All Forum Posts by: Jordan L.

http://www.theintricatedesign.com/

Their website. I know nothing about decks. Seems ok.

So my renter's lease is up. He said that he has a friend who builds wooden decks professionally. He asked if they could build a deck in the backyard. Labor will be free, but he's asking me to pay for the materials. Don't know how much it'll cost. As a show of good will, I'm inclined to ok this depending the cost. I say, one month's rent sounds fair(1100k). Of course the friend has to show proof of having work comp insurance.

Current loan 6.125% 30 year fix finishing year 7 next month. Loan amount 119k. Principal/interest $857 per month. If I don’t refi and just keep paying the minimum, I will have paid $236,532.

I can refi at 5.125% 30 year fix. After fees, loan amount will be 125k. PI will be $606 per month. After 30 years, I will have paid $218,160.

As for the 2 properties I was eyeing, they both went pending yesterday, so the point is moot.

This was what I said about my RE investments:
"Now. I'm not expecting these types of returns. My investment growth expectations come from my mutual funds/stocks. I consider RE my inflation hedge(lock in low interest, creep up the rent as population and money supply grows, build equity with mortgage pay down, appreciation only considered as icing, but not expecting it)."

You're right about having cash flow to support a property. While it may be foolhardy and naive, I don't mind paying a premium and having less of a cash flow margin for a newer property.

This is what I said about real estate in my last post:

I think my experience in Southern California may be skewed. But my uncle's experience is not a 1/100 longshot. I have a whole slew of family examples having bought new and improved their wealth.

My parents and their friends are from Asia. They all immigrated here in the early 1970s. They could barely speak english and certainly weren't RE experts.

1. You know my 1st uncle's experience.
2. My god parents bought and moved twice over 20 years. They held on 2 homes as rental properties and after 25 years ended up with almost a million in equity and 5k in monthly cash flow.
3. My parents bought in 1975, but sold to upgrade. Had they held on to the 100k home, they'd have 650k in equity and 2800k extra in cash flow.
4. Another Aunt/uncle bought their home for 80k and bought an adjacent similar home. They have about 600k in equity and live off the rent from the 2nd home.
5. Another uncle bought a 4 plex. Don't know the equity or cash flow, but he's had it for decades, and from a financial point of view, he's the best one off.
6. My godfather's brother bought the house next to him. Don't know their cash flow, but their equity is well over a million dollars.
7. Another Uncle and Aunt bought a 8 unit apartment and held on. No cash flow for the 1st decade. Now they have a torrent of cashflow and bunch of equity. Enough to pay off their son's tuition to Stanford and Med school without having to bat an eye.

None of these examples are in the same city, all spread out in various southern california suburbs. No war zones. No buying and selling. They were all engineers, so hands on, they all had profit eating property managers and just held on.

Now. I'm not expecting these types of returns. My investment growth expectations come from my mutual funds/stocks. I consider RE my inflation hedge(lock in low interest, creep up the rent as population and money supply grows, build equity with mortgage pay down, appreciation only considered as icing, but not expecting it).

These both sold at the peak. The smaller sold for 288k. The larger sold for 387k. So, no, not 500-700k. Location is in the Tacoma, WA, not CA. I'm an out of state investor. Repairs for these 2 are minimal.

My plan is to put down 25%, buy, and hold. Maybe I might sell one or two to pay for my kids(they're toddlers now) colleges, but my hope is to generate enough cash flow in the future to pay their college bill as it comes due.

Right now, I don't need cash flow. If I do get a positive cash flow even better. I want to build long term wealth. I'm willing to pay now and reap the rewards later. I don't need the cash flow from day one.

Maybe 2 months ago, I posted a question about my uncle buying his primary residence 30 years ago, for 150k. He moved to another place but rented this original property. It's now valued at 700k(post bubble burst), paid off, and he rents it out for 3100 a month, a nice additional supplemental income. I asked if he were an RE investor. I got comments like, he was lucky(probably), he's better off than 95% of the rest of the population, he's not an good RE investor just someone who makes passive income on one rental property.

To me, the people on this board are savvy investors, probably based on the 2-50 paradigm. I don't have the time to be this good. Plus RE equity is only going to be 25-30% of my net invested assets. I'm trying to duplicate what my uncle did, just by a few multiples.

I don't mind getting slammed her on this board, cause the tid bits I get here are sometimes pretty valuable.

It's my investment strategy. Buying newer properties to hold for the long haul.

I've got two homes I'm eyeing. Both built in 2005. Location the same. One's 1900 sq ft home selling for 190k. Will definitely rent out for $1500 a month. Another is 2950 sq ft home selling for 220k. Will definitely rent out for $1700k but if you're willing to wait a month, you might get up to $1900.

While I know neither of the 2 fit the 2-50 rule, and not even close, if you had to, which one would you do?