What was your initial price threshold?

[Shawn S.]

On your early properties for buy and hold investors, was their a price range on properties you would look to where it seemed if you went lower the place was not quality enough and if you went higher the rent seemed to lessen from a percentage standpoint comparted to the property value? So far I've mostly shopped in the 40-70k range. A downside of going higher for me seems to be that the down payment of course is higher. But long term I'm wondering if I should allow that to be a factor.

[Jeremy VanBussum]

Shawn Sorter - Real Estate for me is just like investing in your IRA. There are properties that are income properties and there are ones that are balance sheet (growth) properties. I'm just getting started, but I have one of each and like them both.

My first house was $128K. I consider this a balance sheet property. It is in a highly desirable area and I expect it to appreciate over the course of three to four years. I will have no problem selling this property quickly when/if I want to free up capital.

I just bought a house from HUD for $27K. This house rents for $825. Its obviously an income property. The problem...the area is nothing to brag about and I don't see this property ever regaining its value that it had four years ago. With Dodd-Frank in place, it will almost be impossible to sell this place unless I finance the buyer. That said, I consider it a higher risk property, but as we know, with higher risk comes higher return.

Diversify your portfolio :-)