All Forum Posts by: Paul Wurster

@Joseph Heath

You might want to make sure that the houses where you are buying would survive without the military there. I don't think Lackland or Randolph are going away, but HUGE cuts are coming. This is a problem that I'm contemplating just North of Sacramento outside of Beale AFB. I have a great house with a long term tenant who has been perfection since day one. However, I think the base is going to downsize in personnel. It won't ever go away, but the amount of people stationed there might drop.

I think it is a blend. I do expect inflation so I would buy leveraged properties that still cash-flow. That cash flow is your buffer. I wouldn't buy negative cash flowing properties expecting appreciation and inflation to get you out of it. Nothing novel here. Your strategy needs to be resilient to both circumstances.

It depends how you think it is going down. If you think the dollar is going to collapse, get in as much debt as possible and let it inflate away. If you think jobs are going away, batten down the hatches because your renters will miss a few payments.

What kind of work are you doing on it?

I've been in for 14 years and have had a few military renters. I would say there is nothing special about us nor should there be. Treat a military person like you would any other tenant.

Many military members want to rent to other military members, but I think this is just a familiarity issue. It used to be that people were trained to the standard of living in base housing where you had to do a full make ready just to get checked out including a seriously overpriced cleaning person. With privatization, this is not the case anymore. Newer troops don't have that same experience. Hold them accountable and stick to your process.

I don't even hear about commanders leaning on their people anymore over these issues.

I do like renting to contractors. They don't seem to move as much. I've got one in @David Hutson area that is finishing their third year of pain free renting, and they want to stay. I like that.

We called several banks and found some that would do hard money loans here in Montgomery. We never utilized them, but they exist.

I used to teach Dave Ramsey classes. I feel the pressure to be debt free, but it is difficult with REI.

My family does not use debt for anything else but investing. We just came to the conclusion that we cannot grow quickly without it. I am in the military so I have a limited time to exploit the great market here in Alabama. Without debt, we could have bought one or two properties. With it, we have purchased eight in less than two years. We cash-flow on all of the properties, but I am wary of the debt load and having an escape plan to get out it if necessary.

I can see using debt to get to the size you want, and then paying them off to increase/maximize your cash-flow. I'll let others talk about the dead equity and lawsuit magnet issues.

I agree with Brianna. If you worry about what other people are making, you die bitter and poor. If it is good for you, go for it.