All Forum Posts by: Account Closed

This is the ignorance I'm pointing out. ANY property can cash flow. A property that cash flows TODAY can stop cash flowing TOMORROW. You are buying on the EXPECTATION that rents/expenses stay the same without making a business plan that considers future rents/appreciation/expenses. THAT IS FOOLISH!

I've NEVER bought a property that cash flowed initially. Not in the 70's or the 80's or the 90's or 00's. However each of these properties doubled in value in about two years and rent increases average 6-7% annually.

I believe you give up some profitability for cash immediate cash flow. And if you are giving up rent growth and appreciation where will you end up over your holding period? Let's say you buy a SFR at $100,000 that cash flows $100. Sounds good? To sell that property with a 6% Realtor com mission it will take FIVE years of cash flow to pay the Realtor. Still sound good?

My point is that you need to look at profitability over your holding period and you need to make an educated guess on TWO major factors, 1. Rent growth and 2. Appreciation. Yet so many investors don't use or understand these metrics. Thinking that cash flow is profit is foolish.

Do you NEED the cash flow or do you want to maximize profitability?

Video with tenant. Turn on faucets, dishwasher, stove, etc. Open windows, check screens. Ask tenant what was done prior to moving (on camera), carpets professionally cleaned? Cleaning service? Paint touch ups? Receipts? Know you local law on deposits and don't be bullied. Video is your friend.

You still have two tenants on the lease. There's probably only a 10% chance that you will be on an all new edition of "Cops" when the ex drives by at midnite and sees her girlfriends car parked out front and proceeds to remove the screen door and then you get the police call because she claims, rightly so, that she is on the lease and is not a trespasser.

I'd approach the guy and let him know that as long as she was on the lease you owe her landlord duty which could involve access when he is not there. If he can't commit to getting her off the lease I'd send them both notice of termination of the tenancy (sorry to lose a good tenant, etc.) and set up a new lease with the guy if he's interested.

This is a win/win for all parties. Also make sure the deposit on the original lease is handled appropriately.

It sounds like your commercial store fronts don't have commercial leases. If they are short term and not dramatically over or under market rents I would just use a GRM on the income compared to similar properties or just sales comps. If the only GRM comps are all residential I would adjust for a probable higher vacancy rate. Loopnet could provide a market cap range and your broker should have some information unless this is not a typical building for the area.

I would strongly disagree with this based on my almost 40 years of investing in non initial cash flowing areas. You will 99% have MORE profit on an investment in SCal, or NCal as long as you can afford a few years of negative cashflow and NOT sell in a low market.

My experience is that rent growth is 6-7% a year so negative becomes positive in a few years and appreciation rate of 9-11% is your profit. Definitely look at the historical numbers for the type and area of your investing.

How much of the equity that you have for investing comes from appreciation? That would be a good clue as to where PROFITABILITY is.

What is the market cap rate?

You're only a potential neighbor. Please don't knock on my door and disturb me. I work the night shift/baby is sick/wife's in the mood. If I'm washing my car give a friendly wave and if I seem receptive approach. Maybe do a Survey Monkey type flyer. You could also get the cops called on you.

I still think the implosion would be cool and you could possibly make some YOUTube money. In some areas of Indiana and maybe in a town near you the Volunteer, and maybe paid, Fire Department will use old houses for fire practice and do the deed for you. Maybe even some YOUTube money or America's Funniest Home Video money depending on your fire departments skill.