All Forum Posts by: Rich Weese

99% of the respondents will select 1031 exchange. If you know me very well, you know I march to the beat of a different drummer. I also like to play the contrarian.

If I decided to part with one of my 150 unit apartment buildings, the logical decision is to complete a 1031 exchange. I actually purchased two buildings using a 1031 exchange from a storage facility in Florida I sold. I understand how they work. Here is my question:

Do I really want to sell a large ridiculously priced property using a 1031 exchange for a larger ridiculously property? I need to determine what other options are before I make that decision.

1. I could put it in the bank and make nothing.

2. I could purchase bonds like many of the financial geniuses are recommending.

3. I could try and I'll approach that I have been using on SFR S.

I've owned quite a few single-family residences free and clear. Over the past three years I have been selling them. I furnish owner financing. It is amazing how many people have money but no credit. The homes I've been selling have been in Rio Grande Valley, Texas. It is a very high percentage of Hispanic residents. I have been selling those homes at 9% – 9.5% interest, amortized over 30 years with a 10 year balloon. The buyers had adequate down payment and great income or owned their own job or.....  I had owned those homes for a while and the appreciation has not been very good in that area of Texas.

It is passive income with a collection company handling the collection and disbursement of payment ,whose services are paid by the buyer. The loans are PITI and tenant pays insurance and lists me as insured.

Back to the apartment building. I would end up with a big stack of cash that I could sit on and wait for the next correction or crash in real estate. I could also offer financing on properties I did not own. I'm confident there are buyers out there that do not have the credit for an institutional loan and are able to pay 9% – 9.5% interest.

I would not do this on expensive homes. I would assume the median priced home in Rio Grande Valley is under $150,000. I have one in escrow right now that sold for $123,000 at 9% interest.

I guess the question comes down to what are my thoughts about correction or recession. My age also figures in where I am already collecting Social Security and have adequate reserves to live on. I would just like to make a good play and the right decision.

Has anyone else thought of this as an option? I realize the property must be free and clear to carry your own financing unless you are willing to try a wrap.

Thoughts?

 I know we have a lot of Dallas investors and agents on bigger pockets. I would like to get year input as to capitalization rates. If someone has a class C apartment building, turnkey operation, with new roofs etc., What cap Rates have you seen on properties sold? this is not a fixer-upper but does have value add with improving the interiors.

I realize this is a really wide range but I needed a general idea. 150 units or more.

Thanks.

PS. I really haven't figured out how to determine which forum different things go in. I even looked all through him but couldn't find something that seem to fit this topic.

I noticed where you live in Fort Myers. I don't believe you've gone through a large correction or crash in your real estate investing. I actually lived in Fort Myers from 2009 – 2011. I had purchased a storage facility in Bonita Springs and moved there to get the property turned around. If you had seen what that area look like in both commercial and residential, you would not be so sure about no problems occurring. There were new commercial strips completely empty. There was one area out side of Fort Myers that literally had hundreds of vacant, new homes. They were listed at less than 50% of their original value and still no takers.

Be careful and don't assume you know all the things that could affect buyers. There was also an additional problem of Chinese drywall.  That was a massive problem for that entire area.

I think your choice not to purchase anything at the present time makes good sense and I am doing the same.

Thank you. That helps a lot. One more question:

May I re-list the same post every 5 days? Above, it says 5 days must pass but I didn't know if there was a limit on how many times or not.

@Nathan Gesner

I wanted to thank you for the reply. I am more interested in the rules pertaining to being a PRO member. I wanted to know what the limit is for threads entered per day, how often you may place the same ad in the marketplace and how many times per month you are allowed to place the same ad. I remember seeing those things when I signed up but now I am unable to get back to that same page. Please help me out.

I agree there are lots of factors that enter into the economic changes relative to real estate. I am concerned about what part of that pie is affected by our decisions to get on the train, or get off the train. My attitude has always been to get off the train when everyone is getting on, and vice versa

@Account Closed

thank you for your reply to my thread. You list a lot of reasons for your belief. Do you have the same feeling about multi-units in Dallas as you do in Chicago? I have never had an interest in purchasing real estate in Chicago but I own nearly 500 units in Dallas.

Where are they found?

thanks.

After 40 years in real estate, I'm finally a PRO!!! I only purchased a one-month membership because of my age. I don't buy green bananas anymore either.

I get a weekly report from Amazon.com as to how many books I have sold on Kindle. I realized there are a lot of bigger pockets members that have purchased that version since I became active again. I'm not sure bigger pockets members are aware they can purchase the physical copy of the book with an inscription from me through my website: fromjanitortomultimillionaire.com. the price is $9.95 in the Kindle version and if you purchase from the website, I charge a little bit more for postage and handling. $14.95. I have The price the same since the first edition came out in 2002. The proceeds go to Alzheimer's research.

You will be able to preview the book and check reviews on the website. There are also reviews sprinkled in on bigger pockets. 

A current thread is: richweesefromjanitortomultimillionaire review. Please feel free to check it out and contact me through my bigger pockets PM.