All Forum Posts by: Jeff C.

I've been watching the market here bleed off for months. I don't think anyone would call it a "crash" yet, but it's definitely softened significantly. I'm really not loving this market at this time!

Yeah, profit that you never made isn't taxed. Get it? ; ) Also, the title of this thread isn't "I borrowed a bunch of money against a property in a BRRR".

I don't think anyone is missing the point. The title of the post is literally "$128,000 profit...". No profit has been made until the property sells. Borrowed money is not "profit".

These numbers don't look right. Financing around $150k the payment will be around $900 a month. Property taxes nearly $400. HOA is usually a couple hundred a month. Vacancy? CAPEX? Maintenance? Management?

Do you know exactly what you're looking for? Rough house specs and what part of town? Or do you at least have a budget in mind?

It just depends on who's asking. I have a couple of friends that I'm pretty open with, but for the most part I prefer to be discrete. I don't need to create any more competitors.. not that the majority would ever act on it even if I outlined my business plan step by step. 

Well, given that whether or not the neighborhood has "noise problems" is one of the questions on the mandated Transfer Disclosure Statement in California, I can't see how stating that it doesn't have them would be a violation.

@Chris Jensen

I started buying investment properties in 2006, have done about 100 deals since then, and haven't had a losing deal EVER. I'm a more conservative investor than most, and that's stopped me from doing some deals that would have made me money.. but it's also meant that I've never lost money, and I'm just fine with that. Here are some lessons that young hopeful investors don't want to hear.

1: Despite what you've seen over the last 8-9 years, prices can move in more than one direction.  If your model projects (and worse yet relies on) consistent value increases in order for your numbers to work, you very well may end up with a problem.

2: Rents can also fall (gasp!). If you've leveraged yourself out maximally, refinancing your property every chance you get and keeping razor thin cash flow might result in negative cash flow if things turn. This is also likely to be at a time when the economy is poor and your own day job may be in peril. Would you be able to feed all of your units monthly under such a circumstance?

3: Don't get caught up in mania. It's the nature of markets that once nearly everyone is in agreement that something is a good idea, it's probably about time to take the other side of the bet. You have to ask yourself.. who is left to buy? When your hairdresser, gardener, and grocery bagger are all becoming property investors it may have jumped the shark. Anyone else feel this happening again right now?..

4: Don't get involved in something you don't fully understand. This is a corollary to #3, but it's easy to see others seemingly doing well with something and want to jump on board. It's better for you to miss deals while you educate yourself than to get involved in a deal that turns out to be a loser. It's especially true for your first deals that they absolutely must be winners. Messing up on your 50th deal will probably not kill your investing career. Blowing up your first or second or third deal just might.