It's nov 8; where's the stock markets headed?

[sv2007]

I didn't hedge and netted a $50k+ gain (on paper anyway).

Oh, just a friendly FYI: depending on your investments, not hedging isn't a very smart thing... because large gains and losses then becomes somewhat more luck-based. I.e. a single day or single event jump can make or break some of these luck-oriented investors. Now, you may not be one of those investors, but it may be something to think about.

[TexasHusker]

Could say the same about real estate.

I bought a home right before the bubble in 2005 for 240,000. I've gotten $160,000 back in net rents after all expenses.

Bought another in 2005 for $150,000. Just sold it this year for $170K, and got about $110,000 back in rents after all expenses.

Bought another in 2010 for $230K. Have gotten $12K per year in net rents each year after all expenses since - so $72K payback so far.

Bought another in 2013 for $280K. This will be my third year of full earnings, about $60K paid back after all expenses.



I'm not worried about where real estate is headed on a daily, monthly, or yearly basis. Any capital gain is just icing on the cake.

Income baby!

p.s. --- I'm about $30,000 upside down on the $230K house, but the income has long since paid me back for that.

[james.hendrickson]

Texas,

Excellent return. Good for you man. Not all investors have their allocations turn out that well.

If you have a few moments I would be interested in hearing about the process of how you chose your real estate. I would also be very curious to hear how you minimized transaction costs when you bought your properties.

[TexasHusker]

Texas,

Excellent return. Good for you man. Not all investors have their allocations turn out that well.

If you have a few moments I would be interested in hearing about the process of how you chose your real estate. I would also be very curious to hear how you minimized transaction costs when you bought your properties.

There are not a lot of transaction costs.

I always borrow as much as the bank will allow when I buy investment property, but that still means I usually have to put down 20%.

You can be somewhat lazy and/or unlucky and still make very good money in real estate. Where you get into trouble is buying on pure speculation that the prices are going to continue to rise. That's essentially the same game as the stock market, and it can be disastrous.

There are so many good ways to make money with real estate. A friend of mine buys distressed properties, fixes them up, and then re-sells them for a profit. He's very picky on what he buys - he's trying to make about $20,000 per deal, and each deal is a 90 day turnaround. Sometimes he makes no profit, sometimes he makes $30,000. But on average he's shooting for $20,000.

I have another friend who buys warehouses and then leases them out for storage. Pretty painless, easy money there, and decent yields.

I found my niche in vacation home rentals. I try to find highly unique and sought after properties (on rivers and trout streams more specifically) that I know will rent well, and I can also personally enjoy them a few weeks a year.

All of my cabins are near Gatlinburg, TN. That again is my niche - I pretty well know what a cabin can rent for when I am looking at it, and I then just do the math and figure out if it is a good deal.

After I bought a few cabins out there, I decided "why pay someone else to manage my properties" and launched my own property management company (www.SmokyMountainFalls.com). So that's another way I make money on real estate - actually managing other peoples' properties.

It has its pitfalls - all of my properties require flood insurance, and I budget about $10,000 in repairs and maintenance of various sorts. Right now, I have to pay someone $1,000 to remove a huge dead tree that could fall on my property if I don't get it out. Just stuff like that.

In total, I get about $120,000 in annual rentals. 32% of that goes to the management co. (which I own), about $10,000 goes to r&m, and another $15K or so for utilities, taxes, and insurances.

But...ALL of those expenses are fully tax deductible. I am in the 30% bracket I believe, so $63,000 in expenses is actually saving me about $19,000 a year in income taxes, further boosting my effective income.

I also "depreciate" the properties on my taxes to the tune of about $24,000 per year, which is another deduction, amounting to about $8000 more to my income. Although I caution all of that is recaptured if and when you sell the properties.

So...I have about $60K in real income, and another $32,000 per year in tax savings, amounting to about $92K in income +/-.

Now, I also have mortgages on two of these properties to the tune of about $20K a year, but that's just the cost of doing business. Obviously the interest paid boosts my income a little, too. But other people are paying off these properties for me.

The management co. has grown into close to a six figure annual profit co., in and of itself, though I expect that number to go down about $30K in 2017 for several reasons.

The beauty of real estate is that one opportunity tends to spawn others.

Hope this helps.

[phantom]

All of my cabins are near Gatlinburg, TN. That again is my niche - I pretty well know what a cabin can rent for when I am looking at it, and I then just do the math and figure out if it is a good deal.

My husband and I stayed in a cabin near Gatlinburg on our honeymoon and plan to return someday. It's a beautiful area. We thought the idea of owning a cabin to rent out like that sounded like a cool idea, and it's nice hearing from someone who's making it work.

[StormRichards]

Dow posts best week since 2011 after Donald Trump election win

http://www.cnbc.com/2016/11/11/us-markets.html

[TexasHusker]

My husband and I stayed in a cabin near Gatlinburg on our honeymoon and plan to return someday. It's a beautiful area. We thought the idea of owning a cabin to rent out like that sounded like a cool idea, and it's nice hearing from someone who's making it work.

If you pick the right one, it will print money for you. PM me if you need any help.

[disneysteve]

Dow posts best week since 2011 after Donald Trump election win

Our portfolio is up by $27,300 in 5 days.

I'd happily give it all back to change the outcome of the election but at least it's one tiny (temporary) positive to the whole mess.

[StormRichards]

Our portfolio is up by $27,300 in 5 days.

I'd happily give it all back to change the outcome of the election but at least it's one tiny (temporary) positive to the whole mess.

There are 60+ million people that believe there are a lot of positives from this election.

For those that are not willing to accept reality and move on, there is a Change.org petition asking electors to defy their pledges or state laws and cast their vote for Clinton.

That would lead to a whole other set of protests, but of course those participants would be labeled racists.

[disneysteve]

There are 60+ million people that believe there are a lot of positives from this election.

And there are even more who believe otherwise.

For those that are not willing to accept reality and move on

I never suggested that I didn't accept it or that I wasn't ready to move on, but that doesn't mean I was happy about the outcome. You will not find me out in the streets protesting. The election result is what it is and we all need to accept and respect that and move forward. I am also a firm believer in respecting the office regardless of who happens to occupy it at any given time.

[StormRichards]

And there are even more who believe otherwise.


I never suggested that I didn't accept it or that I wasn't ready to move on, but that doesn't mean I was happy about the outcome. You will not find me out in the streets protesting. The election result is what it is and we all need to accept and respect that and move forward. I am also a firm believer in respecting the office regardless of who happens to occupy it at any given time.

Yes, but that percentage of even more is pretty small.

In my opinion, referring to the stock market rally as one tiny (temporary) positive isn't moving on.

[TexasHusker]

And there are even more who believe otherwise.


I never suggested that I didn't accept it or that I wasn't ready to move on, but that doesn't mean I was happy about the outcome. You will not find me out in the streets protesting. The election result is what it is and we all need to accept and respect that and move forward. I am also a firm believer in respecting the office regardless of who happens to occupy it at any given time.

Your sentiments are exactly mine in 2008 and 2012. I wondered how I would survive 8 years of presidency under a socialist leaning community organizer who had not one scrap of real world experience. If you are an advocate of Big government, your candidate lost, and if you look a county-by-county map, it was a tidal wave.

The only thing keeping Hillary in it was about half a dozen major population centers. Terry McAuliffe suddenly pardoned 60,000 felons in Virginia about two weeks ago. Any idea who those 60K voted for? Want to guess Hillary's margin of victory in VA?

Americans are tired of all of that, and exercised their will. Trump is far from a perfect candidate and I held my nose when I voted, but I could not in good conscience vote for a woman who has no respect for the law, has no concept of honesty, and is an abortion lover.

[disneysteve]

In my opinion, referring to the stock market rally as one tiny (temporary) positive isn't moving on.

Fair enough, but at least give me credit for pointing out something positive. That's more than many others are willing to do.

Listening to the business report on the local news yesterday, the analyst was saying how the rally really isn't related to the election outcome. It's all about standard economic measures like unemployment, earnings, etc. He totally downplayed it having anything to do with who got elected.

Now I will say that one big piece of my portfolio went in the wrong direction and that is directly due to Trump's election and that is my healthcare fund. If he has any success at all in dismantling the ACA and related policies, it will be awful for the healthcare industry and the stocks are already dropping in anticipation of that.

[TexasHusker]

Fair enough, but at least give me credit for pointing out something positive. That's more than many others are willing to do.

Listening to the business report on the local news yesterday, the analyst was saying how the rally really isn't related to the election outcome. It's all about standard economic measures like unemployment, earnings, etc. He totally downplayed it having anything to do with who got elected.

Now I will say that one big piece of my portfolio went in the wrong direction and that is directly due to Trump's election and that is my healthcare fund. If he has any success at all in dismantling the ACA and related policies, it will be awful for the healthcare industry and the stocks are already dropping in anticipation of that.

The healthcare industry has it coming. All of the $4000 MRIs and $100,000 hip replacements are going to come home to roost at a hospital near you. The healthcare industry is draining our GDP in ways too profound to measure. I don't feel one bit sorry for them. All ACA did is place more burden on businesses and consumers but gave the healthcare industry a free pass to rape and pillage.

[Joan.of.the.Arch]

Texas Husker says: The healthcare industry is draining our GDP in ways too profound to measure. I don't feel one bit sorry for them. All ACA did is place more burden on businesses and consumers but gave the healthcare industry a free pass to rape and pillage.

I think you probably mean that you are finding healthcare expensive. Because the healthcare sector adds to the GDP, not drains it. And I suppose it is very measurable. There are certainly some billing oddities that are maddening, but I think a big part of the reason for that is the prevalence of health insurance, not maliciousness on the part of the med tech who weighs us and check our blood pressure, the radiologist who runs the MRI, or the MD who evaluates our coughing and wheezing, or the office staff who interact with us and our insurance companies.