All Forum Posts by: Jacob Sampson

Boot them.  Where I live, if it is past the 3 days given in the 3 day pay or quit I can collect the rent and still evict because they didn't get it paid within the 3 days.  These tenants sound like a hassle, either way.

@Robert Harmon

Yeah, I get it.  I am always impatient and anxious to purchase the next deal.  I'm also a buy and hold guy and it sounds like we invest in similar purchase prices.  I generally buy for about $45 - $55k, in my area.

With the numbers you are talking about if you could save up $15k - $20k (not sure how feasible that is for you) then I think you would be ready to take your first step.

If $40K can get you a home in a reasonable neighborhood that needs somewhere less than $5k to get rent ready then here is what it might look like.

$10k ($8k DP and $2k in closing costs) gets the house purchased $5k in fix-ups and you are still left with $5k in cash.  For that scenario to work for me, the home would need to rent for, at least, $600 but preferably closer to $700 a month.

I always purchase on 15 year notes but, for a first step into real estate, I would recommend extending the mortgage as long as you can, to maximize cash flow.  Once you are comfortable with real estate in your area, have a larger stock pile of cash, and several other units, I would recommend doing 15 years notes.

To me, having to be at work everyday for 8-10 hours sucks.  As a society we are just accustomed to that particular scenario.  It's true, like poker, real estate is a grind, but so is a traditional job.

@Robert Harmon

Are you trying to buy and hold or fix/flip or any number of other options? My preference is the boring, old fashioned method of saving up cash. That being said, I recognize in some areas that would take a long time. Also, I need to admit that I have $2k borrowed against the HELOC on my personal residence for my most recent purchase. So...I'm a hypocrite.

You certainly know the area better than I, but based on the income potential I don't see how you get more than $400Kish out of the property, especially an older one that likely has plenty of deferred maintenance.

Even at $1900/month/unit I would max out at $350Kish in my area. 

I really like Godaddy.  Their support is fantastic.  That being said, web hosting and email is a commodity, go with the most reasonably priced, they're all going to do the same thing.

Couldn't agree more.  Vanguard no load low fee index funds are the way to go.  I invest in real estate but for diversification I also have money going into several Vanguard index funds.

@Michael Haynes

Math skills and self discepline will be far more important than passion.  Like poker, if done correctly, real estate is a grind. 

Mixing money and family scares me, start slow and small.  Make sure your mistakes are small ones. 

I would take the advice people have given in this post, get a realtor, learn the area you are going to invest in, define your goals and the strategy you intend to use to reach them.  Oh and start small!!

I would restate @Brian Mathews statement and say real estate has the potential of better returns.  There are people, this very moment, that are losing money from real estate month after month.  And not only does real estate have more hassle, the potential for greater returns also means greater risk.  If you put 40k into some no load index funds you can only lose 40k.  You invest in real estate and you have an infinate potential for loss.

on the flip side, 40k in mutual funds/index funds will take much longer than 15-20 years to produce any reasonable income. 

I agree with both of @Russell Brazil 's points.  Whether it be stocks or real estate you have the best chance of success when investing in what you know.  Local markets are what you know.  I think out of state as a first attempt at RE investing is pretty risky.

I think @Arianne L. outline the thought process well. 

I know it's the rockstar thing to do to be leveraged to the hilt, but, keep in mind most people you are hearing from have less than 8 years of experience which basicly means they have cut there teath during an abnormal increase in real estate value due to an abnormal tank in values.

Look for advaice from someone that has been making money in real estate for 25 years (which is not me).  My point is that playing down the risk of debt assumes we have more control over our markets than we really do.  You have taken your first step into this game.  Spend a little time protecting the progress you have made.