All Forum Posts by: Brandt Smith

@Dacia RayI would avoid this business model. The evictions / headaches / late payments / trashed units will never be worth it. There is a reason most of these people are forced to live in horrific environments. Landlords get tired of (and can't afford) having to spend thousands of $$$ to renovate the unit only to see it trashed by the next tenant. It basically turns you into a slum lord...or you go out of business.

I appreciate the fact that you want to help, but the best way to do that is to start a charity. Use your real estate business to create your cashflow and wealth. Use your charity to channel your wealth back into the community you are helping.

@Adam Fout I use a few metrics up front: cashflow, equity gained, cash on cash (cashflow / cash invested), and Return on Capital Gain (equity gained when purchasing / cash invested). By not including equity build up, appreciation, etc...I am sure my investment is solid. I like15% + cash on cash and 25% + on return on capital gains. I want $400 cashflow and 10%+ equity. I don't always hit all but if one is a bit low (ie...cash on cash @ 10%) other metrics are high to compensate. And I always want a chunk of equity and solid ($300+) cashflow.

If you do this, you are protected when the **** hits the fan. Market drop? No problem. Unexpected vacancy? covered.

I do include equity buildup in my calcs but not when I make my decisions.

Glenn Gayet can you turn the property in a few weeks? Or will it take you months (or longer)? Time is money. How much will a DIY Reno cost you in holding costs? How much in opportunity costs?

Sergio Ali you need a lease. Have the tenants re-apply and do a full screening. If they qualify get them on a lease. Otherwise get them out.

Tyler Caruso you may want to sell and roll the proceeds into a new rental. The rent you get is low relative to your house value. You will get a much higher return if you roll your ~$50k equity into a couple rental homes that offer a better return. It could turn your $100 cash flow into $600-1000.

I didn't say she would. That is just the ballpark number where it works for me. $67k is above what it is worth without taking into consideration my risk or profit.

There isn't enough profit in this unless you get it for a lot less than her asking price. The $65k she wants is ARV - $10 repairs. And if you are wholesale'ing it, you need your profit as well. Would she take a $45k offer ($35k if you wholesale)? If not, walk away.

You have a long time to get there. Enjoy your life, save money, and invest your savings in cash flowing properties. It will snowball.

I personally don't like paying down loans. I want the advantage of the leverage and would rather put the $$$ in another property. As for the stock market, no thanks. Way overheated and looks just like in 2008 before the crash.

Depends on how you buy your home. Personally, I have 35%+ equity because I bought it right. On the other hand, I have friends (next door) who have no equity because they paid list price and got a second mortgage.

My rent would be 56% higher than my monthly payment and I pay up my equity $3k+ per year.