All Forum Posts by: Jason Barnett

If the rental is in the red and has no hope of making money then find a nice retail home buyer and sell the house off to them.

As far as I know you don't HAVE to rent to section 8 tenants. The only limitation that I'm aware of is that if you will rent to section 8 tenants then you have to offer all of your units in a particular building to section 8 tenants. They don't all even have to be section 8 occupied, but they have to be offered to those people for rent.

Market Value: $140,000-$145,000

Mortgage Balance: $81,000
Rate: 5.875%

Monthly expenses:
Mortgage: $525
Taxes: $250
Insurance: $125
Total: $900
Estimated Rent: $1,250 - $1,350
Cashflow: $350-$450

Vacancy expense?
Maintenance?
Utilities?
Property management?

I don't know what it's like in your area, but one month of vacancy ($100 per month) might be reasonable. Maintenance will depend on the condition of the house, for argument's sake I'll call it $150 per month. I doubt you have to pay any utilities for a SFH, but I don't know your market. Property management might be 8% of monthly rent ($100) unless you do it yourself.

I'm taking educated guesses on those numbers and I'm estimating $0 cash flow per month (on average).

I'm sure it's a nice house to own and live in, but if the rent is really $1250-$1350 with 2% appreciation then this isn't a good rental property. Just sell the house if you really want to move.

Originally posted by "Ryan Webber":

I wouldn't necessarily not make an offer, but I would make it so ridiculously low that I know I could sell it. Which workshop of Russ Whitney's are you attending?

Spot on. You don't need to be embarrassed about an offer. Tell them you can offer $100K and see if they go for it. They won't... and then you'll say "well how close can you come?"

You have a lot of learning, but let me throw another suggestion at you. If you can get a great offer with $40K of profit then just partner up with another wholesaler (such as the people on this board). Let them do the "dirty work" and walk you through the process and split the deal 50/50 with them. Wouldn't you take $20K to let someone else teach you how to do this?

I'm an accountant, noobdog is 100% right. You might want to find an accountant that specializes in REI to answer those tax questions.

Bottom line: the LLC doesn't magically solve all your legal problems, it takes a comprehensive plan and that plan depends on exactly what you want to do.

If you want to find other people in your area to partner with then you absolutely need to find a REI club. There will be a lot of knowledgeable folks there that can talk to you about the local market as well as REI in general.

As for doing long distance property ownership the key thing is you need to find a good property manager. Most managers know how to do the day-to-day tasks (fire them if they don't :lol: ). What sets apart the good from the great is their experience as well as their communication ability. There are times when all is well, but you don't hear from a guy for weeks and you start to worry.

$15K closing for a $150K sale seems high to me. I usually figure about 6% of sale price for closing costs.

You can do a no-doc loan called a NINA (No Income No Asset). In a nutshell this is the closest thing to a hard money loan from an actual bank instead of HML. Just go to your local bank and ask if they will do this for you. They will run credit, but it doesn't hurt to ask.

Interesting questions Paul. Which international markets are you considering?

As for the domestic side I agree that US long term appreciation will lag international rates. I don't think it's quite as gloomy as you paint the picture. Sure 2006 was a down year, but so long as the US maintains most of the wealth / income in the world the real estate here will continue to rise. I think long term we're going to see China's income explode and once their GDP approaches and surpasses the US we will see a major shift. I'm too lazy to actually look up those numbers, maybe someone on the board will do it :lol:

I think you are spot on with this observation. However:
Not quite true. In fact there are many technologies that are already in place to make globalization available in your backyard. I certainly agree with the 'democratization of wealth' though. We are a corporate world where you get paid based on merit (mostly :wink:)

Originally posted by "Joe Good":

...So I look for partners, or set the deal up and get a cut.

Im not selling on your site. Hope thats ok.

Joe Goodrich

Hmmm, well that looks like selling to me... selling deals! :wink:

Seriously it's not a problem to tell people about the deals you've got. We've got an area for people looking for mentors and partners. If you want to find partners in that forum it would be great. The main thing is we don't want to have blatant self-promotion all over the site. All high quality discussion forums require moderation and our board is no different!