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Alternative Investing Strategies Options Trading, Day Trading, Peer to Peer Lending, Franchising, Etc can all be discussed here.

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  #61 (permalink)  
Old 01-01-2017, 08:08 PM
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Originally Posted by TexasHusker View Post
I do not but you certainly can!
How about you see if it works for you first...then let me know
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Old 01-01-2017, 08:51 PM
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Originally Posted by Outdoorsygal View Post
How about you see if it works for you first...then let me know
Actually I utilized VRBO when I managed them myself. I have heard positive things about airbnb.

Once I obtained 4 properties, I launched my own property management co. Our clients have little interest in, nor time for, keeping it with their properties.

Everyone is different on this.
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Old 01-01-2017, 08:53 PM
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Originally Posted by tripods68 View Post
It doesn't have to be 100% true, that's not the point i'm making either.

Most people that dive in real estate are not very "savvy", often learn the hard way, costing them thousands of dollars at first that they may never recoup in rental fee. Buying a property that have a lot of issue takes a way capital investments. Finding an investment that makes sense takes whole lot amount of time. Finding a particular location, zip code and be able to work with realtors in that area and negotiate a very good deal. The cost of acquiring a property; closing cost, realtor fees. Once you acquire a property how much do you want to spend to make it a to code, or renovation cost? Do you have a trust GC, or do you want it do the work yourself. How much do you want to spend to maximized the rental fee in your area? It's takes years to be an expert or be good in real estate.

Don't make it sound as easy because you say so. It isn't true. Real estate isn't for everyone that why most failed.
No return above 10% is going to be particularly easy, unless you have a stroke of dumb luck. It doesn't take years to have success in real estate or any other investment. You can be dumb as a rock and still do fine - I ain't exactly genius. Any investment requires due diligence.
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Last edited by TexasHusker; 01-01-2017 at 08:58 PM.
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Old 01-02-2017, 05:45 AM
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Originally Posted by TexasHusker View Post
No return above 10% is going to be particularly easy, unless you have a stroke of dumb luck. It doesn't take years to have success in real estate or any other investment. You can be dumb as a rock and still do fine - I ain't exactly genius. Any investment requires due diligence.
I seem to remember you didn't start out winning in real estate. You had some bad investments before you figured things out?
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Old 01-02-2017, 07:16 PM
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I seem to remember you didn't start out winning in real estate. You had some bad investments before you figured things out?
I haven't ever lost money in real estate investing.

My first rental was $150,000. It was a nice 3/2/2 house. I immediately rented it for $1450 per month I believe, and it stayed rented except for 4 various months, for about 10 years. I then sold it for $170,000.

After taxes and insurance, I'm guessing I was yielding about $12,000 per year.

HOWEVER, taxes, insurance, and depreciating are fully tax deductible. So, that put another $2200 or so in my pocket per year. So that was a total yield per year of $14,200, or about 9.5%.

Of course, I had about $10,000 in repairs over that 10 years, but I also had about $20,000 in appreciation (although in hindsight I paid too much for the house).

My total yield on that investment was right at 10%.


But good vacation rentals do SO MUCH better.

Example: I paid $210K for a cabin in 2010. I sunk about $20K into it fixing it up. Now, I overpaid about $50K for the cabin because the market crashed right after I bought it.

But...it's done about $180,000 in gross rents since I bought it. Now you have to subtract the following over that 6 years:

$6000 in property taxes
$9000 in property insurance
$8000 in various repairs and maint
$7000 for lawn care etc.
$18,000 in utilities including cable


So net rents of $132,000 in 6 years.

But keep in mind that all of those aforementioned expenses are TAX DEDUCTIBLE!!!

So...I have $48,000 in deductions, PLUS $6445 a year in depreciation deductions, bringing my total tax deductions to $86,670 for the last 6 years!

In my tax bracket, that's $26868 in tax savings, bringing my total income for the 6 years to $158,868. That's $26,478 a year on a $230,000 investment, or 11.5% on rents alone.

Fast forward 10 years, that vacation home is going to be worth a hefty chunk more than what I paid. That's almost a given.

All of that said, this is not a particularly good renter, for several reasons. I could have found one for a comparable price yielding much more, but I fell in love with this property. And keep in mind I overpaid for this house by about $50K. Had I bought it for $50K less, my yield goes to almost 15% annual on rents alone!

So I think vacation homes are the way to go. The key is picking the best market and finding one that is a top renter.
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Last edited by TexasHusker; 01-02-2017 at 07:22 PM.
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  #66 (permalink)  
Old 01-03-2017, 12:20 PM
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Do you know TH anyone whose lost money in RE? I like to listen to people who win but does anyone really lose in RE?
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Old 01-03-2017, 01:07 PM
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I've got a commercial building, approx. $400,000 investment that has been kicking me back $4000 per month clear after upkeep and expenses for 16 years now. It's a single client in a long term lease and both parties are happy with the deal. And I'm dang sure not exactly a genius either.
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Old 01-03-2017, 01:40 PM
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How did you find that sort of commercial investment? That I think i might like better than SFH and housing rentals.
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Old 01-03-2017, 01:58 PM
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I am in the building business. Encountered a client that wanted to lease a building rather than own, so built a building to their specs with a ten year lease which was renewed and in second term. Don't think I'd want to do residential rentals either but the vacation home thing has my interest.
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Old 01-03-2017, 02:43 PM
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Originally Posted by Fishindude77 View Post
I've got a commercial building, approx. $400,000 investment that has been kicking me back $4000 per month clear after upkeep and expenses for 16 years now. It's a single client in a long term lease and both parties are happy with the deal. And I'm dang sure not exactly a genius either.
That is GOOD STUFF my friend. I'd love to get involved in commercial properties at some point.

My dad has Alzheimer's and I'm taking $200K out of his estate and investing it in a vacation rental that I'm hoping will yield 15%. $30K a year income would really help pay his care.
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Old 01-03-2017, 07:44 PM
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FishingDude I know you know this already, but when you are leveraging and able to yield 15%, you can get very wealthy very quickly. Gosh I wish I knew this when I was 25!

Right now, I'm really trying to squeeze equity out of my existing properties to find and buy more good deals.

The downside - yet the upside - of vacation homes is the comparative volatility. If you are on the wrong side of that hill, you hunker down and enjoy the income.

I am hoping for a day when the vacation homes go parabolic - which they can do at times - and cash out, take my toys, and go play elsewhere.
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Old 01-03-2017, 08:00 PM
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Originally Posted by LivingAlmostLarge View Post
Do you know TH anyone whose lost money in RE? I like to listen to people who win but does anyone really lose in RE?
When you say "lose money in real estate" are you talking about people losing money on their personal homes? If so, yes. People can get upside down on a principal residence quite easily. But that's because the owner's only way to make a return on the property is buying low and selling high. That's risky.

The property owner/occupant has no chance of income from the property, thereby increasing his chances to "lose money"

Flippers can and do lose money, but the return potential is phenomenal - many are seeking a 100% return on investment for a few months' project. But every now and then they are going to latch into a loser.

People renting out property - if they are in a buy and hold situation, it is almost impossible to "lose money". But if you make a bad choice, your yield might be 5% instead of 15%, and in my book, opportunity cost is the equivalent to losing money.

Finally being a landlord is the money market account equivalent of real estate investing. That is, it is by far the least risky, thus the returns aren't as great potentially as other plays.

Real estate works because you are leveraging your one dollar with four more dollars.

Example: I buy a $150,000 house with a $30,000 down payment. I spend $15,000 on the home to fix it up, then sell it for $195,000. My return is approx 60 percent, as I made $30,000 on my $45,000 personal investment. These deals happen all the time in real estate.

In my opinion, real estate is superior to equities because of the ability to leverage. Banks will finance 80 percent or more, and the thing can't and won't crash to zero like your favorite stock can (been there done that more than once).

You can leverage with stocks through buying on margin, but it is too risky for several reasons. Been there, done that too!
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Last edited by TexasHusker; 01-03-2017 at 08:35 PM.
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  #73 (permalink)  
Old 01-04-2017, 05:59 AM
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I've done most investment stuff like this cash & carry, without borrowing money. Save and accumulate till you find a good deal, then invest. On the few occasions where we used a bank, it was for a very short term, quickly paid off.

I don't like paying interest or having much debt hanging over my head, even if the return is much better than the interest I'm paying. Things can change or go wrong and you get stuck with a loan and no income stream to pay for it. I am a big proponent of paying off personal debt and mortgages quickly. The sooner all of that personal debt is out of the way, the sooner you can start accumulating funds to get into bigger and better things.
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Old 01-04-2017, 06:30 AM
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Originally Posted by Fishindude77 View Post
I've done most investment stuff like this cash & carry, without borrowing money. Save and accumulate till you find a good deal, then invest. On the few occasions where we used a bank, it was for a very short term, quickly paid off.

I don't like paying interest or having much debt hanging over my head, even if the return is much better than the interest I'm paying. Things can change or go wrong and you get stuck with a loan and no income stream to pay for it. I am a big proponent of paying off personal debt and mortgages quickly. The sooner all of that personal debt is out of the way, the sooner you can start accumulating funds to get into bigger and better things.
Sound strategy.
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  #75 (permalink)  
Old 01-08-2017, 11:16 PM
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People in real estate and property owners across the country should therefore be on alert about any policy discussion on real estate. His promises are going to turn false for all you know.
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Old 01-09-2017, 05:12 PM
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Originally Posted by Gwenstacy View Post
People in real estate and property owners across the country should therefore be on alert about any policy discussion on real estate. His promises are going to turn false for all you know.
Earth to Mars, can you clarify ?
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