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Most recommend starting a LLC for your rentals. Not sure how the taxes would work out though.
Home Buying & Real Estate Thread
- Thread in 'General' Thread starter Started by TYE_The Time Traveler,
- Start date
Proposition Joe
formerly rollinwithangel
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Uncle sam is an A-hole. 
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lilchico4life
good info... do you own any rentals yet, if so how are they doing?
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capital sb
It's great since you get unlimited access to the all features. I wouldn't recommend getting it if you're not going to spend a lot of time dedicated to REI.@millenial There are two basic terms anyone in REI should know, Cap Rate and Cash on Cash return. Calculate cap rate if you're purchasing the property in cash. Calculate the cash on cash return if you're leveraging.
I like to calculate the rock bottom return I'd get on my investment. If it turns out to be more, thats a bonus. I aim for at least a 10% cap rate in my market (Tampa, FL). It will definitely be less in markets such as in NY and Cali.
206to813
Yes, I've acquired 8 units in the past 2 years. It was 10 but had to sell 2 because they weren't producing as I calculated they would. The 8 I have now are doing phenomenal. What I've learned is to always buy duplexes and multiplexes. Factoring in vacancy, with duplexes and multiplexes you can still collect rent from one unit if the other unit is vacant. You'll still be able to pay your mortgage. Now with SFH, once it is vacant, you may have to wait 1-2 months to find a tenant, leaving you to make mortgage payments out of pocket. Vacancy should be no more than 5%-8%.
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Thanks Chico, my plan is to only buy multi-units, I want to start with a few duplex's then up to some 4 plex's then small apartment building and so on. Your reasoning behind not going SFH makes sense.
What are your goals if you don't mind me asking?
What are your goals if you don't mind me asking?
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@millenial There are two basic terms anyone in REI should know, Cap Rate and Cash on Cash return. Calculate cap rate if you're purchasing the property in cash. Calculate the cash on cash return if you're leveraging.
I like to calculate the rock bottom return I'd get on my investment. If it turns out to be more, thats a bonus. I aim for at least a 10% cap rate in my market (Tampa, FL). It will definitely be less in markets such as in NY and Cali.
Outside of Mentally being ready, what steps/goals do you recommend one setting for themselves prior to getting into the game? Ie. Ideal situation a person should set themselves with whether it be establishing business lines of credit, setting up an LLC, etc. Like if you were to make a list of the 5 or so things one should do before making the jump. There is a lot of info out there but it gets overwhelming when you are researching with no real direction of specifics to look for.
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Just accepted a counter offer on a house my husband and I really love and we have an inspection scheduled for Thursday. Seriously, if this all works out and we move in, I'm never moving again. This has been such an annoying and stressful process. I literally feel like I'm on the verge of a heart attack all the time!
al audi
Banned
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Upgraded to Pro
2 things I got, lots of free time and solid capital.
Only thread I'm gonna stay in seems I've been causing problems on NT [emoji]128517[/emoji]
So I hope to be a solid contributor in this section.
My friends call me Al btw
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My bad for late response. Yes, I was saying the portfolio will generate the 5k. The goal is to build that up prior to them graduating high school.
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you're not down anything, you're actually up +$12K
profit is the wrong word real estate is about ROI, doesn't matter if it's flip or rental, just changes the ROI.
in that scenario you would make an annual 24% ROI, which is impressive. but if it's a hot market like cali, the game is not renting, investor are looking to flip.
I think most of you need to do diligent research, learn about financing, property management, contracting work/estimates, market rates. there are many fee's and things that come up in RE, that get glossed over or forgotten.
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@millenial There are two basic terms anyone in REI should know, Cap Rate and Cash on Cash return. Calculate cap rate if you're purchasing the property in cash. Calculate the cash on cash return if you're leveraging.
I like to calculate the rock bottom return I'd get on my investment. If it turns out to be more, thats a bonus. I aim for at least a 10% cap rate in my market (Tampa, FL). It will definitely be less in markets such as in NY and Cali.
Outside of Mentally being ready, what steps/goals do you recommend one setting for themselves prior to getting into the game? Ie. Ideal situation a person should set themselves with whether it be establishing business lines of credit, setting up an LLC, etc. Like if you were to make a list of the 5 or so things one should do before making the jump. There is a lot of info out there but it gets overwhelming when you are researching with no real direction of specifics to look for.
This.
I'm already a member on BP, but I'd be lying to you if I said i was on there frequently. The sheer amount of information is overwhelming. My hope is to start investing in RE by 2017, and I should be studying up right now; but as mentioned, the amount of information is daunting.
...
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@millenial There are two basic terms anyone in REI should know, Cap Rate and Cash on Cash return. Calculate cap rate if you're purchasing the property in cash. Calculate the cash on cash return if you're leveraging.
I like to calculate the rock bottom return I'd get on my investment. If it turns out to be more, thats a bonus. I aim for at least a 10% cap rate in my market (Tampa, FL). It will definitely be less in markets such as in NY and Cali.
Outside of Mentally being ready, what steps/goals do you recommend one setting for themselves prior to getting into the game? Ie. Ideal situation a person should set themselves with whether it be establishing business lines of credit, setting up an LLC, etc. Like if you were to make a list of the 5 or so things one should do before making the jump. There is a lot of info out there but it gets overwhelming when you are researching with no real direction of specifics to look for.
This.
I'm already a member on BP, but I'd be lying to you if I said i was on there frequently. The sheer amount of information is overwhelming. My hope is to start investing in RE by 2017, and I should be studying up right now; but as mentioned, the amount of information is daunting.
...
I think im in the same position as most of the guys that are interested in getting started. It is a lot but ive found it best to try to focus on what you are really interested in and build from there.
If you want to flip houses focus on renovation costs, contractors and estimating after repair values.
If you want to build a portfolio learn about managing properties, screening tenants, and the difference between rental income and true cash flow.
Multiple members of my family have been involved in real estate in some fashion since i was born and tbh 90% of them have made horrible mistakes. Most of them didn't do their due diligence, didnt properly manage the income or placed horrible tenants.
If someone isnt willing to put in the work to learn then they wont be successful.
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I love listening to BP's podcasts when I'm driving or running on a treadmill. Their guests are everyday people who started from
nothing and thru hard work, reached their goal. It seriously lights a fire in myself when I hear their stories and it pushes me to do more.
nothing and thru hard work, reached their goal. It seriously lights a fire in myself when I hear their stories and it pushes me to do more.
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Start listening to the podcasts that interest you in your free time. To/from work, folding clothes, laundry, exercise etc.
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yea I`m trying to be Debt free in the next 3-4 yrs minus my current mortgage and probably last bit of Student Loans I have (not much or anything crazy). I`m 27 now and I want to prob have my first property by 32, and then have my first actual business by 35, I`m trying to be out of the being an employee of someone game completely by 45.
al audi
Banned
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1 of the first things they told us at a real estate investment summit in Vegas when i went with moms in 2010
I'm sure i can find out from big pockets and obviously her about that
al audi
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Same age and I feel you 100%
I gave myself to the age of 40 when I first started working but after really focusing on my future I dont think I can last that long.
Over the past year while I was saving for my current home I learned a lot about myself. Its amazing how much I was willing to sacrifice for what I wanted when before I couldn't imagine giving certain things up. If i knew what I know now 10 years ago when I left HS I would be so much further along.I dont want to be saying the same things 10 years from now so im ive really been trying to push myself this year and hopefully it works out.
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i like this this man thinks
we need to link up when i hit atl man
lol Can't be no grown man having to depend on corporate directors on whether I can feed my kids or send them to college. I don't knock anyone who does it, but I feel most of the people who are successful worked their normal jobs and learned from it then applied what they learn for their own businesses.
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yea, the thing with a lot of young people is many of us are first gen "people that made it" so you dont have a blueprint to go off of on what moves to make to CREATE GENERATIONAL WEALTH. We get caught up in getting good jobs but you cant pass down a good job to your kid. Real Estate isn't going to be my main focus, but its impossible to become truly wealthy without owning land that generates income. And at the end of the day land will always have value even if the dollar is worthless.
al audi
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man i wish i had your mindset at a younger age.............i honestly did mature not until age 29 (don't let my NT persona fool you)
i just was on the ******** livin care free.................now its like i have a 2nd chance at life, not gonna get all religious in here but i feel very blessed
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I mean initially I always wanted to just climb the ladder in the corporate world and call it a day, but at the end of the day I just dont like the idea of someone being in control of my life especially having kids and stuff. I dont knock anyone who works but its foolish to not at least invest your money in addition to working. I just cant see myself being old and still having to play corporate politics.
al audi
Banned
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the year was 1994
Mom came home one day miserable.........told my dad, I'm sick of the ********. Going to start my own practice........its now 2016 she has been without a boss since. Cushy schedule and takes vay cay when she wants, no late nights....... an owns properties that will be passed down to my sister an I. A broke woman born in the 1950s from stupid *** MS
so yea................my mindset comes a lot from her, most successful out of her siblings
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