All Forum Posts by: Wilson Churchill

 It's not so bad. I wouldn't mind having $500,000 worth of $20,000 homes. Sure, you have 25 roofs, but also 25 units paying an average of $700 per month (depending on the city). With a payback period of only a few years, who cares if the roofs need to be changed? A properly installed roof can last for a couple decades or more.

Do you currently have a HELOC by chance? If so, you could begin paying it down and redraw the money later. Of course you could put the money into IRA or ROTH accounts, so long as you are certain that your broker won't lose the money..

Cash flow certainly can build wealth, especially if one is earning 30%+ COC returns. But there isn't any reason that one can't get both cash flow and appreciation. Even in a market that is not appreciating or appreciating slowly, properties can sometimes be purchased at a steep discount, creating an equity position of 25% or more after some repairs. "There is more than one way to skin a cat."

Wow! I wish I were in a position to move on this. Where are the properties located?

I haven't had any complaints so far. People question it at first, but when I explain the benefits (easy to clean, keeps the home cool, looks nice), they accept them. Also, I keep my rentals clean and beat out the competition in most cases.

I like to use ceramic tile through a whole house. I use FRP or tile for the tub surround and kitchen back splash.

Even if city hall says you can't have a rooming house, you can still have roommates. 

You can get your landlord statute (if any) from city hall. You are always allowed to have roommates. As long as you are technically living in the property, there is no violation of the FHA agreement.

You can depreciate the portion of the property that is rented. The utilities, taxes, insurance, repairs, etc. attributable to the rental portion can be deducted against the rental income. See Publication 527 for more information: 

http://www.irs.gov/pub/irs-pdf/p527.pdf

In order for gold to be a good "investment", one has to rely on good timing. Is not the time to buy gold? Sure, if you really believe that prices will triple within five years. Then again, who is to say that you can't obtain the same return or better with real estate? You can double your money in short order by fixing a "distressed" property and reselling it. Or renting out an inexpensive home can offer a short payback period. But the bottom line, in my opinion, is that commodities and securities cannot compete with real estate for one simple reason: leverage. And real estate performs better with inflation, especially if leverage is utilized. Prices and rents increase over time, but the principal of mortgages does not increase with inflation.