All Forum Posts by: Ariel G.

Hi colleagues

I've been discussing this subject with a few people, and I get diverse opinions, what are your thoughts:

How rent values could be affected by depreciation?

Some people say there is a direct relationship, properties depreciate, rents go down, some people say they go up, or depends on the area. If it goes down would it be linear or maybe it goes down less than the property?

What's the minimal under market value % buy that provides a safe "insurance" against a potential negative CoCROI? 

How to estimate the inflection point of 0% ROI

I'd be happy to read your thoughts. 

Ariel.

Hi.

How does buying a turnkey property affect your ROI vs BRRR it yourself?
From where do they take their rewards and how does that affect your ROI and risk?

How can you be sure its a good investment, because of their high motivation to sell it to you, vs an impartial adviser that will guide you trough the process of buying, taking a standard fee not related to the property? Would it be enough to do some investigation on the market value for similar properties?

Hi, what and why would you recommend someone starting his first ever investment:

Multifamily with a partner

Single Family alone

Thank you for your comments.

Hi

When working with a friend partner in an investment, such as 50/50 downpayment, whats the accustomed way to get everything done in manner to avoid errors and losing friendships and partners? How tough should you be on doing contracts and insuring protection against misunderstandings, lawyer supervision, etc? or should you be lax in some way for any specific reason? Sometimes discusions may arrive when there a confllicts on intersts (selling, not selling, changing administration companies or not, removing or not lenders, etc I assume) 
What are your thoughts and how have you handled it? 

Hi. I've been trying to run the strategy for investing without the
oportunity of a conventional loan.

I've been trying to run the numbers, because it didnt seem to work out
for me because of the higher interest rate of a HML compared to a
conventional mortgage, that sometimes is the only option for a
foreigner like me for example.

Please Id apreciate coments on the calculations to double check if
they are run down well. I'd love to read from foreigners or others
that succeeded doing it without a mortgage in the past, from HML,
refinancers, and of you people with experience.

Plan: For a $100.000 property, 80% LTV loan by a HML at a 10%
"interest only" anual rate, then refinanced by a new loan at a 6%
anual rate as soon as tenant stabilized.

Asuming a 1% rule rent of property value, that would be 1000 a month,
so 12000 a year Gross income right?.

By deducing the loans interest: 10% x 80.000 = 8.000 total yearly interest cost.

Considering:

5% vacancy rate = 720
5% for maintenance costs = 720
7% for propery management= 1000

So NOI= Gross income - interest - other costs= 12000 - 8000 -
720 - 720 - 1000 = 1560 a year correct?

ROI (HML 10%): NOI/20% invested = 1560/20000 = 7,8%
ROI (Refinanced 6%): 12000 - 4800 - 720 - 720 -1000 = 23,8%

This of course pretax.

What are your toughts? Is this correct? Are these numbers reasonable
and reachable? Anything missing? Thanks.

Thank you @Chris T.

As Im beginning to unsderstand, most of it is about the lawyer and title companies, correct?

You are creating a contract thats saying the property will be transfered to you at such and such price when such and such conditions are met. So the owner or the turnkey company that is selling you wont have a chance to con you, the lawyer company wont risk their reputation with a contract that got you into a big problem, correct?

So could we say this is the point we stop finding more confidence? The moment you just have to jump at the sea and take a chance? Find those players, and after that "The rest in heavenly", or is there other things to be done before throwing the ball to the sky?

Thanks.

Ariel.

How do you get to become confident on throwing the money to your first investment?

I heard some stories of people from out of the US investing in properties and after a few months the property is not yet at their name, stolen. What's the best way you can have a safe legal protection to go on with that first deal?

Thanks.

Ariel.

Baruch Haba

Behatzlaha

Ariel from Jerusalem

Id love this info as well

Thanks. Ariel.

Hi Rachel, and in your opinion what are the best locations for buy rental properties and why? Where did you decide to invest? Thanks.