All Forum Posts by: Chris John

@Calvin Jordan

Such a great question.  Congrats, by the way.  That's exciting for sure!

I was actually thinking about this the other day.  On my first rental, I was watering the lawns because they weren't very green.  It was over the course of a couple of weeks of doing other stuff, but I would go out and pick the weeds out of the lawn by hand.  I felt stupid doing it, realized it was a terrible use of time, but couldn't stop myself for some reason.  Like, in my head, that lawn needed to be green with no weeds when I listed the house. 

Anyway, I'm out there pulling the weeds and I look over the fence and the neighbor is literally just watching me pick weeds.  I tried to make small talk with him and he said something like, "yeah, I've been out here a lot watching you out here pick weeds over the past few days..."  It was freaking WEIRD!  Long story short, it makes me chuckle every time I think of it and I've often thought "I'm never doing that again..."  haha.

@Russell Welch

That's exciting.  Good for you!  Honestly, I'm a pretty passive investor so I believe that there are a lot better uses for the money, but I'm pretty lazy...  If I were in your shoes I might wait for coronavirus to resolve itself first (obviously I have no crystal ball, but I personally believe the potential downside is lower than the potential upsides is higher until this figures itself out.  Definitely could be wrong...)

Anyway, I'd personally use leverage and try to acquire about 950k of property at 20% down.  If you buy right, you could probably get around 10k/mo in rent and your mortgages would probably run around 4.5k-5k/mo.  If you manage the properties yourself, you'd probably make around 60-65k a year (before unexpected expenses).  If you pay managers you'd probably make around 50-55k.

The great part is that with appreciation, depreciation, tax write-offs, etc. it'd probably be even more lucrative.  Happy hunting!

@Tyrone Marson

That was a pleasure to read and thanks for sharing.  What jumps out at me is how much your write up indicates you are learning and the sense of pride and accomplishment
that goes along with it.  Stories like these pump me up, so thanks for that!

The pics look great.  Good luck!

@Diane G.

You've got me scared.  I'm happy with my oos, but it's just the beginning.

"I have yet to see any one being successful and happy doing OOS"...  I sure hope this is hyperbole!

@Cheryl Lane

I mean, I can't argue with @Darius Ogloza at all.  I think your agent is the one that got you in this trouble (although you had mentioned something earlier about not asking if he would charge you so maybe you could've averted it?).

Having said that, I'd be pissed.  That definitely sounds unreasonable to me.  I've had small kitchen floors tiled for that price.  I'd consider overpaying him by $50 or $100 and telling him to invest it to help offset some of the business he'll be losing by my telling this story all over town.

@Alex Martens

I'd definitely make it two separate transactions.  Things have a way of getting complicated really quickly.  Having said that, just realize that you're probably never going to evict your brother (and he'll certainly never vote for that) so mentally steel yourself for things potentially going south...

To directly answer your question though, if he's ever going to skip rent it should be avoided.  If he pays rent consistently, it's a good opportunity to make money!  haha.

@Cheryl Lane

I just want to make sure I have this correct.  He charged you $500 to change some cover plates and remove a dead rat and a couple of blankets?  Surely there is more to this story, no?  Was there already brewing acrimony?  

On our OOS purchases we're very much relying on the agent and property manager to give us honest feedback about the neighborhoods they feel comfortable working in.  If they're misleading us, we won't be buying through them again.  If they do a good job, there will be several more sales and referrals coming their way.  It's definitely not a perfect science, but I don't think any of this is.  I mean, what's to stop the next door neighbor on the latest investment I've made in person from moving and the new tenants from turning the house into a crack house?

@Steve Morris

What do you mean by "how much exposure the property has on drive-by"?

@Anthony Acosta

That's exciting.  Congratulations and good luck!  If it were me, I'd just be honest and open a dialogue with her.  Ask her why she's behind on the rent, when she thinks she can be current, if she'd be willing to go on a payment plan if necessary, etc. and go from there.

I will say that I am not a good property manager and I ended up hiring the job out (once we found a great property manager).  I would buy stories, keep rents low, etc.  I'm a lot happier now that it's run like a business (and my tenants are much more clear on what's expected of them).  My advice would be that if you know you can run it like a business, you should manage it.  If you know you can't, hire someone else to do it.  It allows me to focus on other things and it's improved our bottom line.

@Ankit Khatri

I'm not suggesting you do this, but I funded my first real estate purchases by refinancing my home, borrowing against a life insurance policy, and taking the principal out of my Roth IRA.

I've never regretted it, but Dave Ramsey did say on the radio one time, "You know what they call people that borrow money to buy rentals?  They call them idiots!"  It hurt my feelings...  :(   haha.