All Forum Posts by: Omar Khan

@Ahmad Kakar You might benefit for a few years because you are in a strong market but will eventually have a lot of frustration when it comes time to do major maintenance. 

E.g. roof replacement is a major pain when 2 people need to agree. It would be hard to just replace your side of the roof. 

If you're only looking to buy for a short period of time (less than 5-7 years) and the duplex doesn't have major capex issues, you might be fine buying it and riding the appreciation wave. 

@Rachel M. I would nominate the great state of Texas (my home state) followed by FL. Great economy, wonderful schools (not at the same level as the U of California but a solid second), killer food-scene and chill people. The warm weather doesn't hurt also ;)

That's not a bad deal on your hangar! 

I gotta start making more money/win the lottery and then convince you to become my guru. Your wealth of knowledge + common-sense (the hardest thing to acquire!) would propel me to the stratosphere. Plus, I'm sure a ride on your Cirrus wouldn't hurt also ;)

@Bentley Cox That depends on your income, goals, objectives, budget and constraints. 

E.g. If you're a physician making a high income you can afford not paying (in totality) your mortgage, car loan and personal loan and plowing head-first into a started investment property. This is because you have the economic luxury of making a mistake and learning on the job. It doesn't work the other way 'round. 

If you feel your debt burden is high or you would like to get a handle on your finances, I would recommend starting with Dave Ramsey's books. It's tough love but tough love is the best kind of love. Plus, Dave is an old-school curmudgeon (which I love!). 

@Elizabeth Roncevic Without a solid grasp of investing principles (none of which involve anything above basic arithmetic) you are going on a hope and prayer. It might work but eventually our bad habits catch up. 

Again, I'd like to stress that NONE of the math is complex. In fact, you would've learnt the basics by Grade 5/6. Everything on top is just a fancier way of expressing the same basic principles. 

Also, practically nobody in the world has mastered the fundamentals because every time we think we have it nailed down a new situation/crisis happens which shapes our thinking in a new way. So just get comfortable enough to understand what's going on... but you don't need to do a PhD (or even undergrad) in finance. 

As @Mike Dymski has also pointed out once you're comfortable with the basics you will realize that deal sourcing will be you biggest challenge. That requires non-mathematical skills - relationship building, persistence, diligence, organizational abilities - that will help you go ahead of the math nerds ;)

P.S. Easiest way to learn: Try teaching it to someone. You'll quickly realize the holes in your logic. 

Most folks on BP aren't buying investment-grade MH parks. These are low-end rat traps with rents between $200-350 rents. Folks serious discount the operational/asset management side of owning these assets. It always surprises me that the same folks would avoid buying Class D MF properties but somehow cater to the same demographic when it comes to MH parks. 

I get that the rents are different and that the MH park is MH in name only as it costs a lot to move your home. But the demographic challenges remain the same. The solid operators have asset management experience which doesn't get as much attention from the average investor because it is not a sexy part of the business. 

Are hangar rents similar to industrial properties (but with even less headaches and more expensive assets parked in them)?

Nothing is recession-proof nor recession-resistant. 

I know manufactured housing and self-storage are the hot places to invest these days but they, too, are suffering from the same issues - massive spike in prices (over the past few years) and everyone stampeding to get into these assets. 

If you look across the major syndicators, you will note that their return projections are going down to account for the increase in valuation increases. 

Now you might have an edge in manufactured housing/self-storage facilities because you can source deals better than the average person but contagion risk always exists. 

@Jay Hinrichs can chime in and tell you all about sure-fire recession-proof investments that purported to offer positive returns in the worst of times and then acted like any other real estate investment.

@Encsi Balla I second @Paul Allen advice. Before looking for an advisor you must understand what you are looking for in an advisor. The quality of the answers you get is based on the quality of questions you ask. 

I would suggest leveraging resources like BP and Google in developing your investment criteria, goals, objectives and constraints. 

Local networking with experienced investors will also accelerate your progress as you can learn by avoiding their mistakes.

Any lender will be looking at your ability to service the loan (i.e. payback the mortgage amount every month). You should be good as long as your income qualified for the mortgage. 

Obviously, it is not as simple as I've described but wanted to give you a high-level overview. 

Best bet: Network on local REIA meetups (warning: these are full of "gurus" with sales pitches... avoid them!) and on BP before diving in a deal. Experience, local investors should be able to connect you with investor-friendly resources in your preferred market.

@Dominique Mickles You should also look into 3% down conventional loans as well. Often, they are at equal or better terms than FHA loans.

You should be able to qualify if you have a good credit score, reasonable DTI and have a decent job.