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Help ptbarnum become a slumlord/rental property owner
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Date: April 20th, 2014 2:58 PM Author: cerise aphrodisiac double fault I've made the decision to allocate a chunk of my portfolio to rental properties. I live in TX and the economy seems good and there are lots of lower middle class types who should be suitable renters.
I started watching some of these TV shows about property, but wanted to ask people for their advice on this. For a noob like me who just wants to collect rent and do no work, should I just find a property manager and let them do everything? How can I make sure I won't get completely ripped off? |
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Date: April 20th, 2014 2:59 PM Author: Splenetic Razzle-dazzle Mother National Security Agency You're life seems so horrible (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415170) |
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Date: April 20th, 2014 3:00 PM Author: cerise aphrodisiac double fault I don't disagree. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415174) |
Date: April 20th, 2014 2:59 PM Author: sable travel guidebook Summon: Rachmiel. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415171) |
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Date: April 20th, 2014 3:04 PM Author: cerise aphrodisiac double fault how long has rachmiel been doing this? I thought he was an insurance guy (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415215) |
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Date: April 20th, 2014 3:05 PM Author: sable travel guidebook I don't know if he does or not. Years ago he tried to convince a group of XO'ers to buy houses in shitty rural parts of PA for like 5k a Pop and become legit slumlords. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415223) |
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Date: April 20th, 2014 3:00 PM Author: green bawdyhouse you are not cut out for this, abandon your plans (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415173) |
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Date: April 20th, 2014 3:00 PM Author: cerise aphrodisiac double fault ;-( (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415180) |
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Date: April 20th, 2014 3:01 PM Author: irradiated primrose native jap cr. his inclination to use a prop manager indicates this. he doesnt have the mentality of a slumlord sleazebag.
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Date: April 20th, 2014 3:02 PM Author: green bawdyhouse he also seems to have no idea how hard it is to deal with insane prole tenants (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415197) |
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Date: April 20th, 2014 3:03 PM Author: irradiated primrose native jap yep (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415212) |
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Date: April 20th, 2014 3:04 PM Author: cerise aphrodisiac double fault so there is no real good play for me here? the property manager person isn't going to be able to manage prole tenants for me without having me involved and kick me up money? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415214) |
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Date: April 20th, 2014 3:05 PM Author: green bawdyhouse do you think a property manager is going to confront a 90 IQ meth head on your behalf (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415219) |
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Date: April 20th, 2014 3:06 PM Author: irradiated primrose native jap nope. and you also have to watch over the property manager, too. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415227) |
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Date: April 20th, 2014 3:00 PM Author: demanding pit First, you're going to need to become a licensed realtor (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415182) |
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Date: April 20th, 2014 3:01 PM Author: cerise aphrodisiac double fault Do you know if it is easier for lawyers to become licensed realtors or do I have to go through the full suite of hoops to jump through? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415191) |
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Date: April 20th, 2014 3:02 PM Author: demanding pit I was half joking. But in all seriousness, just do some reading. There's gotta be tons of shit written about it. I wouldn't hire a property manager unless you're buying a whole complex or something. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415204) |
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Date: June 21st, 2014 4:16 PM Author: Fuchsia resort In texas you don't need a real estate license if you are a lawyer. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790917) |
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Date: April 20th, 2014 3:03 PM Author: irradiated primrose native jap flame (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415208) |
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Date: April 20th, 2014 3:02 PM Author: Thriller bronze french chef http://forum.mrmoneymustache.com/real-estate-and-landlording/?PHPSESSID=qtskibs11ure47to05eslj7kq0 (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415201) |
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Date: April 20th, 2014 3:03 PM Author: Misanthropic office multifamily units or single family houses?
also rent yield and rent range |
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Date: April 20th, 2014 3:07 PM Author: cerise aphrodisiac double fault I was thinking single family, ~10% yield, around $1300-1500 in monthly rent. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415235) |
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Date: April 20th, 2014 3:08 PM Author: irradiated primrose native jap the fewer tenants you have, the more risk there is. one dipshit doesnt pay you. boom. no income. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415244) |
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Date: April 20th, 2014 3:11 PM Author: Misanthropic office i would recommend aim for higher yield, lower rent, more units, preferably taking out an entire multifamily unit then having a management company is worth it
i would even recommend pooling together money for a REIT and taking out an entire apartment complex with your friends/family |
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Date: April 20th, 2014 3:21 PM Author: Misanthropic office wait you are only thinking of buying a single unit? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415321) |
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Date: April 20th, 2014 3:45 PM Author: cerise aphrodisiac double fault I was thinking of 2 units. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415474) |
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Date: April 20th, 2014 3:52 PM Author: Misanthropic office make sure they are at least next to each other if you can (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415535) |
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Date: April 20th, 2014 3:12 PM Author: irradiated primrose native jap are you handy? can you fix shit? do you know repair shit to make sure mechanics dont rip you off? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415264) |
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Date: April 20th, 2014 3:45 PM Author: cerise aphrodisiac double fault No, No and No. ;-( (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415476) |
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Date: April 20th, 2014 3:46 PM Author: irradiated primrose native jap just do index funds breh (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415484) |
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Date: April 20th, 2014 4:22 PM Author: cerise aphrodisiac double fault that is part of the problem. i have so much in equity index funds that i need to diversify away from the market. my job is also arguably highly correlated to the market. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415773) |
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Date: April 20th, 2014 4:25 PM Author: irradiated primrose native jap they get a reit or something. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415784) |
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Date: April 20th, 2014 4:42 PM Author: cerise aphrodisiac double fault have a big position there too. looking to get out of it though (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415890) |
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Date: April 20th, 2014 4:34 PM Author: Learning disabled vigorous brethren I have a lot of experience in this, and I would seriously advise against this. If you are going to buy multifamily in TX, stay at B class and above. If it looks too good to be true, it definitely is. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415831) |
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Date: April 20th, 2014 4:38 PM Author: cerise aphrodisiac double fault What has your experience been? Is the concern TX specific? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415873) |
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Date: April 20th, 2014 4:46 PM Author: Learning disabled vigorous brethren No, not TX specific (although I have specific experience in TX). You just don't understand how much work it is to be a slumlord and how stressful it is and how precarious it is when you are dealing with deadbeats.
Just remember, basically don't believe any rent roll or PnL you see. Assume it is at least 20% optimistic. And if you ever see the words "pro forma cap rate", or "cap rate once stabilized" it is basically useless.
The whole racket in C class properties is selling to people who don't know how much they suck to own and run. |
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Date: April 23rd, 2016 8:48 PM Author: Brindle Spot Perfectly said (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30334010) |
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Date: April 20th, 2014 4:43 PM Author: Fantasy-prone haunted graveyard This isn't something you can really just hop in and do on a whim. If you have big $$ you can be an investor who is outside of all the property management bullshit but when you own 2 properties you pretty much have to get involved. A property management company will bleed your profit dry without trying if you have two units. So you would at minimum need someone who knows some shit to mentor you. You can't just call a plumber because a drain is clogged/electrician to change a ballast in a light fixture. you will make no money. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415895) |
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Date: April 20th, 2014 4:48 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415917) |
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Date: April 20th, 2014 4:58 PM Author: cerise aphrodisiac double fault you mean collect the dividends and hold forever? i don't think that is going to work long term. also dividend yield on s&p isn't close to 4%. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415982) |
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Date: April 20th, 2014 5:01 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25415999) |
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Date: April 20th, 2014 5:12 PM Author: cerise aphrodisiac double fault I am extremely pessimistic on the stock market on a go forward basis and don't think we will end up with 8% nominal or 4% real returns, even over a long period of time.
Are you talking about all the fancy goblygook where they run the monte carlo simulations? I just don't think I believe any of it.
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Date: April 20th, 2014 5:19 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416113) |
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Date: April 20th, 2014 5:26 PM Author: cerise aphrodisiac double fault so why wouldnt you just buy bonds then? less volatility and more income. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416138) |
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Date: April 20th, 2014 5:28 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416144) |
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Date: April 20th, 2014 5:32 PM Author: cerise aphrodisiac double fault sorry, i meant actually hold the bonds to maturity. not trade them or hope they appreciate (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416155) |
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Date: April 20th, 2014 5:36 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416164) |
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Date: April 20th, 2014 6:00 PM Author: cerise aphrodisiac double fault Thanks for these resources and the thoughtful responses.
They way I am structuring my allocation is to use my whole life policies as my bond proxies, so I don't own any bond funds anymore. All my equity stuff is now S&P indicies. |
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Date: April 20th, 2014 5:11 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416071) |
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Date: April 20th, 2014 5:13 PM Author: cerise aphrodisiac double fault How did this do from 2007 to 2010 if you had to withdraw money for living expenses? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416084) |
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Date: April 20th, 2014 5:16 PM Author: Motley lime idiot (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25416103) |
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Date: June 20th, 2014 11:36 PM Author: cerise aphrodisiac double fault Against the advice of the board, I went ahead and did this a bit ass backwards (I wasn't really driving the bus).
Any advice on LLCs? Texas has a franchise tax on LLCs, so looks like I should probably form a Delaware or South Dakota or whatever is the hot state du jour.
Any other structuring matters that I am sure I already messed up? |
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Date: June 21st, 2014 1:51 AM Author: vivacious bipolar house generalized bond doesn't that Texas franchise tax apply to foreign entities too? if so forming an LLC in another state will merely increase your cost and complexity. by virtue of owning real estate you are doing business in the state and will have to qualify.
Texas is one of the states that has Series LLC. you should do that and create a series for each property (they were created for real estate). that way the liability is isolated but you only have to deal with one state-registered entity (and likely only a single tax too instead of a tax per entity). adding a new series is as simple as updating a schedule to the operating agreement. each series can get its own separate EIN, if you need that.
if you're doing your own management, you may consider setting that up as a separate entity that is hired by each property series llc. that way tenants don't need to write a check to "ptbarnum holding co, llc Property C series", you can pay all maintenance expenses out of one account, and remit income back to the individual series on your end. makes things cleaner and your books easier as you get additional properties. each series llc would enter into a management agreement with the management llc.
don't fuck around with security deposits. look up your state regs on where and how they need to be held, what happens to interest, how quickly they need to be remitted after a tenant vacates, requirements for the security deposit transmittal letter, etc.
read this for some tax reasons you want to use an llc and not an s-corp, and some of the things you can do with real estate: http://www.cbiz.com/page.asp?pid=8632
the forums on this site are good and you'll get much better advice here than on xoxo, and you can make connections: http://www.biggerpockets.com |
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Date: June 21st, 2014 9:02 AM Author: cerise aphrodisiac double fault This is terrific, thanks. I will read all of this stuff.
I hired a management company, trying to make this a really passive thing once it is going. |
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Date: June 21st, 2014 2:32 AM Author: unhinged theater stage Just put your money in facebook dork (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25788801) |
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Date: June 21st, 2014 9:10 AM Author: Cheese-eating Lavender Stage Have you modeled the economics and the net after-tax effective yields you'd receive on your investment versus, say, a REIT index fund or even, say, a tax-preferred fixed income investment, based on varying assumptions on occupancy, operating costs, tenant risk, etc? Obviously publicly-traded property yields are extremely low but you will need to adjust for your time/fixed costs/illiquidity/volatility/etc. Gross yield is obviously the starting point but tells you very little until you really stress test. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25789433) |
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Date: June 21st, 2014 9:37 AM Author: cerise aphrodisiac double fault Not on a particularly robust basis but more back of envelope and I think REIT is way to go if you could hedge out market/interest rate risk.
This was more of a pure asset allocation play. |
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Date: June 21st, 2014 9:45 AM Author: Cheese-eating Lavender Stage It's very easy to do in excel, I'll bet you could do it in an hour or two. It's probably worth your time if you are allocating a serious amount of money to this. I have gone through a few phases where I have somewhat considered small-sized real estate or business purchases but after running the numbers and understanding what my actual net returns would be net of my time investment, it was not very attractive anymore.
There are far easier ways to diversify your allocations than to purchase physical assets that require significant time/work.
EDIT: if you already bought the place, you can disregard most of what I've said since it's moot |
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Date: June 21st, 2014 1:43 PM Author: cerise aphrodisiac double fault What recommendations do you have to diversify allocations? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790214) |
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Date: June 21st, 2014 1:58 PM Author: Cheese-eating Lavender Stage It sounds like you are frustrated that you have too much allocated to the S&P or US equities in general. I'm guessing you're also frustrated at near-zero bond yields too, we all are. There are a lot of asset classes you can look at in the mutual fund world (non-US index funds, etc) that are at least maybe a little less insane/overheated than the US equity/bond markets.
Although you probably feel like you are above doing this, speaking to a fee-only financial adviser that recommends only low-fee passively managed index funds probably wouldn't be a bad idea. The Bogleheads community can be kind of single-minded and lame sometimes, but their general philosophy is right on for almost everyone.
Also, probably worth keeping in mind that according to plenty of studies, simple long-term allocations to the equity indices supposedly outperform even very intelligent market-timing strategies such as buying when the Shiller P/E 10 is low/selling when high.
Rather than trying to squeeze out 50-100 basis points overall on your overall portfolio performance (since I'm assuming your allocation to rental properties isn't going to be more than 10/20/30% of your assets), you might be better off just having a diversified passively-managed portfolio and focusing your time on more interesting things.
Of course, this all goes out the window if you are extremely lucky, shrewd, or a real estate genius (which 99.9% of us, myself included, are not). |
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Date: June 21st, 2014 4:11 PM Author: cerise aphrodisiac double fault I've got more a massive allocation total stock market index funds - that is now the only equity position I hold, I collapsed all my various etfs and mutual funds into the cheapest and best tracking index funds. I also have have a big allocation to whole life insurance as my bond proxy and hold a large portion of cash, which I am too conservative to ever really put in anything else.
I'm looking for something different and not really correlated or over which I have more "control". |
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Date: June 21st, 2014 6:03 PM Author: cerise aphrodisiac double fault Anything else you would recommend in addition to bogleheads?
I'm running a multimillion portfolio and need to meet some people whether live or on the internet who have experience and advice. |
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Date: June 21st, 2014 9:24 PM Author: Cheese-eating Lavender Stage David Swensen's book is pretty good, as well as "The Little Book That Beats the Market" (silly title but it is very good). I think that for most people (all the way up to a couple million in net worth), they're best off just keeping things simple through a diversified portfolio of low-fee passive index funds. Once you get up to being an accredited investor, or these days more at the qualified purchaser level, a new universe of options becomes available. But many of those are no better than, or in fact significantly worse than, a simple index fund.
It's hard to do materially better than the broader market over any long time horizon - just look at the investment management industry. There have been plenty of people on xoxo (or almost any message board) who claim/earn insane market-beating returns, and then flame out spectacularly within 1-2 years, or abruptly stop talking about their performance. Usually they are just running extremely high beta strategies (day trading, options, etc).
EDIT: How did you amass this multimillion dollar portfolio? Whatever got you there might be a decent path to continue following. |
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Date: June 21st, 2014 9:43 PM Author: cerise aphrodisiac double fault I've read all those. I was an economics major in college but for some reason never really bothered doing index funds until just recently. Now all of my equity positions are in the cheapest passive index funds and I have one large position in one stock (which I'm not interested in trading or selling), so you are preaching to the choir here.
I'm not at all interested in tying my money up in private equity or a hedge fund.
Saving money from my job is a pretty slow and unenjoyable way to make the next million, so I'm looking for something that requires less hours. |
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Date: June 21st, 2014 9:49 PM Author: Cheese-eating Lavender Stage I don't think buying rental property is a way to make money that requires less hours. Don't you work long enough hours already as a lawyer (I'm assuming you're a lawyer)? At best, you are going to do slightly better than your general investment return, unless you are willing and able to dramatically lever up and take some major risk.
It would probably be a higher-return path to figure out something entrepreneurial, whether it's making partner and building a book of business, transitioning to work for a client, or something like that.
It's hard to learn from other rich people around you, because such a huge portion of them got wealthy from starting/inheriting successful businesses when there was no major large corporate competition, bought real estate at the right time, or otherwise got ridiculously lucky. |
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Date: June 21st, 2014 11:22 PM Author: cerise aphrodisiac double fault I don't disagree with what you have said at all. But throwing another 200k into index funds just seems too much of the same and also isn't going to make me rich either. I do feel there is real diversification by doing this. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25793195) |
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Date: June 22nd, 2014 7:42 AM Author: Cheese-eating Lavender Stage I disagree (just stress test your entire portfolio for what happens in various drawdowns in equity markets, with varying choices on what you did with the 200k, and see how much that level of diversification benefits you - it's also not like correlation on all index funds of all asset classes goes to 1 in a downturn, even in something 2008-style where most equities did that).
But, assuming you are starting with one single-family home and using a management company, it doesn't sound like there's a whole lot of downside as long as you are very careful on the legal and tax side. I just don't see real upside or other benefits from doing this, other than potentially the stuff you'll learn. |
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Date: June 22nd, 2014 11:32 AM Author: vivacious bipolar house generalized bond imo the reason to get into real estate is to learn the more lucrative parts: small development deals (mixed use, strip malls), rehabs, conversions, hard money lending, etc., whatever takes his fancy, and to have the chance to meet bigger players that might get you in on real development deals (apartment buildings, commercial). if his plan is stay with residential for diversification purposes only he should just buy a REIT and be done with it. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25795239) |
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Date: June 22nd, 2014 2:18 PM Author: Cheese-eating Lavender Stage I agree with this (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25795946) |
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Date: June 21st, 2014 1:44 PM Author: Up-to-no-good fortuitous meteor cuck you gotta be careful. there are tax issues that could fuck you. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790219) |
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Date: June 21st, 2014 2:10 PM Author: vivacious bipolar house generalized bond yeah you need to find a cpa that works with real estate investors. there are all kinds of pitfalls as well as interesting things you can do. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790342) |
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Date: June 21st, 2014 4:13 PM Author: cerise aphrodisiac double fault the only interesting things i saw are the 1031 exchanges into better and more expensive property and taking passive losses against your ordinary income, though I think it phases out for people with incomes that are over 150k. any others? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790913) |
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Date: June 21st, 2014 4:12 PM Author: cerise aphrodisiac double fault What are the tax issues that could mess things up? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790909) |
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Date: June 21st, 2014 4:23 PM Author: Avocado impressive church building these will come into play when you scale (forgetting to make an election to aggregate properties for 469 purposes, being labelled a dealer and getting taxed at ordinary income, having repair expenses get labelled as improvements, etc).
if you do have another job but think you can swing it, you really should manage the property yourself to take advantage of the 25k offset. how much do make now? |
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Date: June 21st, 2014 4:25 PM Author: cerise aphrodisiac double fault 250K+ as a lolyer. I am phased out of the passive loss deduction I believe. Don't think I could make the rep that I spend more than 750 hours on real estate matters and make that my business. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790975) |
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Date: June 21st, 2014 4:27 PM Author: Avocado impressive church building it phases out after 150k AGI
another thing that going to hurt is the brand new NIIT tax. Thanks Obama! |
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Date: June 21st, 2014 4:50 PM Author: cerise aphrodisiac double fault Yeah. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25791147) |
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Date: June 21st, 2014 2:24 PM Author: Mauve institution dog poop get a duplex/triplex/fourplex
or maybe a warehouse and see if you can work a net lease, or hold onto it and hold for redevelopment in a gentrifying area. |
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Date: June 21st, 2014 4:18 PM Author: Avocado impressive church building problem with the latter idea is you can't depreciate while its not in use. he's just starting out and should stick with residential. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790922) |
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Date: June 21st, 2014 11:25 PM Author: Mauve institution dog poop True
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Date: June 21st, 2014 4:18 PM Author: Fuchsia resort Multi family is overpriced in Texas. A money is chasing Bproperties and B money is chasing C properties at this point. not a good time to get into it (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790919) |
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Date: June 21st, 2014 4:21 PM Author: Fuchsia resort Texas multifamily soon to be masterman here. Ask the seller for the books they show their tax consultant. These will tell you the worse case scenario regarding performance. They are always trying to tell a sad tell to the appraisal districts. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790940) |
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Date: June 21st, 2014 4:22 PM Author: cerise aphrodisiac double fault When do you think I can graduate to the multifamily stuff? Is the money that much better? I just own one single family house now. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790948) |
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Date: June 21st, 2014 4:27 PM Author: Fuchsia resort The best way in is to piggyback on deals. Once you get to know some folks who know what they are doing they will often let you in on a deal. There is massive risk, but it's been lucrative for me so far. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25790986) |
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Date: June 21st, 2014 4:50 PM Author: cerise aphrodisiac double fault Thanks. I have a really dumb aspie question. How do I go about meeting rich older dudes who are into this and thereby elevating my social group?
My neighbors/coworkers are all sps poors. |
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Date: June 21st, 2014 9:28 PM Author: Misanthropic office wait arent you some fancy pants lawyer? cant you just go to yr local country club? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25792584) |
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Date: June 21st, 2014 9:44 PM Author: cerise aphrodisiac double fault so i go join and then put up a sign that i am only interested in talking to people with net worth over $5 million?
there's an age issue too, it is ridiculously hard for me to talk to people over 40+ on a non-professional basis. |
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Date: June 21st, 2014 11:11 PM Author: vivacious bipolar house generalized bond i'm not him but seriously check out the biggerpockets.com forums. also let your cpa, real estate agent and lawyer if you have one (all who i assume you vetted to make sure they work with real estate investors) know that you're interested in doing deals with other investors and they may make connections for you. there are tons of conferences that you can go to and orgs to join as well, like http://www.aaplonline.com or http://www.nationalreia.com or http://www.afire.org or http://www.naiop.org (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#25793125) |
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Date: June 21st, 2014 11:22 PM Author: cerise aphrodisiac double fault I'm watching all the bigger pockets videos now and pursuing the boards. Thanks for these links.
I don't have a CPA or lawyer, I do that stuff myself for now. |
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Date: June 22nd, 2014 4:33 PM Author: slap-happy point Texas real estate is one of the few good investments out there right now. Prices are low, interest rates are low, and the economy is growing steadily.
The poster that warned you against C class and below properties is spot on. Managing those places will be a nightmare. If you can find something in a decent part of an urban center like Houston or Dallas, you'll do well over the long run. A 2-4 family property as close to downtown as you can afford would be optimal. Hiring a management company could make sense, but they'll take around 7% off the top, which could be your whole profit margin. However, over time, your rents will grow by around 3% a year and your mortgage will stay the same. You'll make a slow and steady trickle of profit while gradually building equity.
One trick I would recommend is collecting rents by credit card. I set all my tenants up through a credit card processing website that charges them rent automatically each month, and both I and the tenant get an email saying whether a given rent charge did or didn't go through. I lose around 2.5% to the cc processing fees, but I only have to intervene if a charge fails to clear or if something breaks. So long as the property is in a desirable location where you can find quality tenants, it's not that difficult, and the yields can be pretty good when you account for the benefits of leverage. It's also a good hedge against inflation, a steady bout of which could inflate away a sizable portion of your mortgage debt. |
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Date: June 23rd, 2014 1:19 PM Author: cerise aphrodisiac double fault Anyone use these sites? Looks like a Lending Club/Prosper but for real estate lending.
https://fundrise.com/ |
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Date: April 23rd, 2016 1:54 PM Author: dashing offensive dilemma MARKET TOP CONFIRMED ON JUNE 22, 2014 (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30331940) |
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Date: April 23rd, 2016 5:26 PM Author: Mahogany twisted abode Odd bump. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30333049) |
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Date: April 23rd, 2016 5:29 PM Author: dashing offensive dilemma This thread was written when Texas was booming and oil was $100. (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30333056) |
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Date: April 23rd, 2016 5:42 PM Author: Mahogany twisted abode Any word on how ptbarnum faired? (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30333112) |
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Date: April 23rd, 2016 6:10 PM Author: Aromatic step-uncle's house He's definitely complained about his investment property on here (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30333235) |
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Date: April 25th, 2016 2:24 PM Author: Sapphire Stag Film (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30343639) |
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Date: April 23rd, 2016 6:11 PM Author: Beady-eyed coral home electric furnace I have run property rentals and could make you $$$. Just need a down payment on house and ill show you the $$$ (http://www.autoadmit.com/thread.php?thread_id=2547680&forum_id=2#30333239) |
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Date: April 25th, 2016 6:06 PM Author: 180 hot plaza cumskin It's been two years. Any success ever come from this?
I'm always tempted to buy an income property, but it seems like every small scale landlord you talk to gets wiped out every few years.
Rent out a home netting $500 a month after expenses = a whopping $6,000 a year.
New roof = $20,000 +
Tenant destroys your floors = $5,000 +
Four months of vacancy = wipes out an entire year of profit, assuming you have a mortgage.
Just seems hard to actually have a positive ROI.
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Date: April 25th, 2016 6:24 PM Author: Beady-eyed coral home electric furnace First of all, you get a security deposit and hold any tenant accountable, if damage us more than sec deposit you sue the fuckhead. Second, get a condo and just pay a condo fee so you never have to worry about roof etc. In big cities places rent like a week within buying them.
Oh, and stop being a risk averse lawyer and ruminating on every thing that could go wrong. |