All Forum Posts by: Mark Kelley

I'm renting an AirBnB in Portland in August. The house is advertised as not having an air conditioner. Anyone know if it's common to not have AC in Portland?

@Julie Haveman paying the HELOC down sounds like a good idea.

@Trevor Ewen Thanks for sharing your perspective.

The point you made about the relationship between the RE market and broader market is one of the reasons I threw out this question. 

If the housing market dives, it seems highly likely my stocks are likely down as well, even if it's a less aggressive mix as you mentioned. This would put me in a position to have to sell stocks at a discount / potential loss in order to buy RE at a discount. 

I keep a fair large cash account, though it's unsettling to keep a stockpile of cash that isn't growing while waiting for the buy opportunity.

Are there other strategies you know of for mitigating this risk?

One approach I was considering, though I admit isn't fully thought through, is to pay off the mortgages of a rental house or two instead of keeping cash in a cash account. Paying down the mortgage gives me an immediate return by paying down interest, and in a down market I could mortgage the paid-for properties (which are worth about $600k today) to pull a few hundred thousand dollars out to start buying properties at a discount. I might be refinancing against lower property values if the market is down, but I figure that's OK since I still own the property and can ride the prices back up over the next decade.

Thoughts on this idea?

@andrew 

@Andrew Michael great comment and thanks for sharing the script. I'm curious how much of your time these calls take? If a prospect is  showing they aren't motivated or the deal isn't looking great, are you bailing out of the call quick or still trying to find some way to make a deal work?

Thanks for the knowledge @Jason Bott

@Benjamin Eccles I'm curious about others' thoughts on this as well.

In my rentals at $1800/mo, I find it hard to imagine that annual expenses over time will average to be $10,800 ($900 per month x 12 months).

Perhaps the 50% rule becomes more relevant as monthly rent rate or property quality goes down?

Out of pure curiosity, since I've not heard of aluminum wiring or the associated risks, how does the insurance company know you have aluminum wiring? Do they require a test? Or is this an exclusion in all policies that a property is not covered if it has aluminum wiring? Thanks for bearing my ignorance. 

I'm curious what other investors are doing while banking or investing cash flows while saving for next down payment or all cash purchase. Care to share?

For my part, saving over a 3-5 year period before my next RE purchase, a time frame which I consider meets a minimum time horizon for a 'long-term' investment, I invest monthly cash flows with a dollar cost averaging mentality into a mix of stock market index funds, growth stock mutual funds, and ETFs.

It doesn't seem too risky to let him stay through his desired move out date, and it gives you time to start lining up or finding another, perhaps better, tenant.

I have faced a similar situation in the past. I think it makes sense to work with the tenant to ensure they move out on time, leave the place clean, and perhaps get out of the place for a couple hours so you can show space to prospective tenants.

With the tenant breaking the lease, are you expecting to keep the entire security deposit? 

Tenant probably wants out for any reason, pest, garbage odor, noise, or otherwise. Start looking for a new tenant right away to minimize vacancy. Solve the pest infestation if there is indeed one.