All Forum Posts by: Kate Szeto
Kate Szeto has started 2 posts and replied 13 times.
Post: making profits in rental property
- Posts 13
- Votes 2
Quote from @Bjorn Ahlblad:
@Kate Szeto welcome to BP. For me number one is learn to underwrite. How else can you tell a deal from a dog. Number two is don't believe the numbers in a listing. Get your own numbers wherever possible-new insurance, new property tax etc. Include PM cost even if you are going to manage. Don't even try to manage unless you have learned how and know your local LL tenant laws. Three, Just because the property is off market does not mean it is a deal. You need to always be able to evaluate the offering. Four, always have enough money in reserve so you cannot be forced to sell if the market goes sideways and know your market rents! I could go on and on.
Four years ago we bought a 12 unit, opened a separate bank account and deposited 50k into the account. We collect all the rents and pay all the expenses out of that account. There is 420k in that account now minus the original 50k leaves 370k. And the property value has more than doubled largely through forced appreciation. My wife and I have other rentals as well which she manages. Bottom line know the numbers and know what you are good at.
That's amazing! Is that a 12 unit building? Did you manage it yourself, or hire a property manager to do it?
Post: making profits in rental property
- Posts 13
- Votes 2
Quote from @Joe Villeneuve:
Here's the most important answer to all of your questions, but first you must answer this question:
"Do you want to be a collector of money, or properties?"
If the answer is "properties", then I don't have an answer.
If the answer is "money", then the answer is simple...."don't buy properties that won't cash flow in the first place".
There's no trick, just math. "If the math doesn't fit, you must quit".
Definitely cash flow. Mine is an investor's building and there are owners who have been in the building for a long time.
Post: making profits in rental property
- Posts 13
- Votes 2
Have a dumb question to all the real estate investors who rent out their home/apartments AND are making profits from your property: what are your success factor(s)?
I have a rental apartment in New York that can get good rental money, but with the high expenses of brokers, property managers, contractors, fixing things here and there, providing furniture and supplies to tenants, building's maintenance work required by local law, building's renovation cost shared by all owners, and real estate tax, I found it very hard to break even (let alone make profits) after five years of renting out my property. I have a small loan on the property.
So I am curious to know how you all seasoned investors make money from rental properties - do you hire property managers or manage the property on your own? How do you keep all your expenses low? There are so many real estate investors out there so this business DOES make money. Maybe I just don't know the trick of the trade. Would be really helpful to hear from other's successes stories.