All Forum Posts by: Matthew Becker

Quote from @Jenning Y.:

Haha, it's funny. I am an investor from Houston TX and own rental properties in several states including CA,UT,ID,FL and of course TX. The only property that I regret bought and want to get rid of is the one in my hometown. The main reason is, holding cost including property tax and insurance etc. are too high, and even rents increased but costs increased even more.

I agree that it is easy to underestimate costs (management and repair cost etc) for OOS investing.  But choosing area with low holding costs(low property tax or insurance, or capped fixed property tax like CA) can offset some of the drawbacks. So it really depends on investing strategy.  

Even let me do it again, my hometown is still the last place that I want to invest. 

Where in Idaho? I hardly hear it mentioned 

I think out-of-state works with a small fund, seasoned people running it and low overhead.  One that does not have to pay the managers with the fund money but makes its money based on production.  Also, one that the owner put 20% or more in and they don't charge heavy fees.   Then, it is more like a partnership.  The last fund I did is full, so I am not selling anything. My investors are happy and doing well.  1st phase was 2.7M built, 28K rent a month.  The next build will be more like 3M with 28K rent, not quite as good, but we have enough dirt to do another 5M build on it.  They just had to send money and do nothing.  If I could find a fund that produced that somewhere warm in the winter, I would put money in just to write off my winter vacation.  I would prefer a beach as well.  

I would no buy but at minimum wait to buy a condo in Florida and pay $100K less in a few years. 

Based on what I am seeing, that does not sound safe.  

Insurance could double, or you can't insure, or they decide the building needs 2M in structural repairs.  Don't walk away. Run. 

Quote from @Steve K.:

Nobody should ever invest out of state. Unless that state is Colorado. 

 Well, other than Idaho?  I am sitting in Boulder right now.  Meet for a beer tomorrow and bring me a deal.   Making numbers work in Bouder or anywhere in CO. maybe Aurora is tough, but who wants to go to Aurora?  I am going to the pub for a cheeseburger.   

I know nothing about Canadian real estate except that it is very expensive.

What is your income-to-rent ratio?  Can you buy things that cash flow? 

I live in Idaho, which is Gun, freedom, family, God, and Landlord friendly, and it is gorgeous with lots of water.  Generally, our tenants take good care of our properties and leave them not trashed.   I own many properties, but I started with just one, like most people working at a W2 job in 1991.  Then bought more. I tried to buy one a year when I was young.  I always teach my employees to buy by 20 and have 10 by 30.   Then all they have to do is make enough to support their family.  Retirement, at that point, is not a concern.  

If you buy 10 houses by age 35, with rent increases, they should all be paid off by 55.  In 20 years, even entry-level houses will be worth 1M each if you are in a desirable location.  So you will be worth 10M.  How else can someone do that?   

I mainly agree with taking the hit as a new person.  I actually had a guy who invest in my fund and he told me his accountant told him he had to place the money right within 30 days to take advantage of Cost seg by the end of 2024.  I told him take gain and wait.  He insisted on listening to his accountant,  I was able to place his money for him in a small private deal but I don't think it was a wise decision.  He would have been better off putting it into an OZ fund.  

Jumping into a STR on short notice when most markets larger markets are not doing well is not a good idea. I think small college towns are great places for STR. You are not competing with as many people. We live in North Idaho and our airbnb have about 70 percent occupancy and we don't really work that hard at renting them in the town we live in. We also have several in resort towns and that is more work to deal with.

There is also a lot more to the test of being a real estate professional.  If you earn more at your current job you don't qualify.  

Do you have a good accountant? 

If it comes down to it and you have to place the money then let some of these people know and they can place it.  We do cost segs on our funds I a would assume other people do.  My current fund is full and I am not starting a new one for a while but i am sure there are people on here that can help you place your money.   A lot of fund are doing badly because they did not have the experience to be doing it but there are many smaller funds that use good fundamentals that are doing well.  

I have found it to be accurate sometimes and sometimes not accurate.  Where I have most mine it is way low.  

Good Morning Josh

Only fool rush in according to Elvis.  So don't do that.  In order to help you most people on this platform are going to need a lot more information.  

You stated you are a new LLC owner? What exactly do you mean? Are you self employed or going to be or did you just start an LLC to put future real estate in? Are you a w2 employee? How much do you make? Do you have 2 jobs? Will you get a second job?

Your first house generally should be owner occupied and hopefull you can offset income with roommates or an additional dwelling unit.  But if you are married with 7 daughters that is probably not going to work.   Can you give us more info about your situation so people that might be an expert in Cincinnati can guide you a bit.  

The best way to find deals it off market and there are a lot of ways to market.  If you have a young family it is great to do fliers with a picture.  Old people that have owner occupied a house and raised kids in it almost always want someone to move in with kids.  They will sell it to you for way less money just because they want a family.  

If you are single you a much more flexible and can live in a basement closet.  I did for several years on my seconf house back in the early 90's.  It was just big enough for a twin bed but I cash flowed $500 bucks which at that point was enough to buy food and gas for a month. 

You stated you will do anything and I think that is a good attitude to have but the question is what is anything to you?  Work 80 hours a week for 5 years?

Quote from @David Aylor:

Quote from @Matthew Becker:

Quote from @Arthur Schwartz:

Call the county or town zoning person.  See if the lot can be subdivided, so that each cabin sits on its own parcel.  If it can be subdivided, financing will become much easier....

 In many counties they allow multiple building especailly if they are small.   They might not even be considered dwelling units.   Did you pull a permit?  Is their a drain fried.  I would not subdivide unless you have to becuase there are cost involved with that.  You might be just fine but if you did not pull a permit then I would not talk to the county.  Just go with lender that is non conventional.  I am getting rates in the 7% to 7.5% now.  Which is just above owner occupied. 

Yes, we are fully permitted (building, septic, well, etc). I'd prefer not to subdivide bc the plan is to build another cabin in the coming years and then sell in 5-7 years.

There should be no problems.  Get in a room with a commercial banker rates are better in some cases then 30 year money.  Last loan I did was 6.25 when rates were 7.5.   Go to community banks and credit unions in the area the cabin is located.