All Forum Posts by: Brian Shaha

@Chris Montgomery - Sorry it's been a while. I am from Kenosha, WI and I am sure you have seen what has been going on up here....

So my game plan for now is to hold off on any large investments until after the elections. I feel like the economy is heavily effected and dependent on the politics.

I have also been looking at diversifying my investments into new ventures. I did do some research on OZ's and its was an interesting option.

Once again thanks for the input!

A direct answer to your question:

Many times the bank will take a much lower amount that the plaintiff owes on a house. For example if someone owes $150k the bank may have the starting bid start out at $100k

Sometimes others will not even bid, and you can pick things up for cheap!

Another strategy for me has been if you know there are 1 or 2 serious bidders at the in person auction, tell them you will give them $1,000 not to bid on that house. Do that with a few people and you just saved yourself a bidding war that might have ended up going up $10k+

Not sure about "HUD" but I have picked up houses from sheriff sales / foreclosure auctions at $70k before. This is in Kenosha, WI (center point between Milwaukee and Chicago)

Purchased at $70k put about $20k - $25k into it, and sold for $125k

Process took me about 4 months at that time from purchase to sale.

The first time I got into residential real estate I did 3 homes in my first year. I sub contracted all the work and never really swung a hammer. I just supervised the work, sourced all the material and labor, and paid an agent to list and sell the homes.

With the foreclosures commencing again, I am thinking of getting back into this as my "trial" the first time actually went pretty well.

Craig, thank you for the in depth insight. Very helpful to see it from someone else's perspective.

I believe that the after effects of the current "lock downs" are soon to be seen, and the negative results we have seen so far are not even a glimpse of what is to come. I say this because the economy has been artificially kept afloat temporarily and that can not go on forever. If and when congress starts to cut back on spending, then I believe we will really see the true impacts of this whole situation we are currently in.

For now I will eat the taxes on my 1031 (identification ends in about 3 hours), wait on the elections / see what the political agenda has in store for us, and then consider investment strategies.

Here is another question, where would you seek to learn about other types of investments outside of your comfort zone? Have you ever taken a risk on investments that were very "new" to you or that you knew very little about?

All I know is hotels, hotel operations, and other smaller residential real estate investments. I have never looked past brick and mortar , but would like to learn and possible take a calculated risk.

Thanks Craig, thanks Bill for your responses.

I guess the more refined question is, how hard do you think the recession will hit?

What is your personal opinion? Would you invest right now? Are you anticipating a huge downturn in the markets?

Bump!!

Bump

Hey JJ, thanks for the input.

Rather than looking at percentages, let's look at numbers.

*$250k in gains tax

*Hotel with 100+ keys right now  in the economy brands around $40k/key = $4MM

If the values adjust by 10% that's atleast a $400k reduction.

The way I am seeing it is pay $250k now, save $400k later (NET $150k+ gain)
Investment safer at a later time since we can see how everything stabilizes after the elections.

I'm stuck!

Hey Everyone,

I am new on here, but I have seen some good posts so here we go!
My name is Brian, I am 28 and I am in the hotel industry.

Long story short - I usually like to purchase economy brand hotel assets around $35k - $42k / key @ <3X Revenue
This criteria for my purchases was pre-covid19

Right now I am seeing alot of properties come up for sale, but not at the price I anticipate they will be in 12-18 months from now.

I guess the biggest question is, is the economy going to recess hard? Should I just pay the $250k and hold onto about $550k hard cash and wait to invest?

My though process is that the 30% gains tax ($250k) I will have to pay will be offset by seeing hotels go into foreclosures and maybe purchase them at a discount far greater than $250K?

A property I paid $4MM for was purchased by an investor in 2013 at auction for $1MM cash.

Any opinions? This whole economic climate has me doubting myself or at-least my past experience which has only been in a strong economy.

Any other investment ideas? I am stuck on paying the gains tax or reinvesting.