All Forum Posts by: Gary West

Great looking rehab! Im very impressed. Has it sold yet? Can you publish all your final project numbers?

That's my goal too. Property #1 will be paid in full in March. Will want to add one other this year. Still trying to decide to build or buy.

Thanks for the rip...Rich. Ill try to ask more intelligent questions in the future...

I am nearing pay off on my first property and am considering all of my options for acquiring investment properties. I think most of you will say tap into the equity of my first home and buy four more.

The other thing to consider is that I have a vacant residential lot that is paid for. The lot costs me 360 dollars per year to own with tax and HOA.

Should I build (SFR) on my lot or should i just buy a used SFR?

If I build it would be a modest 3 bed 2 bath with a detached car port. Im thinking it would cost around 75-80k and would command 800-1000 per month rents.

If I buy a sfr im assuming the cost to be 90 -110000. 100 percent financing. with an interest rate around 4%.

What are your thoughts? Ask away if you need anymore data.

Thanks so much.

Harry,

Im so glad you chimed in. You were exactly the math guru that I was hoping to lure onto this thread. Your advice is always spot on.

Ive read and re-read your post now im going to re re read it and then re re re re- read it. Then Im going to mull things and by February it will most certainly have some effect on my actions.

Thank you sir. Im so glad there are Nerds in the world like you. :o)

Shaun,

Thank you for considering my situation.

I think that the only way to sum this up is by this analogy:

If someone gave you 10 dollars and it was the last 10 dollars you would ever be given, What would you do with it? Your debt cost you 50 cents per month but totals 9 dollars. Would you use the gift money to pay your debt or would you keep paying the 50 cents per month and use the remainder to create a sustainable income for yourself.

However I totally see the value of paying off debt and i will. I just need to weigh it out a bit more and do the smart thing. Currently I feel that the smart thing is to create an income that will be there after my day job comes to an end.

Having said that, a very small portion of my debt costs me more than I would make in an investment. So at the best opportunity Ill pay it off.

I can be debt free in 16 mos IF and only if I stop investing. This would put me behind in my investment plan. How much? I dont know. Maybe I should do a spread sheet on that part as well.

Thanks for the idea. Thats what ill do next.

I appreciate you much.

The projections are the fun part. Maybe not the 8 hours, but the end result was completely exciting.

property number 2 paid off in 21-24 months resulting in 2400 dollars/mo Passive cash flow

property number 15 paid off in 5 months, with 18000 dollars/mo Passive Cash Flow.

Now i just need to quit talking about it and execute, because right now I have zero paid off with 1250/mo cash flow.

Actually when I compare apples to apples there is about 4 year difference between the plans. My mistake was using a 30 year term for the "4 at a time" plan while using a 15 year term for the "one at time" plan.

The 4 year difference added to the possibility of inflation and higher lending rates makes it the superior plan.

Ill look closer and consider buying 4 this feb instead of 1.

Thanks Lynn,

I had not considered an inflated market or interest rate changes in my plan. You make an outstanding point.

I just spent 8 hours creating spreadsheets for 15 different properties. One with the "one at a time approach" and one with 4 active mortgages at a time. With no regards to interest rate or home price changes the time difference to goal was only a year between the two.

Now I need to make some tweeks on "what ifs" and maybe learn a little more about tax deductions and liability issues.

Hi Kristin,

Thanks much for the input. I think I have my problem solved. Im paying off a little bit of it and letting the rest ride until I achieve my investment goals.