All Forum Posts by: Daniel Dietz

I watched a 'demo' for each and played a bit with each. For me/us, Rentec seemed more simple and intuitive for someone who is not a full time book keeper.

We have yet to find anything it does not do for us. The first year and a half we used it for all those function other than accounting. We used Sage which I use for my dayjob business, but it is WAY overkill for rental accounting. So we are working on getting things all set up in to also do our accounting starting in 2020.

They also have a great 'Knowledge Base' in the program and also tech support by phone.

Dan Dietz

@James Galla, I am sure it is different in all markets. My partners and I ARE in "small town Midwest" and have 30 units in a town of 10,000 and county of about 60,000. It might be a different story in bigger metro areas.

Most of ours are 2-4 units with a few SFHs thrown in. There is definitely a segment that would prefer the SFHs.... usually family with kids and the like. The "downfall" as investors goes is that in our markets, we can find 2-4 units that rent at "The 1% rule" so make a decent return. On SFHs, it is hard to find be "the 3/4% rule", meaning that on a 150K house you would maybe get $1150 per month. Where as on a 150K duplex we can get $1500 - $1700 all day long. Make a BIG difference in profit over the long haul.

Some of the reasons many of renters prefer NOT being in a SFHs are that in our they have to do their own grass and snow etc.... They also cost more to heat and cool etc....

People DO definitely prefer "side by side"(meaning not over/unders) as they are MUCH more quiet.

One advantage we have I think over larger markets is that we have less than 1% vacancy. We have a great blend of tourism, industry, 2 colleges in our county, agriculture and vacation homes. We are also only an hour from Madison WI so have a lot of "commuters" that want to live in a small town but work in the city.

Dan Dietz

I am sitting in the airport on my way home from BPCON2019 and catching up on the forums.

Met some great people and lots of great discussions! A couple of smallish people like me who have great track records in smallish town Midwest were talking about the possibility of someone with equity they want to cash out investing in our less competitive markets by partnering with us.

So I'll through this out there..... our track record is 30+ units, we run less than 2% vacancy (we use 5% in our pro-formas), zero evictions, a waiting list of well qualified tenants, and a lender lined up at 20% down on a 20-25 year amortization.

We have done out last two deals where our Private Money Partner bring all of the 20% down, we find, manage rehab if needed, and do all ongoing PM and business management. We split cash flow which runs about $200 per door per month. This is for 2-4 units 1980s or newer.

When we factor in appreciation of 2.5% (historically 3.75% over the last 50 years in our area), loan paydown and cash flow there is a return of 9-12% for each of us. This would be on a minimum 10 year planned hold and likely much longer.

Would this type of investment be of interest to those of you with equity to deploy? The deals we have lined up for the rest of this year are duplexs for about 160K to 180K and 4 plex in the 280K range.

What would or would not be good about this kind of deal vs 'turn key' other 'hands off' types of investments?

Thanks, Dan Dietz

I worked with a lawyer named Jarom there that I was VERY happy with when setting up LLCs for SDIRA and SOLO401Ks.

I sent him a list of my questions ahead of time which really seemed productive to me. Dan Dietz

We used KKOS to set up two of our LLCs where they involve SDIRAs and SOLO401Ks. 

Very positive experience. We worked with an associate named Jarom. They are a bit pricey when we have needed small things since then on a hourly basis, but if you have your info gathered very efficent too. The cost of the LLC work was very reasonable at a 'package' or set price, timely etc... I will be using them again for a couple more upcoming Self Directed LLCs.

Dan Dietz

@Brian Eastman thanks for the very detailed answer. Seems to make sense and I will check out your site for that article too.

If I am understanding things correctly, say I had say 50K in cash, and I could either put that directly into a syndication as cash or put it into my SOLO401K and THEN put it in the syndication. If I did a rinse-n-repeat of that say a couple times over 10 years, I would very likely have a larger return in the end in the SOLO401 as no/not much tax (in a typical syndication) would be do on that, until the time I chose to make withdrawals from it, correct?

So assuming this is not funds I would need to access, the SOLO401 would have an advantage there?

Are you going to the BPCON19 Conference? If so, I would love to touch base and thank you, and some of the other Pros here, persoanlly for the help you give us all.

Thanks, Dan Dietz

Hello All, 
I am looking ahead in my investing career and thinking about the day I might no longer want to do buy-n-hold rentals myself and instead invest in something more passive like a syndication. 

I currently own rentals in 'cash', in SDIRA and SOLO401K and am going to continue buying for probably the next 5-10 years at least. 

I realize that within the SDIRA and SOLO401K profits are taxed differently when leveraged, with essentially no taxes due within the SOLO401K. Does this also hold true when investing in a typically structured syndication which is almost all cases that I am aware of are using leverage?

If there is a difference, what might that look like on say an investment of 100K that turns into 200K in 5 years?

Thanks, Dan Dietz

I am wondering if any of you professionals could comment on what you think of Rentec Direct from the accounting side of things if you have used it? We have been using it for the tenant side of things for a while and like it for that. We gave our accountant some sample reports it can produce and he seemed to think it looked fine.

We have been using our old Peachtree Accounting that we use in our 'day job business' for properties too, but are going to be replacing that at work and thought it would be good to take a look at something simpler and more property specific. 

@Andrew Perkins that is correct, our share of the split replaces a 'property management fee'. The better we manage, the more we both make. That is our incentive to go above and beyond what a typical PM would do - 50% of every dollar saved or made in cash flow goes into our pocket :-)

We also set these up as LLCs, and if we decided we no longer wanted to or were able to (say do to injury of death etc...) the PM fee would be deducted from our half of the returns, since that was 'our contribution' to start with.

We have been doing some buy-n-hold deals lately where the the Private Money Partner (compared to lender) put up ALL of the down payment - 20-25% - and we do ALL of the finding, rehab management if needed, securing funding and all ongoing PM and overall management.

All cash flow is split 50-50, and all equity growth will be split 50-50. Our plan is to hold for at least 10 years. When it comes time to refinance or sell the Private Money Partner first gets their original contribution back and THEN all else is split 50-50.

We are planning on seeing returns for EACH of us from about 9-12% on the original equity put into it. The money person gets a steady, reliable stable return and we get about 4 times what we would by simply doing PM for a stranger.