1. Assuming one has read tons of books, listened to podcasts, asks questions to mentors, ect.....what part of being a property owner took you by surprise once you pulled the trigger?
The propensity for tenants to leave piles of crap behind that the landlord has to deal with.
2. Being an out of state landlord, are you happy with your PM? What kind of due diligence did you complete to find them?
3. How do you stay in touch and have a good relationship with a contractor or handyman in the area when things need repair?
Never had a long-distance PM or service contractors - I was only out of state once and I tried to do it without them. DON'T. :D
4. Could you give examples of your horror stories? Ever think of just getting out? Why?
First try as a landlord: bought a shitty old house in Chickasaw, AL, fixed it up and lived there on savings after getting out of USAF. I couldn't find work in the Mobile area so I moved 350 miles north to Huntsville soon after. Our friends next door got evicted because their landlord wasn't paying his mortgage, so it seemed like a win-win to have them rent our house.
WRONG.
A few months later when they moved on to something nicer, they left the place a disgusting mess. I was newly divorced, cash-poor, and working two jobs, living a day's drive away, so I came up with the bright idea of offering a couple months free to whoever would clean it and fix things up for me. I will never know everything that happened, but the guy turned out to be a major druggie (probably the reason why he was dropping out of college and leaving the dorms). He had a lot of friends living there with him. They had underage girls over. They stole shit around the neighborhood. They melted insulation off wires on the back porch (so much for my outdoor carpet). They got caught breaking into the public pool to bathe because the water was turned off at the house. I didn't know all of this yet, but when I asked him (via email) to start paying or leave, they totally trashed the house - knocked out drywall, broke fixtures, etc.
Soon after, I made the same deal with a family that had roots in the neighborhood, and they did OK with repairs, but he got laid off and they had to leave after only a couple of months of actual payments. The next tenant also did some decent work but blew me off every time I tried to ask when we'd get to paying rent. The worst part was, he kept answering my emails for months after apparently moving out (the only part I truly resent... that lying asshole). While the house sat empty without my knowlege, all the pipes (which I paid $8000 to install) were stolen. So was all of the wiring.
I eventually did a deed in lieu of foreclosure when facing major pay cut, and walked away from the whole disaster. All in all, I paid that damn $354 mortgage for almost five years, lived there about 3 months and collected rent for 6 or so.
Ever think of just getting out? Why?
No, because I know it all works out in the long run. By the time the clusterfuck described above had played out, I had made a lot of progress renting out rooms in my house, and had learned a lot about what not to do. I knew it could be done right and I wanted the passive income and the tax bennies. I'll never go back.
5. What was your biggest mistake?
See above... lol
To my answers above, I will add: always write a lease, keep all your receipts, log all your mileage, and get familiar with the tax code. Never assume you know everything and always keep learning more!