All Forum Posts by: Ken Hicks

Can you advertise a property that has bedrooms in the attic with out the proper exits? I know you can't with rentals.

This brings back memories of the properties I looked at in the past. HO says I just completely remodeled the bath and kitchen and bedroom. I take a peek.. mmmmmm Looked like they used scrap wood from the dump. With out inspections HO might take big short cuts and the home won't pass an inspection.

What... You don't want to be able to retire before 59? I don't blame you. Could you retire if you had 10 cashflowing properties that made you $500 a month each? I think that will be more than SS will give you. Who knows those properties might rent for $1400 a month and give you a $1000 cash flow each month when you turn 40. Or they could give you nothing.

I would look at a money market account at your local bank. You can only make 3 with drawls a month from it. They make about 4% but until you get rolling I would do it that way. You never know when you might need that money then you would either have to take a penalty to get your money out of an IRA or use a credit card charging you 18%. I made the mistake by putting lots of money in my 401k then I needed something I put it on the credit card.

I just read a book by Dave Ramsey. "The Total Money Make Over". I would highly recommend you read it. Yes some of it is boring when those people send in letters. I like his idea, "live like know one else now, So you can live like know one else later".

75% of my retirement is in RE, as a mater of fact all my RE cash goes to retirement. IF nothing more keep your money in a money market account at your local bank. Stocks would be the best thing as long as you know what your doing. Most financial institutes that I talked to don't want to help you to much unless you got a few hundred thousand invested with them. I know I have to check my mutual funds monthly and make sure the trend is still at least even. 2 months of decline I'm calling my guy on the phone and asking questions like "Whats up with this fund"? If you get in with a company that matches 401k then max out at what they match with.

Your best bet is to interview 3 financial institutes write down questions and compare the answers.

50% of gross rents might work in some areas. That statement is the same as using a cap rate. Usually I find out that Realtors don't include some fees on properties such as landscaping, Snow removal, stuff like that. I never bought a multi unit apartment complex but if I was you could sure bet I will be doing more investigating on NOI than just a cap rate or 50% or gross rents. Sometimes when a city extends the city limits the current owner of a property does not pay the new city tax, but the new owner will. Just like taxes will get reevaluated for new taxes when the property changes names. HOA fees could eat you alive as well. Yes Cash flow is nice but I am more interested on my return of the money I put into it. I don't really want to give $100,000 and only get $4,000 back annually. Maybe $35,000 in and $8,000 back annually.

I love the fact that no one (That I seen) asked what the Laundry mat usually averages for a income, and other items that might be not known for the NOI. Yes I don't think I would get off my couch to look at this deal unless the seller is serous. I get about one call a week from someone telling me they have a deal. Usually I am the 50th person they talked to.DEALS ARE NOT FOUND, THEY ARE MADE. I read that somewhere.

What would the Cap Rate be on this property?

What is a good Cap Rate for a property?

What type of ROI do you guys look for?

I am lost how did you come up with the NOI with just those numbers listed?

That would be nice.

I just abandon the thread. If I was that important in the thread, I am sure I would get a PM. I have done that a few times. I wish new guys to the site would read past posts. I guess that is a touchy subject. I am sure I posted questions that were in past posts. I am sure we can make an old post active if we had a question.

anyone??? seems like this could be a good feature.

Either way you do it I always include a 12% PM fee when evaluating prospect properties. I stated in a few post were I had to sell a property because I accepted a job traveling. I Lost about $500 and my time on that deal. You just never know what is around the corner of life. If you buy a property in PA were you live then you get a job transfer to FL and the new PM fees will cut way into the cash flow or even create a negative flow and then they take longer to fill the unit you will get into trouble. But if you include the 12% do the PMing yourself and keep saving that to pay down the mortgage or yourself or save for another property that would work. just my 2 cents.

If you can save $60k a year doing the PMing yourself couldn't you hire someone for $40k? If then they only have to work 16 hours a week that will give them 24 more hours a week to help you.

Just using Mikes number for examples. I know when I get to that point were I'm paying my PM $40k a year I will be doing some serous investigating on contracting work out to a contractor for repairs/calls and a Realtor for showing the property and evictions.

I thought subject to was taking the property with the current mortgage?

HML can get extremely costly 15% for 100k mmmmm Yeah you need to find one heck of a deal. you might want to find a pattern that has money. I know lots of people that have money, and they don't act like it. I got a call from a friend wanting to barrow my 4 wheeler. I felt like writing him a letter "Dear Mr. Millionaire. please buy your own 4 wheeler". I did let him barrow it. The guy made $80k last year just in his stocks. and that just what I know of. Any way yeah I would either live in and rehab the houses then rent them out or sell, or find a partner. Yeah you give him 50% of the deal so profits won't be much either. Hope this helps some. Keep in mind you need to take care of todays debts first.