tag:blogger.com,1999:blog-2980246226076317453.post8855922755036741155..comments2024-03-18T15:29:55.472-07:00Comments on Done by Forty: House LustDone By Fortyhttp://www.blogger.com/profile/06246597867355460723noreply@blogger.comBlogger43125tag:blogger.com,1999:blog-2980246226076317453.post-65781771719437904942014-12-08T07:24:13.645-07:002014-12-08T07:24:13.645-07:00We just bought rental property nr 3, after buying ...We just bought rental property nr 3, after buying nr 2 earlier this year, it seems like a great way to get some profit. We do buy locally though...the new house is at a small city only half an hour drive away. Its the first one we took a loan for. its still very cash positive though! In fact, loans are very cheap here in Europe for he moment, so its sometimes better to have a loan and keep,enough cash for if a next property comes your way. We always buy the cheapest property in a city center, that way, we are sure we can turn it for a profit, while there are plenty of people who want to be tenants.<br />nina<br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-89112773693098821202014-11-19T08:25:13.018-07:002014-11-19T08:25:13.018-07:00Thanks for that perspective, Tony. We rent out a r...Thanks for that perspective, Tony. We rent out a room in our house and think it's a fantastic way to make money: it's the easiest $500 we earn each month.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-60618546164168581712014-11-19T03:56:53.325-07:002014-11-19T03:56:53.325-07:00I had a somewhat similar problem, no mortgage, cas...I had a somewhat similar problem, no mortgage, cash piling up, and less than 1% interest in an ISA. I never thought too much cash would be a problem ;) My solution was to upsize my home (that was a very difficult decision). I bought a fixer-upper with great potential in a nice location. No rental income of course (although I am going to be renting out a room to a friend), but it is tax efficient (no capital gains if I sell), and I sleep at night. I was tempted by a low cost index fund, but you can't live in one. My brother does rent out properties - his niche is expert local knowledge, and investment in purchasing properties only in highly sought after locations. The quality of tenants he's got is astonishing. Good luck with your plans, but I would definitely advise staying local with rental properties.Tonynoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-23465811839291648852014-11-14T15:31:03.895-07:002014-11-14T15:31:03.895-07:00I'm so sorry that blogger ate your comment, Em...I'm so sorry that blogger ate your comment, Emily. I wish I were savvy enough, tech-wise, to figure out what causes that. And thank you for writing another comment, too.<br /><br />One: I am very sorry you're having to go to trial with a tenant. That is a very sobering word of caution.<br /><br />Also, we have thought about going the all-cash route. The problem is that, without leverage, I don't see returns that would justify actually investing in real estate. The cash-on-cash returns get into the low single digits: at that point, I'd rather just buy a boring old index fund. But, I might be looking at a very different market or type of investment property than your friend.<br /><br />It's definitely giving me pause for thought. We could probably buy just one, all cash, right now, and it'd take a good long while to save up for the second. But after a while, the pace would accelerate as it did for your friend.<br /><br />A safer (probably wiser) plan...serious food for thought. Thanks, Emily.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-64313664158815117612014-11-08T11:55:54.385-07:002014-11-08T11:55:54.385-07:00A kitten dies every time a comment doesn't pos...A kitten dies every time a comment doesn't post :(<br /><br />(Now a much shorter version) <br /><br />1. If it were me (and it never would be since our lawsuit with our most recent tenants is about to go trial), I would rather be an expert on one or two areas rather than try to research and keep tabs on multiple. <br /><br />2. Certainly there have been many, many claims of folks getting quite wealthy by leveraging debt to invest in real estate. I have always witnessed the opposite - a domino effect debt fall-out with high stress and low margins. Of the investors I've personally known, only one has been calm and thrilled with their real estate (about 14 single family homes all in Salt Lake) - the one that paid for every unit with cash. <br /><br />Their process was to set aside the rental income until they could buy the next one, which has snowballed into a new rental home investment about every 4 months at this point and no stress when they need to close up a home for a few months to renovate or can't find a good tenant for awhile. Plus, they are able to undercut all other local rentals, so they get the BEST tenants fighting over their units.<br /><br />Regardless, best of luck!Em Capito, LCSWhttps://www.blogger.com/profile/07690949620210399390noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-90083403992313903592014-11-06T08:20:07.622-07:002014-11-06T08:20:07.622-07:00Thanks for the welcome back, Femme Frugality! I...Thanks for the welcome back, Femme Frugality! I've missed ya too. :)Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-18798954021500977012014-11-06T08:19:36.811-07:002014-11-06T08:19:36.811-07:00That info was on their proforma, as I recall. Give...That info was on their proforma, as I recall. Give it a look.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-83022007452161637372014-11-06T08:18:56.698-07:002014-11-06T08:18:56.698-07:00Hi Laura! Mrs. DB40 is generally wary of investing...Hi Laura! Mrs. DB40 is generally wary of investing, but real estate is the sweet spot between our viewpoints. I hear what you're saying about the advantages of being local, too.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-6403506446006995732014-11-06T08:17:17.565-07:002014-11-06T08:17:17.565-07:00Thanks, Jason! I'm glad to have you here as a ...Thanks, Jason! I'm glad to have you here as a reader. We were ardent followers of Dave Ramsey for years. But we've come to get comfortable with some debt (e.g. - paying off credit cards in full every month, and using mortgages for rentals).Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-11009350678119219692014-11-06T01:38:34.963-07:002014-11-06T01:38:34.963-07:00You have been busy! I like the point you made abou...You have been busy! I like the point you made about your wife being comfortable with this area of investment - it's so important to be on the same page. <br />I don't have any experience in this area at all I would always try to stay local purely because of the local knowledge aspect.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-23283470655758647652014-11-05T15:36:41.196-07:002014-11-05T15:36:41.196-07:00Glad to see you posting again. I learn tons from y...Glad to see you posting again. I learn tons from your post. I wish I could offer insight, but we just bought our first home and are above the age of 40. However, people like Dave Ramsey are always going off about not being a long-distance landlord. I am not sure he is correct, but if you are looking for multi units there are tons in the Northeast that seem to be profitable. It is really common to see two family and three families, particularly in Boston and Providence where you have tons of students and could provide good income. Just my two cents, but just glad to see you back.jasonedwards57https://www.blogger.com/profile/13725522432598704753noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-3443868358779929622014-11-05T08:45:27.748-07:002014-11-05T08:45:27.748-07:00Thanks! Good to know that. I definitely would hav...Thanks! Good to know that. I definitely would have a problem with the property not appraising...it suggests that the price is too high. I'll have to raise that issue if I ever consider investing through that company. Andrew@LivingRichCheaplyhttp://www.livingrichcheaply.comnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-17914399815804498902014-11-04T22:53:22.461-07:002014-11-04T22:53:22.461-07:00Thanks, Myles Money. I've been mum on the whol...Thanks, Myles Money. I've been mum on the whole thing just due to, I don't know, some shyness about our investments. But I'm trying to be open.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-27458270622353777332014-11-04T22:52:39.690-07:002014-11-04T22:52:39.690-07:00Hi Mrs. Pop! I remember arebelspy from the MMM for...Hi Mrs. Pop! I remember arebelspy from the MMM forums...really need to stop by over there again some time. He was a motivating factor for us getting in to real estate.<br /><br />I hear you on the ease and diversification of a REIT. It's certainly simpler. But I also like the advantages of leverage, too -- it's a mixed bag.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-77239830166511605302014-11-04T22:51:09.607-07:002014-11-04T22:51:09.607-07:00Thanks, Clarisse! Overall, it's been a positiv...Thanks, Clarisse! Overall, it's been a positive experience for us so far.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-85476862206820213832014-11-04T22:50:26.803-07:002014-11-04T22:50:26.803-07:00Hi Anna! I hear what you're saying about the t...Hi Anna! I hear what you're saying about the tangible aspect of real estate. There is a part of me that wants to touch the bricks. Some day, I'm going to fly out to these houses we own, but have never seen, and touch the outside walls.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-71496248239031442632014-11-04T22:49:37.624-07:002014-11-04T22:49:37.624-07:00Thanks so much for that sweet comment, Three is Pl...Thanks so much for that sweet comment, Three is Plenty. REITs have some real appeal for us, though I do wish there was a way to get the benefits of depreciation and some tax deductions through them. There are certainly days when I think just owning a primary residence (or maybe even renting) is the right way to go. :)Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-55122288306335552092014-11-04T19:03:15.158-07:002014-11-04T19:03:15.158-07:00I'm with Tonya! Saving up for our own home, b...I'm with Tonya! Saving up for our own home, but any rental properties are going to come after that...and that's a maybe. So I've got 0 input for you on this one. I've missed you! Glad to see you back!Femme Frugalityhttps://www.blogger.com/profile/07258982361804942329noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-62259990549163223362014-11-04T18:02:32.222-07:002014-11-04T18:02:32.222-07:00Property investment is one of my goals. It will be...Property investment is one of my goals. It will be interesting to read your progress. I understand the desire to spread the properties out to avoid risk, but as you and some of the other commenters have pointed out, that also increases your workload tremendously. Good luck!Myles Moneyhttp://www.mylesmoney.comnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-22389304011054233642014-11-04T17:14:57.436-07:002014-11-04T17:14:57.436-07:00You guys have been busy! Our comfort level with r...You guys have been busy! Our comfort level with real estate has never extended beyond areas that we know well and feel like we have an advantage of having a network or being "on the ground". I guess I view geographic diversification from a real estate perspective better performed through a REIT - as long as you're already paying middle-men for all sorts of other things you may as well get some ease and liquidity out of it. For that reason I'd really stick to one area for real estate investments, and preferably one we either have lived in, or planned to in the future. <br />But I know that arebelspy on the MMM forums has lots of rental properties in several areas, so it's working for him!Mrs PoP @ Planting Our Pennieshttps://www.blogger.com/profile/03092406694266872975noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-33673929334571480182014-11-04T17:11:51.890-07:002014-11-04T17:11:51.890-07:00Wow, you really have a lot investments! Me and my ...Wow, you really have a lot investments! Me and my husband have planned to buy a rental property in the future.Clarisse @ Make Money Your Wayhttp://makemoneyyourway.com/noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-42969983801124131482014-11-04T14:40:21.246-07:002014-11-04T14:40:21.246-07:00Congrats on your real estate investments, Mr. (and...Congrats on your real estate investments, Mr. (and Mrs.!) DbF!! I'm glad the two have been cash-positive for both of you, very exciting! I don't know a lot about real estate investing, but I would be more conservative and sticking with areas around me (at least drive-able areas) so I could physically see if it I had to. A family member did this prior to her raising a family, and has it pretty dialed where she can look at a couple of properties once a month or so while the kids are now at school. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-88836637734615257092014-11-04T14:25:58.990-07:002014-11-04T14:25:58.990-07:00Welcome back! I'm happy to be reading your po...Welcome back! I'm happy to be reading your posts again. I can't really help you on real estate though since my only attempt at it was a complete failure. I'm now scarred for life, and my only RE exposure is in REITs and our (future) home.Mom @ Three is Plentyhttp://3isplenty.comnoreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-44739097780853054902014-11-04T12:19:36.861-07:002014-11-04T12:19:36.861-07:00I think I know which company you're referring ...I think I know which company you're referring to. I've heard good things about them as well, but the numbers in Memphis and Texas don't seem appealing to me. The dealbreaker was when they told me about half their properties in Memphis don't appraise at value, leading to having to put down 30 to 40% of the purchase price. I couldn't move forward at that point...only because I don't want to ever buy a house for more than what an appraiser values it at. But I could also see how someone else could get comfortable with it, if cashflow was the #1 goal.<br /><br />Thanks for the kind words, Andrew, too. It's nice to 'be back'. Let me know anytime you want to email or chat about this stuff.Done By Fortyhttps://www.blogger.com/profile/06246597867355460723noreply@blogger.comtag:blogger.com,1999:blog-2980246226076317453.post-37980490120406966472014-11-04T10:48:08.222-07:002014-11-04T10:48:08.222-07:00Glad to see you back...I'm always looking forw...Glad to see you back...I'm always looking forward to your posts. This is definitely a very timely topic for me as rental property has been on my mind and I've been reading about turnkey investing on biggerpockets. Being in NYC, real estate is expensive and would not cash flow. I've considered other locations, but have been struggling with analysis paralysis. I feel like there's more risk when you're buying out-of-state. I thought about upstate NY since my brother in law lives there, but the prop mgrs I've contacted don't seem to be too good about responding to my questions. I found a reputable turnkey company (from what I've heard I guess) and they operate in Memphis and Texas (Dallas/Houston) so I was considering that. Hope to hear more about this topic.Andrew@LivingRichCheaplyhttp://www.livingrichcheaply.comnoreply@blogger.com