All Forum Posts by: Scott Mac

I think you should work in the franchise like your father wants.

Learn the business, what if you worked as many hours as you can, work 80 hours a week or even work 100 hours a week (child labor laws might limit this ????)

In every state I know businesses must pay time and a half for all hours worked over 40 hours. 

As an inexperienced boy you would probably make minimum wage even though you work for your father - unless you are a manager but that takes experience and some maturity of years. 

You have an idea from a book that you can be a lazy boy and not have to work for your money, but it takes money to make money And you probably don't have enough money to make that money work for you. So you will probably have to work for yourself and save that money.

This is not a money for nothing business.

Work a lot, save it all, eat the food that your mother makes for you and go to work- then when you have a big pile of money of your own you can decide if you want to risk it On real estate.

Read Rich Dad Poor Dad.

Good Luck!

Hi Pan,

Work a second job, use that money for the down payment on your next purchase.

Before that purchase, it might be wise too consider having some operating capital for unexpected expenses set aside that is liquid cash well cash equivalents.

Good Luck!

You might want to think about building that into your cost of doing business when you are in areas with a more challenging population.

What I mean is, if you are thinking $50,000 down, plus closing cost, plus fix up cost, plus time on market to get rented as your foot in the door cost to get up and going- you might want to add an extra line item for additional time and additional costs associated with this type of scenario.

To cut it short, I mean theft and vandalism.

Good Luck!

 How much generational wealth will you build ? 

What will this generational wealth consist of?

It is my opinion that renters and (Landlord owned) ice makers do not mix- unless you want to pay for a lot of repairs.

Ice makers breakdown a lot.

I would never have an ice maker in a rental.

I have an ice maker myself- I love it I use it all the time- sometimes it breaks down and has to be repaired- I don't care I want the ice and am willing to pay for it.

Just my 2 cents.

Quote from @Henry Clark:

@Scott Mac

In 3 recommending he builds.  5 years ago I would say to buy your first one.  Now the premiums are so high it is better to build.  Plus Market analysis is the only thing you can fail at that you can’t correct.  The good thing about this is he will have to go thru a lender.  They won’t lend to him unless he has his act together.  Rah  Rah won’t get him a loan.

Using a 10x20 unit as an example on why to buy.

C market $65 per month. B market $90. Market $130 and higher for a drive up non climate. If you do a 200 unit minimum A location it will be worth at least $1mm more than cost on day one with no occupants. If he was to buy this location he would have to pay the extra $1mm making his return okay. If he built he would get a 400% COC return day one.

More risky to build ground up.  But again Market analysis is the only thing he can’t fix.  

Start small and Make Your Big Mistakes Early.   

(1) So you are telling him to build 200 units in a Class A location with this or is it class B or C???

Depends on your market. $50,000 SBA 10% is $500,000. Get up and running to 80% occupancy. Depends on your market. Sell for $700,000. Now you have around $200,000 in hand .

(2) Are you also telling him to build another 200 units in a Class A location but this time on more expensive land to get up to the 2 million???

Do another one at $200,000 SBA 10% $2,000,000 deal. Get to 70% and sell you will be around $1mm cash in hand including your downpayment.

Do again. Hold this time.

Quote from @Henry Clark:

Post one of your deal analysis. Let's see what type of numbers you're looking at. What REI model.

What do you mean by $1mm per year?  Cash after taxes?  Revenue before expenses and taxes?  Appreciation plus cash flow?  There is probably next to no one making consistently $1mm after taxes per year on this forum.    

If your wanting to get to $1mm after tax per year:

1.  Doesn’t fit your time frame but join the military.  Do BAH investing. You will definitely get to $1mm equity by 45.  With what you have learned should be able to get to $10mm equity by 55.  You don’t want to be able to earn or spend $1mm per year.  If you cover $100,000 per year in todays dollars your good. 

2.  Another avenue to go is Property tax sales in Texas.  Off list properties not at the tax auctions.  Use this get get more cash in hand.  Not as a Longterm business model.

3.  Self storage.  Depends on your market.  $50,000 SBA 10% is $500,000.  Get up and running to 80% occupancy. Depends on your market.  Sell for $700,000.  Now you have around $200,000 in hand .   Do another one at $200,000 SBA 10% $2,000,000 deal.  Get to 70% and sell you will be around $1mm cash in hand including your downpayment.  Do again.  Hold this time. Depending on your market you will be doing about $200,000 per month “revenue” not cash.  But you will be building both cash and equity. Pay off in 12 years.  Then your around $140,000 cash per month.  You don’t need more than that.  If you do.  Sale and now do three deals at once.  

None of the above will happen if you don’t take the first step and post a deal analysis this week.  

 Hi Henry,

In number three are you advising him to build new storage units or to buy an existing storage unit facility ?

Hey Joe,

Flat roof leak detection can be hard because the leak may be some distance away from where the water intrusion shows up inside the home.

A wall that is on the face of the building higher than the roof and the roof comes up and rolls up the wall aways And is sealed there. 

The front wall may be the source of your leak, With the water running back underneath the roof inside the rafters And making spots on the ceiling further away from the wall.

You want to be told how to buy 167 doors (for keeps) in 5 years, starting with 50k?

This business does not work that way.

That is old infomercial sales hype to sell get rich quick kits to the unsuspecting public.

Good Luck!

Supply and demand.

If there is a shortage of housing you can charge more rent.

Your turns will be shorter.

If they build more housing your renters are going to go and live there. 

If you own a 7 Eleven- Do you want an 812 on the opposing corner, and a 913 right next door to you, and a 1014 down the block all within walking distance of each other?

Instead of trying to solve something which may not actually exist.

It might be more wise to think more on entrepreneurially, and wait to see what happens- and look for ways to exploit that solution in ways that can make you money.

Because it seems like whenever they pass things there are always loopholes left in there, some of which are attractive to a lot of people, and some of which are only attractive to some people.

Solving this problem is not going to put a new Mercedes Benz in your garage, But if you are clever enough thinking entrepreneurially might just do that.

Just my 2 cents.

https://www.youtube.com/watch?v=CqHweCW_sYg