be no real issues with the home. Worst case, we figured there might be some cosmetic issues we needed to fix. We had no clue there would be so many expenses immediately.

We took out a loan for the crawl space, and we were able to finance the attic with the professional who did the work.

As for the pool, we are basically paying a monthly fee for the upkeep, the cleaning and the opening and closing. We also had to spend thousands of dollars to repair the lining and replace the water filter. We are on a payment plan for this as well.

After having the loans for the crawl space and attic for 3 years now, we have officially paid them off! We were using our cash flow from the tenant's rent to pay them.

Currently, we are cash flowing about $500 a month thanks to the tenant's rent. She will be in the house for one more year and we are hoping she stays. If she does not, we will have to find a new tenant which took about one month both times we had to find one. (We've had 2 tenants since 2021). Therefore, we are planning to have enough money saved up for 2-3 months of mortgage payments just in case she moves out and it takes longer than expected to find a new tenant.

The Silver Linings

I know I've talked a LOT about the negative sides in this investment. However, we do have some silver linings. The house is in a great location. It's in an affluent area, very close to a popular shopping center and mall. It's also in one of the top school districts in our state. Therefore, when we do need a new tenant we have had lots of applications. We are also hoping for some appreciation on the home itself if we ever decide to sell it. We are glad to have a cash flowing home where we're also building equity and long-term wealth.

We also learned A LOT from this experience and know what mistakes to avoid. Or at least... some mistakes to avoid. We haven't learned everything.

We have been blessed with some great tenants so far. Our first tenant paid on time or early every single time. He also left the house looking better than he got it. Our current tenant seems great and we were happy she was wanting to sign a 3 year lease. That gave us immediate peace of mind.

What We’d Do Differently:

• Always get an inspection! We could have avoided so much headache if we had known we were going to need all those repairs upfront.

• Budget more for unseen repairs. We had money saved up but simply not enough for immediate large repairs.

• Vet contractors carefully. One contractor quoted us extremely outrageous numbers. After calling around, we realized he had a reputation for overpricing everything.

• Understand seasonal maintenance needs (like for the pool). We knew the pool would come with some added maintenance needs but didn't think about it needing repairs immediately.

Final Thoughts: Would We Do It Again?

We absolutely would do it again. Looking back, we made some rookie mistakes—like skipping the inspection and underestimating how much repairs would cost—but we also took a big leap that taught us invaluable lessons. Our first rental hasn’t made us rich (yet), but it’s helping us build a foundation for long-term wealth. It has provided us the confidence to try again. We are keeping this rental while looking into options to purchase another property. Our goal next is to find a multi-family property OR to do the BRRRR method. I'll keep you updated if we do either. And next time… we’re definitely getting the inspection.

If you’re considering investing in your first property, know this: it won’t be perfect, but it will be worth it if you’re in it for the long haul. I've created a FREE real estate investing checklist for newbies. You can download it here

I would also invite you to check out my Investing Mindset Journal (it's only $7!) you can download it here

For another great read, check out my blog post about the realities of investing here

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