All Forum Posts by: Adam Berlinberg

I am looking to get started in real estate investing, and looking for guidance. I am not looking to replace my regular job, but rather long term growth with shorter term cash flow. I am lucky that my wife and I do well, with an average income of $500-600k. I am in one very solid commercial syndication right now. I have about 75-80% of my investments in the stock market in one way or another and looking to diversify. We have a primary residence with around $350-400k in equity and no plans to move. I have around $60k in the bank right now, but could get that quite a bit higher if needed over the next few months. HCOL area that is difficult to find cash flowing rentals. Out of state rentals? Multifamily? Stick with commercial syndications? My thought is start building a portfolio of single and multi family rentals (probably out of state just because I'm in one of the hottest markets), and just grind by adding. I think I could do 2-5 houses a year with savings. Keep scaling up aggressively? Tap into our home equity for more of a jump start?

We have a SFH that we have lived in for four years, and looking to move a few miles away into a better school district as the kids are reaching elementary age (and homeless issues, and neighborhood not as great as it used to be). We have about $350,000-400,000 in equity in the house (very hot market), and our rate is 3.1%. If we can swing the cash for a down payment on the new house, is it worth keeping the current one and renting? Not a ton of rentals in the area, but still a very nice neighborhood and comps would be a cash flow of $700-800 a month (minus property management). Not sure if it is easier or better these days to just take the tax free equity and not worry about it, or if hanging on to a low rate SFH is worth it these days. High income household and involved in syndicates but no individual investment properties owned (though interested).

Thanks for explaining. Nowadays it's hard to find things that cash flow well due to housing prices and interest rates. Looking across a lot of different markets, not much in the SFH world is generating more than a few thousand a year. I guess I don't see much of the tax benefits expect not paying taxes on the couple thousand that is generated in cash flow (which can be really helpful if you have a ton of properties). Maybe it's just the market we're in now where making monthly cash isn't as feasible.

I'm new into the world of real estate and close to getting my first rental property. I'm still confused on tax benefits and looking for some assistance. I'm a high earning W2 household ($400k), and I also have around $75k 1099 income annually. Say I get a SFH that cash flows $200-300 a month, what are the tax benefits? How does depreciation and expenses (mortgage interest, property manager, etc) help? It's not against W2 or 1099 income in this scenario? Purely against the passive $2500ish a year net cash flow to zero it out? Thanks

Looking at a 6 unit rental as my first multi-family. HCOL city using 30 year commercial loan fixed at 6.5%. Total cost $1.15 million with 25% down. All units currently occupied and is in a trendy part of town in which occupancy hasn't been an issue. Current collected rent is at $86,000, and is under market. Getting up to market will bring it around $93,000. Owner responsible for water and trash. Taxes are $5500 on current value, and insurance around $2400 for the year. Big ticket items including roof updated within past few years. I'm getting it around a 7% cap and 7% COC. Seems like a pretty good deal? Am I missing something? Will probably go into it with a partner as I just tied up a bunch of cash on a syndication and am stretching a bit.

I am in the process of getting my first residential deal, and just making sure I’m not doing something wrong. I think my realtor is and just trying to sell as quickly as possible. Duplex in VHCOL city listed at $849,000. Just dropped $50k, which is the first red flag as things go quick. Current rent in one half is $2750, other side vacant. Market rent is around $3000 each side ($6k total). I am doing conventional 30 year with 20% down at 7% rate. No utilities. Taxes were $3550 last year, insurance about $200 a month. Property management around 9%.  I’m getting that to be about a 5% cap and -1% cash on cash. He is somehow getting 10% cash on cash and says it’s a winner. He also says you can’t including reserves for vacancy or maintenance and that is old school, again just making sure I’m not missing something. I think this one is a hard pass, he thinks it’s gold, just looking for outside advice.

Totally fair. I have rent roll and expense data the past few years. A large remodel as done a few years ago, so not huge upgrades that need to be done now. Of course lots of issues and upgrades will come along. Having a good property manager will be helpful with that. Luckily I have a high paying job and can absorb a fair amount, then finding financing as needed.