All Forum Posts by: Ray Lin

Search for a really good property manager in your target area. You could find the best deal, but the property manager will be the one sending you money. Rental properties and monthly cashflow is nice, but it's a long term game. If you're new, start with one property and learn all the ins and outs. Vacancies, repairs, taxes, management fees and miscellaneous costs will eat into your profits. I've lost money in begining, but I'm not giving up. Find a great property manager and you'll make money.

I don't think there is one best strategy. My partners and I have a nice portfolio of SFH in the Biloxi area. As Pat has stated, avoid the flooring areas as much as possible. Every year, there's hurricane season and water is problem. I have looked into multi family, but have not been successful. The MFH will have better cash flows but more tenant turnover. My SFH, one tenant has been with us for 10+ years. We personally like SFH, tenants will be families, children and dogs, yards with fences, will have a lower turnover. MFH, tenants come and go, get married and move into SFH. Since, you're military, SFH have less moving parts and less hands on approach.

Zillow, craigslist and Facebook. These are the main 3 that I have used with success. Zillow charges a nominal fee, but it's the cost of advertising. You need to post your rental everywhere to get as much exposure as possible. From my experience, Zillow has the best prospects. You will need to screen each tenant properly. Some rentals get rented within 3 days and some sits in the market for 3 months. Location, location, location. Good luck.

@Stephen Johnston, Do you have any recommendations for contractors or handyman? I have a rental in OS and needs repair work from time to time. Painting, flooring, general plumbing, electrician, and HVAC.

I have purchased tax liens in KS, MS and NJ and performed extensive research in FL. In my opinion, tax lien and tax deed properties are not worth owning. The properties will be probably be valued around $50k or less. Most of my liens were redeemed and I got paid 18% interest, but I still end up losing in total because the liens that was not redeemed turns out to be worthless homes, probably valued around $10-$20K or less. Those properties needed a lot of work to bring to rentable conditions. Just too much work and too much money involved. Tax liens and deeds may work for you, just not for me.

It's great that you are looking into real estate at such a young age. I wished I did that. Anyway, my recommendation is to start saving and eventually become a homeowner so you don't have to be a tenant. Once you're a homeowner, you can rent out the rooms or parts of the house and have your tenants help pay your mortgage. How much to save? Maybe about 10-20% (about $50,000) for a down payment, depending on how much is the purchase price. I've been looking for something in NYC for the past 10 years and haven't really found something I like. But I'm still looking. Try to buy your first home, then look into rentals.

From my experience, multifamily with multiple units tends to be more profitable but more work. The tenants are transient and doesn't stay long. The tend to move out more often and the turnover is much higher. The smaller duplexes will have multi-year tenants and turn over is slower. Personally, I like smaller units and less tenant turnover.

I don't have a nasty eviction attorney, but my property manager is pretty good. I had a tenant who didn't pay. By the 2nd week, an eviction was filed and a court date was set. Two weeks later, the tenant left and wanted to avoid going to court. If possible, you may want to file your own eviction. My property manager is not a lawyer, but she's filed evictions and has attended court sessions on her own. She's won 9/10 cases. It may be different in your state or county. Some states are very easy to file evictions.

The best time to buy is now. I purchased my primary residence during the housing crash in 2008. I paid at the highest point and felt like an idiot. I was in a rush to buy. The price was $500K. Today, my neighbor sold his house for $775. Your market maybe similar to my market, it will only go up.

About risk mitigation.. My market is landlord friendly and the eviction process is pretty straight forward. After 30 days without rent, my property manager files an eviction notice. The tenants loses almost all the time. Also, my manager files for wage garnishment for back rent as well. We could be without rent for about 60 days. Since our rental properties are free and clear, expenses is kept to a minimum. One of our property was vacant for 6 months and my investors still sleep soundly at night.