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All Forum Posts by: Krystle Khoo

Krystle Khoo has started 10 posts and replied 39 times.

Post: make your case: Stocks vs Rentals

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Casey Mayton

Both, diversity is good.

Post: Re-fi back to 30 yr terms on rental homes?

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Joseph Agins

The YoY inflation rate for July CPI figures was 5.4%. The fed tells us this is transitory but the supply chain disruptions and reluctance of people going back to work probably means elevated inflation (over 3% annually) likely stays with us for another year or two.

Higher fixed-rate leverage on your properties with this type of inflation gives you higher returns in the long run, assuming the values of your properties rise with inflation and you're cashflow positive. For example:

Property is worth $100k, you take out a mortgage for $75k, and you see 3% inflation over the course of a year. Your property is worth $103k, you owe $75k (forget principle pay down for a minute), and you now have $28k equity. Your nominal equity just grew 12%, but that total value is worth 3% less due to inflation, so your real return is 8.7%. Debt servicing costs were covered by your tenants.

That's an 8.7% growth in equity without any appreciation, principle pay down, cashflow from higher rents, etc. purely because you're leveraged.

Debt is cheap right now. Take out as much as you can, leverage to the gills, and go diversify into securities or cryptocurrency.

Post: Fayetteville NC property manager?

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44
Originally posted by @Matt Noel:


 Hi Matthew I'm sorry I missed your tag earlier... it's still been working well with RJ and Amber. Did you get in touch with them?

Post: Fayetteville NC property manager?

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44
Originally posted by @Michelle Hansley:

@Krystle Khoo are you still using them and content with their service?

Yes! I am still using them and am content with their service.

Post: Solar panels for a rental

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Tanya F. Fair points, this definitely depends on the power company's policy on surplus generation. SDG&E would purchase surplus power at a reduced rate and credit that towards your purchase of power in the evening when prices were highest.

Post: Solar panels for a rental

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Kenny Hardcastle

Two more points I meant to add:

-The cons for the lein/loan option on panels are well articulated in the previous comments.

-Be wary of the added property value advertised by those selling the panels to you. Consult with local RE agents for a more realistic perspective.

Post: Solar panels for a rental

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Kenny Hardcastle

Solar panels alone will not offset your electricity costs. Most home electricity is consumed in the evening when your panels are either not producing or producing at a degraded efficiency.

To fully offset your electricity cost you will need batteries as well. A battery system for a small family plus electric car was going to cost us between $30-40k on top of the solar panels when we considered it in 2019 (Southern California).

Even if you installed a battery system, I'd be

impressed if you had enough southerly-oriented roof space on a duplex in Ohio to cover the needs of two families. Check your region's solar irradiance rating here: https://www.nrel.gov/gis/solar.html

With solar plus batteries your probably looking between $45-65k to purchase the system outright depending on your roof angle, size, capacity need, etc. Electricty costs from the grid are not high enough to justify this cost over the standard 25yr solar panel life span (not sure about battery lifespan, which is likely shorter).

With solar panels alone, the amount of bill offset likely will not justify purchasing the system outright (at least not in Ohio). Even with tax incentives/credits, solar panels only make sense if you value the contribution you're making to society enough to justify the poor return on investment.

Post: Property manager in north county San Diego recommendations

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44
 @Darren Tsai:
Ross and Stacey Derrod have been AMAZING so far. I highly recommend you give them a call. They know what it means to protect an asset for investors, all while being the kindest people to our tenants. Working with them vs our previous property management company (goldenwest- don't ever go there) has been like night and day!!!

Post: Construction Rising Lumber Costs

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

@Mike Terry

The Bloomberg podcast Odd Lots did an episode on lumber prices. The guest explains that new clearing restrictions in Canada a few years before the pandemic may mean prices will be elevated for a while. It's definitely worth a listen if you have time:

https://www.podtrac.com/pts/redirect.mp3/traffic.megaphone.fm/BLM1276673242.mp3?updated=1619374586

Post: Is out of state investing worth it?

Krystle KhooPosted
  • Investor
  • Hampstead NC
  • Posts 39
  • Votes 44

Hi Sara! We started out investing OOS into SFH BRRRR LTRs near a military base because it was much cheaper than Southern California. After the first 4, we moved to an area where the numbers make sense and has the same demographic (near another base). We are closing on our first local BRRRR later this week.

I don't see the need to be near the houses we buy and I actually won't even pick up the keys to this local house; our agent will pass them directly to the contractor.

As others mentioned above, it all comes down to the effort you're give that will determine OOS investing's worth to you. It does take some time to vet a team. Your returns will suffer more from the quality of deals you can find and less from the additional cost of a PM. You will lose a lot of off-market deal finding options and have to use wholesalers to find the best deals, with the additional cost of an assignment fee.

Simone is right in that this type of investing, local or otherwise, is not passive. It sounds like you've already seen that. But it can be a lot easier with the right systems in place. Investing OOS forces you to build those systems, which we find valuable. The PM will take their cut but it will leave you with time to focus on deal finding and funding.

I'm happy to chat about our experience so far if you want to learn more. Send me a PM!