All Forum Posts by: Alexandre Marques dos Santos

@Joe Villeneuve

I understand the concept of leveraging. Having more than 25 years of financial markets in my curriculum, its easy to understand.

But there are different investors profiles. I respect your view. Leveraging is a part of the game for some players.

But to me RE is a diversification. I have cash invested in many different assets, some “safe” some risky. The RE was an allocation of the “safe” piece of my portfolio. Instead of making a “ killing” in the bank, ( 2% p y at the time), i put i RE to make more. Considering depreciation, the net value was considerable higher.

I still have a fairly good amount of cash sitting in the bank. I dont see value in paying 4.5% for a loan, with 5k in closing costs, while my money is making 2-3%.

When i allocate this piece, i will start leveraging

To my defense, i got a loan and bought some units while cash flow paid quickly the loan. It was a short term line of credit linked to my investments. What was a big surprise to me was to see many banks turning me down or presenting very high rates for mortgages, even having a 800+ credit score. They did not like the fact i did not have a w 2 stable income, but only rental/ investment income...

@Joe Villeneuve

Joe, not sure when i compare RE with Stock market... where did i gave this impression?

I have a total of 8 SFH fully paid that were the source of my retirement.

Every year i had to fill a dispute to tax appraisal as they always put the price of my property very high, in order to collect more taxes.

That started to bother me as my expense becomes higher than usual. Instead of paying a % of the right value of the property in taxes, i usually paid more. That is because i had to pay the attorney fees.

I also noticed the rental price dropped as massive inventory was added to to the city i have my properties. When i strt buying those, i was having around 5-5,25% return. Since then rental prices dropped 5-10%.

All together, plus the fact i started to foresee an increase in capex ( properties are now 7 years old), dropped drastically my expected COC return.

So i was hoping i for an opportunity to change the allocation on some of my investments.

With this market, i saw prices increasing by as much as 10%. Rentals are flat. So i decided to sell some of my properties. I already sold 3 and i am negotiating the 4 th one. I expect market to cool down a bit, and a possible increase in foreclosures. If that happens, i will be in a great position to acquire distressed properties. Am i crazy?

Life insurance is NOT an investment.  My post is a way to maximize IF YOU HAVE IT.  the return in a Life insurance policy will only come after the 5th / 7th year...  because you will spend money in Life insurance.  There are several companies.  if you want  a referral, send me a message private and i will give you a contact to discuss/learn.

@Nina Granberry

I take that you do not have mortgage or debt. If you have any if those, pay it. Mortgage i would accumulate a bit, and ask for recasting. Keep tenor and reduce payments, this will give you even more cash flow.

Another interesting way to accumulate is if you have a life insurance. You can deposit there and the cash value is a good source when you are ready to buy another property.

If you do not have mortgage, i would accumulate a bit, go to your bank and open a HELOC. With that would buy another property, taking the accumulated money plus the heloc. Then cash flow goes to pay the heloc. By the time cash flows increase and i repeat the process.

Good luck

@Sam Leon

Looks like they put a hot iron in it. Some Women uses curlers, that gets very hot and could easily damage a plastic surface.

@Jovann Thompson

So on your situation, i would save a bit more. RE investing can be a rewarding investment but as many, has some risk. You need to be prepared to assume those risks. The less prepare you are to assume, the easier way to fail it.

Its not just about buying and renting a property. You need to have reserves for adversity. As i mentioned earlier, and air conditioner, a furnace, roof, or just longer time to rent it. This all have potential to put a new investor to fail.

Have some extra as reserves OR have a great cashflow ( put a bit more down payment) to help you to face adversity. Dont rush yourself to invest without being prepared

Good luck

@Jovann Thompson

I will be very honest, and please, dont feel offended.

15 k will take you to invest, buy a property that might give you cashflow if everything goes well. Then, as in any RE investment, the air conditioner (or else) breaks, and you start having a big problem... or maybe you take a big longer to rent? can you afford anything like this?

On other chapter, are you paying a rent now? How much do you pay, and how much this property ( or similar) cost? Does this fits as a good investment? Put in perspective you will get a better loan and vacancy rate is zero ( you wont leave).

I know own house might be a liability, but not if you put in perspective and look as investor. Be cool and analyse like you were investing.

@Mark H. Porter

Thank you

@Lee Ripma

Thank you.