Profit from renting 12 Ferry

[camgarsky4]

Something random and new for Bordenites......

Hiram Harrington told the newspapers that the sisters received monthly rent of $16.50 & $14 = $30.50 for the 2 apartments at 12 Ferry. That totals for a full year to be $366 rent income. He noted that taxes and repairs ate heavily into their income and implied the net profits were not much. How much was 'not much'?

The Fall River Daily Herald Aug 29, 1891, reported city tax at $17.20 per $1,000 valuation. Andrew bought the house back from the sisters for $5,000, but I doubt the city had it valued at that $ amount. But regardless, 5 x $17.20 = $86 annual property tax cost.

As far as carpenter wages, the Fall River Globe April 16, 1891 reports that skilled carpenters could hope to earn $3 per day or 30 cents per hour for ten hours a day. So for argument sake, let's assume the sisters hired repairmen for a total of 10 hours over the course of a month and paid them 50 cents per hour, since the work was not necessarily steady. 10 hours x 50 cents = $5 per month for repairs or $60 per year.

Rent $366 less $60 repairs less $86 for taxes = $220 net profit. That extends out to roughly $4.20 per week.

Each of the sisters received ~$4 per week as an allowance from Andrew. So it appears 12 Ferry St. did give the sisters 50% more income over the allowance. Whether that was worth the landlord burden only they could answer.

On the flipside, the sisters might expect to earn roughly the same amount of money via interest. A relatively quick newspaper search (I emphasize the 'quick') for contemporary interest rates suggests 4-5% interest might be earned. $5,000 x 4.5% interest = $250 annual interest income.

So basically, the $5,000 could earn the same in interest as did owning and renting 12 Ferry St. It would be less stressful to collect passive interest income from a bank vs. being an active landlord.

Please jump in if someone has better inputs like interest rates, etc. or if my math is off. I found this interesting and perhaps how they came up with the $5,000 price tag.