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Old 05-07-2014, 01:29 PM   #1 (permalink)
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Real Estate Investing Thread

Long story short, I've been interested ever since high school but just never got around into doing it.

Anyone here purchase homes to either revamp or rent? I'm leaning on the purchase to rent side of things.

I'm ready to jump into it, but looking to do some research first and why reinvent the wheel if I can ask around and find out about the major pitfalls to avoid.

So who else is interested in trying and who here has jumped into this?
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Old 05-07-2014, 03:41 PM   #2 (permalink)
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Old 05-07-2014, 05:00 PM   #3 (permalink)
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I just got my realtors license in New Jersey actually. I was thinking of doing something similar, but wanted to learn more first.

One thing I'd say to avoid is renting out a condo. A lot of people think it's a good investment since everything is cared for with condo fees the owner pays. It really isn't a good investment most of the the time. You have to find a buyer who abides by the rules set by the owners. As my teacher put it with condos, you don't even really own it. You own the air in the room. You can't change anything.

Also, one of the bigger reasons not to invest in a condo is because condo fees are actually not tax deductible, while the payments on your house/apartment will be.

I recommend you read up on the laws for renters. Different states have different laws. In New Jersey the renter has all the rights. It's very hard to kick out someone who isn't paying, and can lose you a lot of money if you have the wrong person renting (of course do a credit check beforehand).


As someone who's new to investing, I wholeheartedly agree that you should start with being a landlord and renting a property. Renovating fixer-ups can definitely be risky without proper experience.

Before you invest, just make sure you think about all costs monthly you have to pay, and later costs since you're responsible for repairs, etc. This should be common knowledge, but should be reminded.
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Old 05-07-2014, 05:04 PM   #4 (permalink)
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First I thought Dukie was the OP, then I realised it wasn't. Then I though Dukie was the first to reply. Wrong again. You mods are an odd bunch. Except MAr, but she's different. Smoking hot and tat'd up.

I have some guys here at work who have various number of properties. Some are teamed up and others are solo. The last few years would have been a good time to get some rentals, but there are still deals to be had around here. I'd like to get in at some point, but can't for now.
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Old 05-08-2014, 04:22 AM   #5 (permalink)
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Buying a second, and eventually third place to rent out is on my radar. We (wifey and mmyself) currently rent out or house while we live our country hopping life for the last 8 years or so. We didn't intend on renting out the first one but life happened and now we live in our third country. We did intend to buy a place here in Australia to live, but reality is the stupid house prices in Sydney won't let us for the forseeable future. So next best thing build up some housing stock back home.

Goes without saying good tennents. Can be somewhat difficult.

And good property manager, if you aren't doing it yourself.

The usual real estate adage, location, location, location.

If you mortgage to buy, make sure you can have it self supporting, although depending where you are there can be tax bennefits for running at a (small) loss

It sucks having to pay rent and a mortgage if there are no tennents. Make sure you can afford an empty place.

At the moment we are planning on clearing the existing mortgage 15ish years early (end of next year at the latest, (although spendy stuff keeps happening, like unicorns and sudden trips to the US) and saving enough for a decent deposit (half maybe?) then getting the second place. Watching mortgage payments go out and not seeing the total drop by much due to interest is depressing, so I am trying to avoid any real sizeable one.

And hopefully will snowball to several houses from there, as more available income comes in to fund the next.
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Old 05-11-2014, 11:07 AM   #6 (permalink)
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I've been doing the same where we've been trying to pay off the house, and we've taking a really good chunk out of the interest payments. I could have it "payed off" in the next few years, or I could take some of the extra I've been putting towards the payments and then put it into a rental property.

I'd be able to afford a vacant house, so while that would suck, it wouldn't by any means sink me. I've also stocked up a reserve fund to afford any odd out of the blue repairs.

The cash on cash return is nice, and if I can pick up something where my cash on cash ROI is 5 years or less, I'd probably do it. I've migrated my looking from a single family home to a duplex. Sure the selling of it gets a bit more difficult (usually investors only, maybe a owner/renter potential), but the return is better and I plan on holding it for at least 5 to 10 years.

Maybe picking up a few more along the way.

The reason for the conflict is because it's a "buyers" market right now along with mortgage rates being very low an appealing. Not going to jump on it right this second, but sometime in the next 6 months I think I will. Maybe as we move into the fall and winter up here as prices usually get hit with a drop. I can do any interior cleaning and repairs over the winter and then rent it out in the spring. At least that's my current thinking.
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Old 05-11-2014, 12:16 PM   #7 (permalink)
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I'll pass on some rental advice from a very successful man I once worked for; Only rent luxury properties. Low to mid-level properties are fraught with peril and any profit can be quickly eaten up by one bad tenant. His opinion was that it is much safer to buy a property, remodel it to add the right touches (whirlpool tub, multi-headed shower, high end kitchen) and rent it out at a much higher rate (and security deposit). You are much more likely to get a better quality, less troublesome tenant.
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Old 05-11-2014, 12:42 PM   #8 (permalink)
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I'll pass on some rental advice from a very successful man I once worked for; Only rent luxury properties. Low to mid-level properties are fraught with peril and any profit can be quickly eaten up by one bad tenant. His opinion was that it is much safer to buy a property, remodel it to add the right touches (whirlpool tub, multi-headed shower, high end kitchen) and rent it out at a much higher rate (and security deposit). You are much more likely to get a better quality, less troublesome tenant.
Which is why I suggested (more of almost a mandatory thing), that he reads up on all on tenants rights in his state. Landlord's too of course.
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Old 06-17-2014, 10:49 AM   #9 (permalink)
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I started by buying a duplex and renting the other side out. Now I rent both sides and am looking a picking up a quadplex
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Old 06-17-2014, 12:26 PM   #10 (permalink)
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We have been looking for a rental, my wife up until yesterday was a NYS realtor and propert manager for a local office.
She got offered a full time gig elsewhere and just started yesterday.
We have talked about her going into her own rental management company which we think is still allowed. Had to give up realtor license since it was a conflict.

Another piece of advise, buy the least expensive house in the best or most expensive neighborhood.
This more for single family house but would apply to anything.
The least expensive house as the most potential for growth in equity.
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