All Forum Posts by: Syed H.

great points about the fees. People don't understand how much they add up. Trying to mitigate some of those fees have a HUGE ROI.

I personally close on most deals in cash and then refi out after I’ve turn the property. On singles I can do that in 3-6 months. Multis obviously take longer but the forced appreciation is also much higher.

To deal with the seasoning and the prostate exam refi’s require, I like building relationships with my bankers. My main bank gets my yearly tax docs anyway. I never have to give them anything new for any refi or purchase. They never hold reserves from me, never ask for any abnormal/burdensome docs, and do not require any seasoning. 

It’s funny Bc one of my mortgage brokers gets worse terms and a harder process from this same bank. 

100 single families are hard to manage. 100 SFHs have 100 roofs. & Most importantly, everything cash flows on a spreadsheet. Many don't in real life. Maintenance is a lot higher on 100 sfhs, usually mainly because it's just more square footage. 

Large SFH portfolios can be done, its just not as easy as people say it is and you need to buy them for CHEAP (which isn't easy to do in any decent market).

Honestly, it doesn’t matter.

I personally drive a 2019 Honda. Mainly because I don’t like my employees in my other businesses seeing anything super nice and I hate dealing with unreliable cars for my DD. I just want it to work. No time to deal with things breaking.

But I know plenty of landlords with a lot more experience, units, and money than me that drive nice cars to their buildings etc. Don’t pull up in a Ferrari, but any Luxury crossover/suv isn’t going to get looked at twice either. & even if they do, so what. That’s their problem. 

Congrats on the purchase. Remember when you buy in 18102, maintenance/capex is higher than usual. $1200 rent for a $85,000 sounds great, but honestly its not a crazy high return. I would imagine you will clear $150-$200/month, which is low for a SFH IMO. $85k, for experienced buyers, isn't really cheap in the area unless you are buying on a really good block. I would shoot to be in a SFH between $55k-$70k in 18102. Also, for just 1 SFH, you are close enough in NY to manage it yourself IMO. Just find a good handyman.

IDK much about Reading, but philly is a great market to invest in. 

No offense but when you come online and say something drastic, maybe post your experience and net worth. I don't necessarily disagree, I do think prices should/will come down, but if you don't have experience investing in a larger scale and/or have been through some cycles, it's hard to take your advice. Just like you are saying the world is ending, other people are saying we'll be fine. 

You also have to remember people need to do something with their money. Holding cash is a decision as well. If you believe that inflation will sky rocket, than holding cash isn't a good idea either. Also remember, even if you have cash, you still might not be able to buy in a horrendous market. Liquidity dries up and everyone is chasing the bottom. Everyone says they will buy during the down cycle, but it is easier said than done. If that was true, a lot more people would have bought between 2008-2010. But the truth is sales volume for investment grade product plummeted those years.

I personally have been buying, and will keep buying value add and entry level home flips. The true REI's I've met that have been doing this successfully for 20+ years, have bought in every cycle.

Same. My latest loan was @ 4.25% with a local bank for a SFH cash out

Also to be fair, I also own cash flow properties. I think a solid mix of both is always ideal. 

Depends how wealthy you are and how much money your need now vs later. 

Negative cash flow I wouldn’t do, but minimal cash flow + appreciation makes a lot of people extremely rich. Richer than most investors in cash flow markets. 

You see a large bias towards cash flow only markets in this forum because many people here are looking to replace their w2 income ASAP. Most investors here also don’t have the net worth or knowledge to invest in the difficult appreciation markets. Higher barriers of entry are a good thing for existing investors. Most investors in primary markets like Miami, NYC, SF; etc, have net worth way above $5m. 

So does being an individual investor and not a public traded company or god forbid a Private equity shop any more or less of a business? Many individual investors use that income as a means to retire, as a means to pay their bills; etc etc. 

& since you have 2 posts, and probably know nothing about the economics of housing, you ask why does rent have to go up 5-8%, when inflation has been sub 2%? Well there are many logical answers to that. 

1st: Taxes do not follow CPI. 

2nd: Utility companies do not follow CPI. 

3rd: Because that is what a property owner WANTS. It is his or her property. They can do with it what they want. They can leave it empty if they want to. 

4th: When market rents go down, Tenants ask for reductions or move to cheaper apartments. Why shouldn't landlord raise rents every year when rents are going up? 

It is a disservice to tenants to not raise rents. If you never raise rents, you do not have enough funds to maintain your properties. Want to know why slumlords have pretty cheap rents? Because they don't put a single penny into their properties. They do the bare minimum (sometimes even less than that). You can't afford to maintain your properties well if you don't raise rents. Don't buy into the socialistic cooled, there is not a huge margin in rentals. People get wealthy from RE because of long term investment, leverage, and tax benefits. Not because of price gouging. 

While I have achieved higher returns than most passive LP deals, I do agree with Andrey that most people would be better off investing with good sponsors or funds.  There's a reason GPs make what they make & why LP make what they make. It is much harder to be a successful GP than a successful LP. 

People don’t realize the time commitment of owning assets themselves. Owning assets is good for people who are in the business of RE already. A flipper who owns rentals, a syndicator who owns rentals or flips, a PM/Agent that owns flips/rentals; etc etc. If you are already in the business it makes perfect sense to own assets. I wouldn't own so much real estate if I didn't make RE my primary business. Part time RE sounds horrible.