All Forum Posts by: Chris John

Even in today's market, you should be able to buy an out of state multifamily for 650k that would produce a lot more than $700/mo in cash flow.  Having said that, I have no idea what the appreciation might be between the two...

Quote from @Carlos Ptriawan:

Quote from @Chris John:

I'm not sure what will happen to rent prices once everything settles down (our rents in Florida are definitely down from the highs of 6-12 months ago), but I'm not closing the door on the possibility that they'll rise again.  In theory, we should see wage inflation kicking in at some point which may drive higher rents sooner than some anticipate.  This isn't a prediction, but it wouldn't surprise me.

 possibly one-fourth of syndication is in trouble now due to their trouble choice of opting into the floating interest rate.

Direct ownershp is way better at this conjecture. 

What is scary is that if inflation is sticky like in CPI in Jan, that wasn't good.

I feel like a lot of people go on and on about syndications.  When I looked into them, I was really nervous about losing control of my capital based on other people's assumptions like projected rent increases, increased appreciation of the asset over time, and future interest rates.  I've never borrowed money on a commercial loan, but it's my understanding that they typically adjust every 5 years or so. 

So, in the end, it was a scary proposition for me to give my money to someone that's numbers looked good because they were going to increase rent every year, refinance at low rates, and then sell the asset for double what the syndication paid.  I understand that some people are able to force appreciation and all, but I figured that I was better off buying a property with a 30 year fixed rate and a current monthly cashflow that I was comfortable with.  I don't think I'd ever be able to do a syndication.  The loss of control is too much for me to bear...

I'm not sure what will happen to rent prices once everything settles down (our rents in Florida are definitely down from the highs of 6-12 months ago), but I'm not closing the door on the possibility that they'll rise again.  In theory, we should see wage inflation kicking in at some point which may drive higher rents sooner than some anticipate.  This isn't a prediction, but it wouldn't surprise me.

Color me greedy cuz I'm not about to give this up!!! 

We just took repossession of our California portfolio from our PM that was great at getting rents, but awful at everything else.  Tons of deferred maintenance and a lot of work to do to clean up this mess.  I was driving home from one of the walkthroughs last night and lamenting the work that needs to be done and the money spent when it occurred to me how much money we've made on that house since we bought it.  Then everything was ok.  We'll dump money into it and go again!  ;)  haha.

@Mike Dymski

I've heard over and over that the stimulus money wasn't going to cause inflation.  Then, when by total coincidence, when we did have inflation, I was assured that it wasn't because of the stimulus.  Are you intimating that I was misled?  If so, I'm sure it was accidental...  haha.

@Nick Robinson

"The problem is that every recession/depression looks like a soft landing till it isn't."

So simple, yet so true!  If they were obvious to everyone, we'd never have one.  haha.

I know it doesn't really mean anything, but @Carlos Ptriawan has a shockingly low "Vote" count for the value he brings to these boards in my opinion.

Carlos, thank you for sharing all that you do.  Your focus on locales, various price points, and the tightness/looseness of the monetary supply have been a paradigm shift for me and given me a LOT to think about!

@Carlos Ptriawan

I really like your logic, but I can't afford to buy high dollar properties and hold for appreciation.  I'm just a teacher so the properties I buy have to comfortably pay for themselves.  

I will say that someone in my neighborhood (a small town in the central valley of California) bought a house for 800k.  That house would've probably gone for around 1.2M at the height of the recent market when rates were incredibly low.  I think that buyer did VERY well for themself. 

I'd have love to have bought it, but the rents wouldn't come close to covering the mortgage and I'm not in a position to supplement the difference until I could cash in.  I won't be surprised at all if that house sells for over a million in the next few years and the buyer makes a nice score if they don't see it as their "forever home" for whatever reason.

I'm all for always being on the lookout for great deals and all (and I think @Carlos Ptriawan is onto something with his deep dive analytics), but if this is such a great time and everyone is buying, why is volume so low?

Truth be told, these are tough times to find good deals for the average property investor that uses traditional financing because almost all of the numbers run don't make sense.

Even in the markets that still might make sense on paper, you can't begin to tell me that the deals pencil out the way they did 2 years ago.  And, you may not wanna hear it, but there's a reason that those markets are still relatively cheap to begin with.

TLDR: It's a good book and well worth the money for neophytes.  People are "haters".

-Importance of financial education

-His definition of assets and liabilities vs. actual definitions

-Cashflows of poor, middle class, and wealthy

-Description of how middle class fall into financial nightmares

-Owner Occ as a liability

-Importance of passive income

-Descriptions of balance sheets and income statements

-Having assets pay for your liabilities instead of just buying liabilities

-Importance of selling and being a salesman

-Working to learn

-Taking accountability for yourself financially

These are lessons that most people don't know and aren't taught in high school (I'm a former high school business teacher).  $18 for this knowledge is a pretty fair trade. 

From there, his boardgame "Cashflow 101" is a great way to learn about investing for those that don't have people around them to teach them similar strategies.  I literally feel like I've taken the lessons from that game into my real life.  Equities funded my real estate (small deals) which funded my bigger real estate and businesses (big deals).

Finally, "On the Road with Robert Kiyosaki" was a great program for someone like myself that didn't know anything about home ownership, finding a rental, what a reasonable deal could look like, etc.  I was PETRIFIED picking my first rental.  Is it going to need a new foundation?  Are there termites?  Are the electrical wires suitable?  I literally didn't know anything about houses or home ownership.

I'm not saying these are the perfect ways to learn about real estate or investing, but it's certainly a great surrogate for those of us that didn't have access to mentors and were just generally poor.  It gave hope and belief to me, for sure.

And, I think it's really worth mentioning that this was essentially before home computers and the Internet were ubiquitous (well, I didn't have either at the time), so it's not like you could just watch the latest YouTube video to glean all of this information.

In the end, people are unnecessarily harsh.  Also, as far as it being fraudulent, it's clearly fictionalized, but apparently about his friend Richard Kimi.  I really respect my grandfather and I could tell you a million stories that I believe to be true, but I wouldn't be surprised if you could punch holes in some of them.  That's the way memories work.  I mean, my grandpa probably wasn't really 10 feet tall, but that's the way I remember him anyway...