All Forum Posts by: Dennis Tierney

@Jon Holdman

Sorry for your troubles. Water can be so destructive. Hope your diversion plan works.

Andrew:
I bought my first apartment at 55. As you, I'm not looking for another job so have them all managed by a 3rd party professional management company. Age is an impediment only if you let it be one. I'm buying for passive cash flow for retirement income. As soon as I have enough cash flow I'll quit the day job but probably continue acquiring property for syndication as it's too much fun to quit.

If you are planning on getting a mortgage anyway you'll still incur the closing costs for the mortgage so why not buy the home now with a mortgage as the interest rates will probably be going up as Bernanke winds down the QE.

Don't walk. Run from these scammers as fast as you can. There is no reputable commercial broker I've used that works that way. They get a percent of the purchase price from the seller, just like a home real estate agent. Now if you use one as a buyer's agent you may come to some agreement on a small commission but nothing as inappropriate as suggested by the agents you've met.

@James Miernicki

I am not a lawyer, but, my concern would be if a law-suit occurred involving the property owned by the trust would that then put all of the other assets owned by the trust at jeopardy? You may need to run that by your attorney.

@Robin Schumacher

I was in a similar siruation as you and concur on your need for asset diversification. I saw a number of people in 2000 and again in 2008 who were 100% dependent on the stock market for retirement and had their net worth cut in half at or near retirenment. I have slept a lot better since I began changing the assets into real estate. I disagree with your avoidance of any leverage though as it significantly boosts your return and adds another component of tax free gain when your tenants every month pay down your loans. That's also something you can't get in the stock market. As to your plan on using it for retirement income that is also my plan, but, how are you going to do that if your wife is the propertry manager? How does she retire? That is why I have chosen multifamily as my vehicle so that I can have cost effective professsional 3rd party management and all I have to do is manage the mangers and cash the checks.

I concur with the others. I use 3rd party management companies and haven't had a problem with their ethics, but, you seem to have found an unethical one. Make sure if you hire another to get references and talk to the people who have used them to be sure you are getting a trustworthy management company.

Will and I will have to agreed to disagree. I have owned apartments in a SDIRA since 2007 and yes they have nonrecourse loans and I'm happy that I have guaranteed equity gain every month by the tenants paying down the loan. One of the biggest advantges that is rarely mentioned on biggerpockets is the diversification of assets that a real estate IRA allows you and is the main reason I did it. I no longer fear a big drop in the stock market as most people do who are dependnet on the market for their retirement funds. I would have lost a lot of $ in 2008 if I had not made the move to have a SDIRA and retirement would be a lot scarier if I had to depend on the market.

@Zachary Kowalik

Welcome! I own 2 apartments in Iowa, one in CB and one in West Des Moines. With the legislature passing the commercial property tax reform this year I feel it will be a huge boon to apartment owners over the next 10 years . As the taxes drop the income goes straight to the bottom line. It may spur more apartment development though, time will tell. It certainly should be a business draw. By the time you are ready to scale up to apartments if you so chose the taxes should halved. Good luck.

@Alex Smotherman

While your stated goal is financial freedom you can't realistically manage a rental property and work 120 hours a week at another job. I also own real estate for the same reason, but, am not looking for another job so have the real estate professionally managed for me. I don't know how you'd have the time to flip property unless you spend the two weeks off working on it, but, then that takes away from the family time. You and the wife will have to decide which you want first a family home or rental property and that's a discussion you'll have to have before moving forward. Good luck.