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Old 06-09-2017, 10:07 AM
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Default How many of you have rentals (i.e. you're a landlord)? Are they worth it?

How many of you have rentals (i.e. you're a landlord)? Are they worth it?

Once we pay off our mortgage it's something I've been mulling over doing.

What other questions should I be asking?
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Old 06-09-2017, 10:37 AM
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Hey Eagle...there is a real estate section...this should have been opened there. https://www.savingadvice.com/forums/...ate-investing/

Can a mod please move this? Thanks in advance.
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Old 06-09-2017, 10:43 AM
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Never even noticed that section. Is it new? Is it very active? For example I only really go to the General Discussion, Debt, and Personal finance sections.
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Old 06-09-2017, 10:59 AM
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Never even noticed that section. Is it new? Is it very active? For example I only really go to the General Discussion, Debt, and Personal finance sections.
It's not active. Real estate has been, ever since I have been coming to this site, considered a four-letter word.

If you want to talk real estate, you'll need to find another site - the subject is taboo here. The things that stay on the main board here are the really important subjects, like how much do you pay for a haircut, "little known" financial loopholes, WWYD with Albert Pujol's home run ball, etc. Trivial subjects such as discussion of the economy are properly relegated elsewhere.

As for your question, I have four vacation rentals and have done very well with them.
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Old 06-09-2017, 11:20 AM
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I think rentals can make a lot of money. But the way to evaluate a rental as an investment is not the same as evaluating a home you buy and live in. I would love to get into rentals but i need more time to learn and decide how to invest. It's not something I feel like I should just jump into.
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Old 06-09-2017, 11:26 AM
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Never even noticed that section. Is it new? Is it very active? For example I only really go to the General Discussion, Debt, and Personal finance sections.
Its semi new compared to the rest of the sections. Its good to keep some sort of order. For whatever reason people want to throw everything in the general discussion because its the most active. It becomes a cluster.

Do a google search using some of these searches...landlord, real estate, rentals, landlord followed by bogleheads. You'll get a lot of threads. There will be more of a mix there...some with horror stories...some with success. Thats the only site I know which discuss RE...although most there lean towards easier forms/less hands off forms of investing. <---(and the fact that I just said that will cause a firestorm...just wait)

Here there are only a handful (less than 5?) who worship real estate. To them any other way of investing doesnt cut it and is a waste of time. They're too biased...which is why you need to seek out other places to get a broad spectrum. But of course those who worship RE wont provide you with links to any other site that deals with real estate...big surprise there.

Heres a fact...this site struggles to provide any sort of (new) useful information. It hasnt for the past 1-2 years. Before then it seemed to do much better. There arent enough members so either ancient threads get bumped or topics are constantly regurgitated. It is what it is.

If you're interested here are some links to other sites that discuss financial related topics...bogleheads being the gold standard <---(this will also cause a firestorm...but not as bad as my statement above)

https://www.bogleheads.org/forum/index.php
http://www.early-retirement.org/forums/
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Old 06-09-2017, 12:16 PM
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Originally Posted by TexasHusker View Post
It's not active. Real estate has been, ever since I have been coming to this site, considered a four-letter word.

If you want to talk real estate, you'll need to find another site - the subject is taboo here. The things that stay on the main board here are the really important subjects, like how much do you pay for a haircut, "little known" financial loopholes, WWYD with Albert Pujol's home run ball, etc. Trivial subjects such as discussion of the economy are properly relegated elsewhere.

As for your question, I have four vacation rentals and have done very well with them.
Do you manage the 4 rentals yourself or use a 3rd party management company? So these rentals are near vacation sites? Why'd you choose that?
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Old 06-09-2017, 12:18 PM
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Originally Posted by rennigade View Post
Its semi new compared to the rest of the sections. Its good to keep some sort of order. For whatever reason people want to throw everything in the general discussion because its the most active. It becomes a cluster.

Do a google search using some of these searches...landlord, real estate, rentals, landlord followed by bogleheads. You'll get a lot of threads. There will be more of a mix there...some with horror stories...some with success. Thats the only site I know which discuss RE...although most there lean towards easier forms/less hands off forms of investing. <---(and the fact that I just said that will cause a firestorm...just wait)

Here there are only a handful (less than 5?) who worship real estate. To them any other way of investing doesnt cut it and is a waste of time. They're too biased...which is why you need to seek out other places to get a broad spectrum. But of course those who worship RE wont provide you with links to any other site that deals with real estate...big surprise there.

Heres a fact...this site struggles to provide any sort of (new) useful information. It hasnt for the past 1-2 years. Before then it seemed to do much better. There arent enough members so either ancient threads get bumped or topics are constantly regurgitated. It is what it is.

If you're interested here are some links to other sites that discuss financial related topics...bogleheads being the gold standard <---(this will also cause a firestorm...but not as bad as my statement above)

https://www.bogleheads.org/forum/index.php
http://www.early-retirement.org/forums/
Thanks for the heads up. Do you own any rentals?

Why do you think there hasn't been a lot of new useful information in the past 1-2 years?
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Old 06-09-2017, 12:24 PM
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I think rentals can make a lot of money. But the way to evaluate a rental as an investment is not the same as evaluating a home you buy and live in. I would love to get into rentals but i need more time to learn and decide how to invest. It's not something I feel like I should just jump into.
I kind of feel the same way. I shouldn't just jump into something without a lot of research. We didn't even buy our house for 12-18 months of me searching for houses at least on a bi-monthly basis.

We are at least a few years away and another promotion away from doing anything serious with rentals.

I've been tempted to cash out one of our mutual funds and just pay off the house but have resisted temptation. It was worth 30k in 2009-2010 and it's worth near 87k now. We only owe less than 90k now on our mortgage. I know it's the right call in the long-term... But still. Tempting.
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Old 06-09-2017, 01:28 PM
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Originally Posted by TexasHusker View Post
It's not active. Real estate has been, ever since I have been coming to this site, considered a four-letter word.

If you want to talk real estate, you'll need to find another site - the subject is taboo here.
The site is called SavingAdvice. Investing is certainly part of it but the majority of visitors just don't tend to be RE investors. It isn't bad or good. It's just the way it is. You don't need to be rude about it. If you want an active RE forum, I'm sure there are a few of them out there. This just isn't it. The subject isn't taboo at all. There just aren't more than a handful of people here who know anything about it.
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Old 06-09-2017, 01:30 PM
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I guess you could say I'm a RE worshiper, it's done very well for me and all my family members who own it as investment, it's provided my income for going on 8 years now with a much more lavish lifestyle than I ever had working.
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Old 06-09-2017, 01:43 PM
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Do you manage the 4 rentals yourself or use a 3rd party management company? So these rentals are near vacation sites? Why'd you choose that?
I use a management company, but I also own the management company.

I chose vacation rentals for several reasons:

1. I've got cool places to stay.
2. The yields are slightly better than traditional residential houses.
3. They don't require my hands-on management.
4. There is the potential for greater capital appreciation.
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Old 06-09-2017, 01:45 PM
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The site is called SavingAdvice. Investing is certainly part of it but the majority of visitors just don't tend to be RE investors. It isn't bad or good. It's just the way it is. You don't need to be rude about it. If you want an active RE forum, I'm sure there are a few of them out there. This just isn't it. The subject isn't taboo at all. There just aren't more than a handful of people here who know anything about it.
Perhaps if it wasn't relegated to another forum, more than a handful would know something about it. The criteria used by the moderators on which topics stay and which go is humorous, to say the least.
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Old 06-09-2017, 01:57 PM
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Perhaps if it wasn't relegated to another forum, more than a handful would know something about it. The criteria used by the moderators on which topics stay and which go is humorous, to say the least.
People felt that the few real estate conversations that there were were getting lost among everything else. That's why a separate forum was set up. It was to highlight the real estate stuff and put all of those conversations in the same place.
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Old 06-09-2017, 08:48 PM
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Perhaps if it wasn't relegated to another forum, more than a handful would know something about it.
I never pay attention to what forum category anything is sitting in... I don't navigate the site that way, I just use the "New Posts" link, and I know alot of others do the same... It doesn't really matter what forum anything is in, it's just a function of what threads are active.

OP, I currently own just one residential rental property, overseen for me by a management company. I'm not making a killing, but the renters are covering my expenses & are slowly building my equity in the house, so I'm happy with it. With that said, I'm definitely interested in becoming more involved with RE. My problem is primarily just inexperience with the field & a lack of skills that support it (I'm not handy or mechanically minded at all).
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Old 06-10-2017, 10:02 AM
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We have a rental property that should be paid off in less than a year. We have two mortgaes, one for buying the place $30K and one for the costs of fixing it up - new roof, windows, etc. Technically the one mortgage should be finished in a tad over a year and the other in September of next year but I'm paying extra each month. We handle it our selves, in the years we have had it we have only had two renters, both not being real good about paying the rent on time, but they don't ruin the property and the current renter actually paid his rent 'early' for him - 9 days late for us, 6 days earlier than his usual payment.

When paid off we should be getting about $400 extra a month that we can use and the rest to be saved for expenses to the place. It was bought spcifically to be a source of income in retirement and it looks like that will be the case. When times were super tight over the last 15 years, it was tempting to put it up for sale. We wouldn't want another one though. Not to many apartment manager types in our area.
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Old 06-13-2017, 12:25 AM
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I have 2 rental properties now. I bought one last year and one this year. They are both on 15 year loans. I can make the mortgage payments on both of them with collected rents with an extra $472 in the pocket. I just save that for the next one. This of course excludes maintenance costs which has been minimal so far.

I became debt free and wanted a way to be financially free within 15 years so this is my direction.

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Old 06-13-2017, 06:19 AM
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I have 2 rental properties now. I bought one last year and one this year. They are both on 15 year loans. I can make the mortgage payments on both of them with collected rents with an extra $472 in the pocket. I just save that for the next one. This of course excludes maintenance costs which has been minimal so far.

I became debt free and wanted a way to be financially free within 15 years so this is my direction.
You have the right idea and are on the right track.

I became "financially free" (able to quit my job and live on my businesses/investments) at age 46, and if you peel back the layers of how that occurred, real estate was at the foundation of it.

Really what got it started was the substantial equity in my own home that I had built. I was able to use that equity to do some really cool things that got the ball really rolling.
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Old 06-13-2017, 07:57 AM
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I have 2 rental properties now. I bought one last year and one this year. They are both on 15 year loans. I can make the mortgage payments on both of them with collected rents with an extra $472 in the pocket. I just save that for the next one. This of course excludes maintenance costs which has been minimal so far.

I became debt free and wanted a way to be financially free within 15 years so this is my direction.
How much did you buy the house for and how much do you rent it for? That's the sort of rental I want. With a lot of positive cash flow. Hence why I don't think my house where i live is rental quality.
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Old 06-13-2017, 08:06 AM
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How much did you buy the house for and how much do you rent it for? That's the sort of rental I want. With a lot of positive cash flow. Hence why I don't think my house where i live is rental quality.
Money is so cheap to borrow, I tend to go with a 30 year fixed. That way you are generating a lot more positive cash flow to buy more properties.

Of course you aren't paying them down as fast, but that's just my philosophy.

I think in the end, you are far better off getting more properties sooner. More cash flow makes this easier. With a paid-off rental, you are really allowing a lot of money to lay around unused.

The real power of rentals and real estate is in leverage.

Example:

I bought a $150,000 house once with $30,000 down. So my out of pocket was $30,000 basically. 10 years later I sold the home for $170,000. Meanwhile the renters had paid off around $19K of the house. So in 10 years, I made $40,000 off of a $30,000 investment. I also had some positive cash flow and tax savings!
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Last edited by TexasHusker; 06-13-2017 at 08:10 AM.
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