All Forum Posts by: Austin Fruechting

If you are essentially partnering with strangers, do everything to make sure you're protected. Have you already put up the money and purchased the house? I hope not but can't tell from your post. 

Ask him to read Rich Dad Poor Dad. Show him a lot of numbers and how those compare to traditional investing. And project out where you're at in 5, 10, 20 years with REI vs traditional investing.

So long as you're certain you can pay it off in the 15 month period go for it! I've used credit card advances/balance transfer checks as a method for short term cheap financing. The only risk is not paying it off by the end of the promotion period because then you typically get charged the high interest in arrears. As long as you're certain you can pay it off in the promotional period you're set. 

The best way to limit your liability as a landlord is to be good at it.  

5% on a 5/20 is typically what I'm getting.

As to the home warranty... they wouldn't charge you $ X a year if they didn't make money off of that with the repairs/replacements they'll actually perform... I'll side with their research and mathematical modeling and not pay them and just pay for repairs/replacements myself. 

As to capex - routine maintenance can lower these costs, like changing oil in your car... but the big ticket items will still come up and eat years of cash flow. The main thing is that those are factored in your analysis and are still making money over the long run. 

@Jay Hinrichs - exactly!  

I'm sure there's some decent TK operators out there, just go in eyes wide open. Here's the main things I usually see and why I *caution* turnkey: 1) WAY under-representing what your long term expenses will be.  2) Sometimes the rents don't seem in line with market rates. They always seem to be top of the top dollar. I question some of their screening and tactics used to put someone in at an inflated rent. So make sure the rent they're claiming is in line with the market and you'll be able to get the same rate going forward.  3) The work is sometimes crappy work. It looks ok in a photo, but when seen in person it's sloppy and just a quick lipstick on a pig. (I've walked a property that was supposed to be pretty well done for a out of state guy looking to buy and it was bad) 4) I've also seen prices where I have no idea how they appraise for it.  So not only are they charging retail, they're charging top of the top, and probably way above. Another one I saw they were asking $90k for. Nothing else in the neighborhood was even above $60k... and the one directly across the street was same size, layout, and almost same quality of finishes for just $53k (from the owner). The ones that actually needed work were showing recently sold on zillow for $25-35k.  So yeah, that's a pretty good rundown of why I don't like most TK from what I've seen. They often sell at ridiculous prices, with sloppy work, at possibly unsustainably high rent levels, and way under-represent expenses.... 

Maybe....

Originally posted by @Matt K.:

Originally posted by @Austin Fruechting:

Unfortunately I am flying out on the 23rd!! 

Best BBQ in KC: Q39 on 39th st (go for the judges plate with ribs, sausage, & something else, the chicken is amazing too)... and Joe's KC on 47th (Zman & fries!)

 Jack stacks rib sampler destorys all other bbq... Except for the zman lol

I will fight you! Lol 

 Jack Stack *might* crack my top 5 but never where I take people or recommend.