All Forum Posts by: Joe Villeneuve

 So your contention that low cap rate markets shouldnt be invested in? Only high cap rate markets?

It isn't just replacing windows and doors its how they are installed. A lazy installed may not spray foam around the door or window or into any voids accessible adjacent to the window when installing. Also with a door, simply replacing or adding a door sweep at the bottom can limit air infiltration.

If you are only paying a portion of the heating costs, keep in mind how much longer it will take for any updates to pay you back as opposed to a situation where you paid the entirety of those costs. 

I care about total return and have barely a concern about the source of the return but try to minimize the return from cash flow due to the tax consequences.  Equity extracted is taxed deferred until sale and can be extended further via a 1031.  At death, the property gets a new base value and all gain is gone from a tax perspective.  Seems crazy, but that is the current rules.

To answer @Joe Villeneuve question “How long will it take before the accumulated appreciation, outgain the accumulated negative CF?” is day 1.  My worst appreciating property has appreciated ~$2700/month over its hold.  My best has appreciated ~$10k/month over its hold. Neither of them ever had projected negative cash flow close to these amounts using conservative expense numbers.

Some act like cash flow is guaranteed, but at the Great Recession there was many markets that had large decreases to revenue (lower rent and/or higher vacancy rates).  cash flow can decrease.

I recommend everyone start in their local market whether that is a cash flow market or appreciation market.  You can succeed in both markets if you make smart decisions and perform the work necessary.

Good luck

Negative cash flow of about 200 is okay per month. My property is in prime location and will appreciate

I invest mainly on appreciation. Also as the tenant helps pay the mortgage down after a few years you can use heloc etc and buy more properties to scale or sell it off

Does anyone have or know of a location to find a spreadsheet with the metrics I should use in evaluations U.S. locations to invest in?  Or what metrics should I put on my spreadsheet to help evaluate whether or not a city or state is a good location to invest in?  Thank you.

 Sorry I was not clear, the ITEMS /FOOD left in the fridge.

If only the people asking these would SEARCH the forums first to either:
A) Find this post and know to not ask
B) Find any of the multitudes of posts that attempt to give an answer to those questions.

And I love any of the ones around LLCs, bank accounts, what should I name my LLC, should I register in WY, etc...

Lastly, while I get the point of #4, I have to say, if these were a real question, I would be less apt to ignore it, since presumably some amount of work as gone into understanding real estate enough to put together a business plan AND there is something tangible to provide commentary on.