All Forum Posts by: Larry Turowski

@Carlton Blair Kutas I tried investing in stocks before real estate. And I wasn't very good at it. Stocks offer the benefit of extreme liquidity, and your analog is a decent one, but 1) stocks are more volatile, 2) stocks can not be leverage like real estate, and 3) stocks are more difficult to scale as an investment.

If I were a guru that could out perform the index I could start a hedge fund, out perform the index by a few percent and scale by having investors in the fund and getting a cut, but I'm just not that smart. And I don't need to be to well out perform the stock indexes in real estate.  What I sacrifice is liquidity.  But since I flip in addition to hold, I'm always pretty liquid.

This is the best answer.  For value investors, there are always deals. It’s always a good time to buy a good deal. And if you want to lock in gains or have a good deal that selling another property would help you acquire, it’s definitely a good time to sell.  That’s why I’m both buying and selling right now.

@Deborah Fung my condolences on the loss of your husband.

As others have said, get educated first. These forums for a great place to ask pointed questions. Phone number one thing to do in my opinion is meet other investors. You can direct message people Peter asked to have a 20 minute conversation with them on the phone. Investors take them out. Ask how they got started etc. Also read books, read the forums, start analyzing deals, etc. Once you to the analysis paralysis stage, that is, where you are not really gaining focus, you are just changing focus, then you’ll want to move into to focusing and finding a deal. 

1) Landlord punitive legislation. The moratorium on evictions cost me 10s of thousands of dollars. They could have allowed evictions and then had the government pay at eviction to keep people in. Instead they turned me into social services with some but inadequate support.

Also rumblings of rent control, good cause evictions, etc.

2) Having too few units. Having one or two is the worst. Those are the people I buy from. You do the work yourself. And it is hard to get contractors for little problems.  Once you scale to 5, then 10, then dozens, all these other problems become part of the soup. There will always be bad tenants. There will always be needy tenants, etc. But overall it’s great. You have contractors who will do little jobs because there will be lots more. You have a management company or, in my case, an assistant, that does most of the management. It’s now a business rather than a job. 

@Angel Wu 8% CoC isn't even particularly good. You don't share an actual deal example so it is hard to say. Maybe you are looking in A class neighborhoods?

@Dane Davis let’s start with this. What research have you done, what books or articles have you read?  And what did they say?  Did any of them say get traditional financing?

Cap rate is the calculated return in investment if you bought the property outright, without a mortgage.

It is not salary.  It is usually exaggerated.  And it is not cash flow as you may have capital expenses that you have to pay.

You’ll have a mortgage. That will need to be paid out of that theoretical 72,847, as will capital expenses.

Everybody has their own interests that may not be aligned with yours, even someone with fiduciary responsibility. We need to navigate that. Even if they weren’t a dual agent their interest is to sell quicker. Dual agency further mis-aligns their interest but it doesn’t really matter. You are in control. What is in your interest? 

Your best deal will likely come early not moths down the road. Obviously your realtor thinks the buyers may walk if you counter too high.  It sounds like you are fine with that.  If there is a lot of interest in your house that that is a risk worth taking  If you are not getting a lot of interest and you really want to sell, you may not want to risk taking less months down the road  

There’s a million of these threads. They’re all the same. Some saying find a deal first.  They buyers will be there. Others saying get your buyers list first as you don’t want to put houses under contract without knowing you have a buyer. James Wise saying you need to be a realtor. Others correcting him. The wheel keeps turning.

@Espen Bast Sørsdal I also invest where I live, Rochester NY.  I’m fortunate that Rochester is an excellent rental market.  And a acceptable flip market. I do both. my goal is to increase my real estate net worth by 15% or more per year.  I can do that here. But like you, I’m wondering if there are better places/avenues.