Lender · Los Angeles, CA · Member since 2009 · 1k+ posts · 2k+ votes
Wow. I just read a thread where one of the responses all but called several others out in disagreement over what I thought was a stupendously mundane issue.
There seem to be a number of topics that historically raise the hackles of many on this board. Here are a few I’ve observed that cause many to jump in emotionally:
1) Is wholesaling legal?
2) Does the 70% rule work?
3) What's the difference between hard money and private money?
I rarely read anything more than my few followed categories so I’m wondering what topics others are emotionally invested in.
Often, the posts go on and on and never really address the OP’s original question. Please, let’s not open these questions up. I’m more curious why these topics, and perhaps others you can add, seem to draw the ire of some participants here.
And yes -- guilty. I’ve admittedly gotten sucked in on occasion.
Real Estate Agent/Investor · Peoria, AZ · Member since 2016 · 2k+ posts · 2k+ votes
4y
One of my all-time favorites...
2016 - Is real estate going to crash? Should I buy now? 2017 - Is real estate going to crash? Should I buy now? 2018 - Is real estate going to crash? Should I buy now? 2019 - Is real estate going to crash? Should I buy now? 2020 - Is real estate going to crash? Should I buy now? 2021 - Is real estate going to crash? Should I buy now? 2022 - Is real estate going to crash? Should I buy now?
Wow. I just read a thread where one of the responses all but called several others out in disagreement over what I thought was a stupendously mundane issue.
There seem to be a number of topics that historically raise the hackles of many on this board. Here are a few I’ve observed that cause many to jump in emotionally:
1) Is wholesaling legal?
2) Does the 70% rule work?
3) What's the difference between hard money and private money?
I rarely read anything more than my few followed categories so I’m wondering what topics others are emotionally invested in.
Often, the posts go on and on and never really address the OP’s original question. Please, let’s not open these questions up. I’m more curious why these topics, and perhaps others you can add, seem to draw the ire of some participants here.
And yes -- guilty. I’ve admittedly gotten sucked in on occasion.
Just ask what a good cap rate is for a house. Shots fired!
A knowledgeable seasoned dude named Bob Bowling was banished from BP because of over-heated cap rate discussions.
Cap rates were more hotly debated in the mid 20teens than the LLC or not discussions now.
Yup I remember Bob I was going to meet up with him on one of my Trips to Honolulu but never got the chance he lives right around the corner from a partner of mine there. He was also big on the other hot topic.. CASH FLOW Vs APPRECIATION Or California or west coast VS Mid west cash flow markets. Another is Turnkey VS going out of state yourself by trying to find this mythical 4 core team LOL.
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
4y
AS you note
Wholesaling is a huge hot button on this site.
is it legal is it not. at least the way its taught by the online how-to guys. and then promulgated on a site like BP.
Clayton Morris threads were something to behold. Poster child of how not to invest with a TV personality.
Fake lenders trying to sucker newbies into loans that dont exist only to take up front fee's and vanish.
Then the specific advice on a subject that is very state specific so one person from across the country who only knows their state laws thinks those laws are the only way things are done.
And of course the mother of all of these YOU NEED TO GET A LAWYER ON THIS right now.. on some 500.00 problem LOL
Lender · CO CA TX WA ID OR · Member since 2020 · 419 posts · 542 votes
4y
@Jeff S. Outside of the items mentioned in this thread so far, I have 2 things that I've noticed in the corner of BP that I inhabit.
1. The word "California" appears to be triggering. If you say "California" it gets followed up with "aw man, the tenant laws out there. Tenants have more rights than landlords!" Which is true, but still, some people want to invest close to home and just see the occupancy laws as just another obstacle, like toilets. There's 40 million people in CA, lol they need a place to live! When I used to live in AZ, California would send some folks down a path where it would sincerely get them upset. It's incomprehensible that every single person in CA is a degenerate anarchist that is actively working to make our nation a socialist state. Most of us are regular folks with regular jobs that want the best for our families.
2. VA Loans - Lol admittedly I'm a bit sensitive to this topic. It used to be that agents and lenders did not know how to navigate through the VA loan guidelines and steered veteran/active duty clients away from using them because of their perceived weakness and "additional fees and paperwork". This honestly could not be farther than the truth. I've taken time to publish charts showing VA vs. FHA and VA vs. Conventional and the VA loan always wins on up front cash, cost of the loan over time, CoC return, and barrier to entry. The rates are substantially better, it's zero down, and the Funding Fee is less over time when you compare it to conventional and FHA mortgage insurance premiums - it's mathematically superior, however the old guard of agents and lenders failed to realize that or take the time to understand.
VA Loans also require a pest inspection to make sure there is not an active infestation - I suspect this requirement also swayed agents from wanting to use a VA client - I guess we'll just have our vets and active duty military live in a home with bugs... cool. For a young, active duty military member that makes a small income, using their VA loan to house hack and learn to be a landlord is absolutely the best option in my opinion. I don't see a problem a 22 year old with no landlording experience and $20k to their name jumping into RE investing by house hacking a home they bought for 0% down. What's the problem? Low barrier to entry and the best priced mortgage there is. Investing with guardrails, IMHO. Lol rant over.
I'm not sure if this is narrow enough to constitute a "topic," but it frustrates me when beginners are told to start with some of the the toughest strategies!
like - flip houses to generate capital! lend your life savings out to random local flippers! invest in profitable syndications!
this seems to me to be terrible advice... beginners have no business doing any of these things. they should house hack or buy 1 rental and make sure they want to be landlord. HNWIs can do anything they want - become a private lender or put it all in crypto. but not beginners!
Lender · Los Angeles, CA · Member since 2009 · 1k+ posts · 2k+ votes
4y
It counts @Nicholas L., because many of the responses here I bet reflect the things that really set the person responding off. I know my initial list contains some of my personal pet peeves.
I’ll only modify your response slightly:
… lend your retirement plan out to random out-of-state flippers (i.e. strangers) on a home you’ve never seen in a town you’d have to find using a map.
Or
Put your family's house at risk using a HELOC (in this day of rising rates), borrow from your elderly grandmother, and use credit cards, so you can learn how to do an out-of-state flip.
It counts @Nicholas L., because many of the responses here I bet reflect the things that really set the person responding off. I know my initial list contains some of my personal pet peeves.
I’ll only modify your response slightly:
… lend your retirement plan out to random out-of-state flippers (i.e. strangers) on a home you’ve never seen in a town you’d have to find using a map.
Or
Put your family's house at risk using a HELOC (in this day of rising rates), borrow from your elderly grandmother, and use credit cards, so you can learn how to do an out-of-state flip.
Jeeze.
there was a post a few years ago about an investor who lives in LA and who took a 200k heloc and then admittedly bought D class units in Memphis. and on paper looked great and many of the newer investors were really giving him Kudo's my self I posted YOU DID WHAT .. then laid out a few facts of how risky that was then the post started to come in YA that is risky we never heard from him again.
Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
4y
Let’s not forget the weekly post asking if they should go solar.
Paying cash or paying off rentals vs leverage and refi until you die versus a never ending string of 1031 exchanges all gets some strong opinions but I really like reading on this topic and hearing others views since there is no right or wrong answer to this one, really it depends on your goals and situation.
Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes
4y
OK. The BP user who puts up a bunch of numbers on a potential buy and asks anyone who cares to comment if this is a good deal. Bonus points if it's a duplex or triplex. Super bonus points if it's in the Pittsburgh area, where I am.
What these posts all have in common is that there is NEVER ANY INFORMATION ABOUT THE BUILDING. The BP user clearly expects that an inspection is going to tell her/him EVERYTHING about the structure, what's good about it, what's bad about it, all the uncertainty will get taken out of process of buying property and there will be nothing beyond the numbers to consider.
The reason this drives me crazy in the Pittsburgh area is that, while we have wonderful properties that are 100 years old, they are standing right next to places that should have been bulldozed twenty years ago. There is a an extremely wide range in initial build quality and workable design to consider when buying anything here. If that's not enough, the complicated and painful history of this town, the geography of a city that is built in hollows and ravines and on hillsides and flood plains (the city of Pittsburgh has more bridges than the city of Venice), and the dilapidated infrastructure of the city often means that the neighborhoods can change wildly in value in a street or two.
The duplex/triplex thing similarly annoys me because there are all kinds of duplexes and triplexes out here. I live in a purpose-built over-under brick-veneer duplex built in the 1920s for the family of a local heiress. Great building. Solid 2nd generation 12-gauge knob-and-tube wiring that's never been disturbed. No significant electrical or physical remodeling since 1945. It's been a wonderful investment for me. I live in it, so I can get a loan on it, despite the antiquated wiring. On the other hand, I live down the street from a triplex that was also built in the late twenties, but as a single-family with a detached garage. It was converted into a triplex some time in the 1970s with a homemade addition. It was junk when it was built, it was illegal junk when it was remodeled, the place is a fire trap waiting for a match, the owner plays Whac-a-Mole with little fixes every week that are bleeding him dry. I would never buy a crapshack like that, let along try to remote-manage it from six states away, with the banks laughing at me when I go to them to tap the equity in the property.
But if you just put up the gross-income numbers for my duplex next to his triplex, oh yeah, the investment potential of the triplex looks GREAT! Perfect bait for some fool who thinks a house is a house is a house and that's all they need to know about the real estate business before plunging their life savings into it.
It counts @Nicholas L., because many of the responses here I bet reflect the things that really set the person responding off. I know my initial list contains some of my personal pet peeves.
I’ll only modify your response slightly:
… lend your retirement plan out to random out-of-state flippers (i.e. strangers) on a home you’ve never seen in a town you’d have to find using a map.
Or
Put your family's house at risk using a HELOC (in this day of rising rates), borrow from your elderly grandmother, and use credit cards, so you can learn how to do an out-of-state flip.
Jeeze.
there was a post a few years ago about an investor who lives in LA and who took a 200k heloc and then admittedly bought D class units in Memphis. and on paper looked great and many of the newer investors were really giving him Kudo's my self I posted YOU DID WHAT .. then laid out a few facts of how risky that was then the post started to come in YA that is risky we never heard from him again.
I was here when it happened. Three-quarters of BP stood up and cheered this poor deluded fool initially. Starting with Jay, there were maybe four or five experienced users and long-time landlords on this site who went against the prevailing opinion and explained how ridiculous the idea was. And again, starting with Jay, those few users got criticized for their dream-quashing negativity about inner-city D-class in Memphis. What did that guy get get, eight single-family crapshacks in the ghetto for his $200K? I think the title of his initial post was ZERO TO EIGHT UNITS IN 30 DAYS!!!
We've never heard from that user again after his initial post.
Investor · San Jose, CA · Member since 2018 · 313 posts · 230 votes
4y
The ADU topic in California.
The patchwork of rules has constantly been changing over the past few years at the state and city levels so there is always uncertainty and arguments.
Also, people out-of-state don't understand the investment strategy of ADUs in California. They often say "why don't you invest in Florida or Missouri". I think those comments are based on the cash flow vs appreciation arguments.
Real Estate Agent/Investor · Peoria, AZ · Member since 2016 · 2k+ posts · 2k+ votes
4y
One of my all-time favorites...
2016 - Is real estate going to crash? Should I buy now? 2017 - Is real estate going to crash? Should I buy now? 2018 - Is real estate going to crash? Should I buy now? 2019 - Is real estate going to crash? Should I buy now? 2020 - Is real estate going to crash? Should I buy now? 2021 - Is real estate going to crash? Should I buy now? 2022 - Is real estate going to crash? Should I buy now?
Developer · New Brunswick, NJ · Member since 2015 · 1k+ posts · 2k+ votes
4y
Ask people if they should hire a property manager. That gets the DIY landlords on here triggered worse than the blue check marks on Twitter. Entertaining threads.
Real Estate Broker · Fayetteville, NC · Member since 2020 · 251 posts · 244 votes
4y
@Jeff S. It definitely annoys me that people think private lending is expressly lending from your family or friends. Extremely pedestrian idea of the term. Private lending is basically just non-conforming loans. Hard money is private lending. 30 year fixed loans made to an LLC is private lending. A loan on a 50 unit complex is private lending.
Lender · Patterson, NY · Member since 2017 · 488 posts · 186 votes
4y
It's not the topics ... my view is that everyone is invited to ask. What irks me are responses that do not address the question ... seeming to merely seek an chanceto reply ... or if the question asks about StateX, and the reply states 'well, I'm in StateY, and here we do this"...
It's not the topics ... my view is that everyone is invited to ask. What irks me are responses that do not address the question ... seeming to merely seek an chanceto reply ... or if the question asks about StateX, and the reply states 'well, I'm in StateY, and here we do this"...
Is that helpful to the discussion? just asking.
Am I the only one that sees the irony of this response?