All Forum Posts by: Joe S.

Jake Baker and his company Bookkeepingre.com (a BP recommended Accounting agent) have been stealing from me for months. Regardless of the services you agree to, he will automatically charge your payment method incessantly regardless of your needs, and refuses to respond to any form of communication. He and his company are actively damaging Bigger Pocket's brand and reputation. He's a danger to BP and your business alike. STAY AWAY! Feel free to contact me for more details.

Hey Everyone,

Looking for some advice here. I wanted to get into real estate investing the easiest way possible and I figured using rent to retirement would be the simplest solution. 

Their projections showed a 17% yield with $789 cash flow for $75k down. 

I am over $100,000 cash into the deal and losing money, negative cash flow ~$200 a month. 

This is a new construction and so many things needed to be fixed by the property management even though they said everything would be fixed from the inspection report. They refused to provide pictures and said that it's just how it is.

The provided loan company was also terrible to work with. They were super pushy and had very outdated technology. Loan was instantly sold to NewRez which has been pretty good for a loan holder.

Any recommendations? Should I wait for the end the year and hope for rates to drop? Or should I just sell the property and take the loss? Is the better to take the loss in the next calendar year? 

I appreciate any advice!

Peter

First time home investor.

It's a great question and one probably a lot of us investors don't think about often enough. I've started contemplating it more the last year or two. I retired from my day job in 2021, did some contract work and now am more or less fully retired other than running the rental property business. 

I intend to do one of two things: either fully develop the potential of my brokerage to expand PM, maintenance & repair, and sell my entire portfolio & the business together - OR, start peeling off one or two a year in a few years when I turn 60 and try to wind it down to nothing before I'm dead or too feeble to know what's going on, and just accept the tax hit. None of the kids/grandkids have any interest in running this type of business, so the reality is just to wind it down at some point in the not-too-distant future. 

An alternative plan: put everything into a stable trust, with a good executor, and allow your portfolio to continue to provide income to yourself and your heirs for however long into the future until your heir(s) unwind the trust. With only 5 houses left this is probably unrealistic unless they're strong rent generators and the costs of management & maintenance are reasonable. 

𝐒𝐭𝐢𝐥𝐥 𝐰𝐚𝐢𝐭𝐢𝐧𝐠 𝐟𝐨𝐫 𝐭𝐡𝐞 “𝐫𝐢𝐠𝐡𝐭 𝐭𝐢𝐦𝐞” 𝐭𝐨 𝐠𝐞𝐭 𝐢𝐧𝐭𝐨 𝐫𝐞𝐚𝐥 𝐞𝐬𝐭𝐚𝐭𝐞? 𝐇𝐞𝐫𝐞 𝐢𝐭 𝐢𝐬:

𝐈𝐧 𝐉𝐮𝐧𝐞 𝟐𝟎𝟐𝟒, 𝐨𝐧𝐥𝐲 𝟔 𝐨𝐟 𝐭𝐡𝐞 𝟓𝟎 largest U.S. metro areas had housing inventory above pre-pandemic levels.

𝐈𝐧 𝐉𝐮𝐧𝐞 𝟐𝟎𝟐𝟓, 𝐭𝐡𝐚𝐭 𝐧𝐮𝐦𝐛𝐞𝐫 𝐣𝐮𝐦𝐩𝐞𝐝 𝐭𝐨 𝟐𝟎 𝐨𝐮𝐭 𝐨𝐟 𝟓𝟎.

This isn’t just data. 𝐓𝐡𝐢𝐬 𝐢𝐬 𝐨𝐩𝐩𝐨𝐫𝐭𝐮𝐧𝐢𝐭𝐲 𝐬𝐡𝐢𝐟𝐭𝐢𝐧𝐠 𝐢𝐧 𝐫𝐞𝐚𝐥 𝐭𝐢𝐦𝐞.

Markets like Austin, Denver, and Memphis now have significantly more homes available than they did in 2019, creating real chances for creative investors who know how to move when others hesitate and dawdle.

More inventory = less competition

Less competition = more negotiating power

More negotiating power = better deals for you

If you're still sitting on the sidelines, ask yourself:  what exactly are you waiting for?  

Yes most of them are more like yours, not outright scams but semi-scams. At the end of the day the end result is roughly the same.

Indy is a great arbitrage opportunity, lots of crappy real estate that's easy to sell to out of staters who don't know what they're getting into at a substantial markup. So it's less like a curse and more like market forces in action, at least until people wise up (holding my breath starting now).

And no it's not just Indy, you could replace Indy with a dozen other cities and it would be basically the same thing. But I can only say I have personal experience in Indy having bought hundreds of these properties back at the 2-3 year mark.

You say you've heard stories from other Californians, let me ask you this, what percentage of them that have a horror story? My 80% number was just pulled out of thin air but I wouldn't be surprised if it was in the ballpark.