All Forum Posts by: Errol M Tazbaz

@Zachary Beach This is a perfect answer. I completely forgot about depreciation and tax brackets. That might make all the difference.

I'm still in the cashflow phase of my investing journey so that doesn't work for me yet. Hopefully one day.

Like I said before, this is not a one-off. I have seen this often. Only reason I can think of is they are parking money and don't care about returns. This used to be more common with foreign investment but I think that has dried up in recent years.

Even if they bought all cash the CoC is only 1.69% and 5 year annualized is 11.2% assuming 10% appreciation. Seems like there would be better investments than dealing with being a landlord for those kinds of returns.

Ran an analysis on this one. They are losing $2500/mo assuming 80% LTV and CoC is -11.27%. Assuming 10% appreciation the 5-year annualized return is 31%, but they are speculating that the market will perform like that for next 5 years. Anyone know why people do this? This seems quite common in my area. I feel like I am missing something because I am only looking OOS due to terrible CoC and negative cash flow in Seattle.

https://www.biggerpockets.com/...

https://www.zillow.com/homedet...

@Megan Shay does Kitsap cash flow? I am trying to mentally wrap my head around investing in markets that will provide the best return and not limit myself to geography. I also want to build the muscle of assembling teams remotely so I can repeat the process in whatever market has the highest potential.

I live in the Seattle area and investing here is out of the question. Looking to invest OOS. Based solely on price to rent ratios Rochester, NY, Philadelphia, PA and Columbus, OH look good. There are of course other towns that have even better ratios but these seem like they have a good balance between price to rent ratio and appreciation. What do you guys think? How do you determine where to invest? I don't know anybody outside of Seattle or other high priced areas I have lived in, so all cities are equal to me in terms of having to create a team from scratch. P.S. I'm looking to buy 1MM worth of property this year with 20% down and am looking to BRRRR these. I am open to both SFR and multi-family.

Hi Sophie,

I am leaning towards selling and investing out of state where the rent to price ratios are better. If I can make BRRRR work then I wouldn't have to tie up the equity and can recycle the money over and over.

cheers,

E

I wasn't sure where to post this. I see Brandon and David doing this super fast. They draw a rectangle around the property image, snip  and drop it in when using the analysis tool. What are the steps to do that? I have to save an image then navigate to the folder the image is in and insert it. much more manual. thanks in advance.

Hello BP community,

Good to be here among you folks. I have been bitten by the RE investment bug and am devouring as much information as possible before jumping straight in with my family's life savings. Specifically reading books from Brandon and David and watching different RE investment and management channels on youtube. We currently own a home in Bellevue WA with about 50% equity and between my wife and I have great credit and good stable jobs. 

Here are some facts: We are shopping for a new house in a better school district and we need to decide what to do with our current home. Our current home has had all of the big ticket items addressed recently. Roof, AC, sewer. It is basically in very good shape, some (our RE agent) might say too nice to rent out. I used the rental calculator and the CoC isn't very good because of how much equity we have in the house. The equity allows for modest cash flow but the appreciation has been insane in our area.

Here is the question: I am interested in using the stack method to do BRRRRs and want to get into multi-family. Would it be better to rent out our current place and gain experience in property management on a property I know well that has low chance of needing major repairs or would it be better to sell and pull the equity out and start with multi-family from the get go? We currently have an untapped HELOC against the house so have access to substantial equity w/o selling plus we have additional savings to fund a large down payment and rehab on the next investment property.

I feel like gaining experience through learning from others, falling and getting back up to master all of the different aspects of BRRRR is essential and figured using a property I know well might ease the transition into BRRRR but the CoC numbers are not very good so this thinking might be antithetical to BRRRR.

I am also open to partnering with someone who has experience in BRRRR and am willing to contribute capitol and hustle. I want to learn through doing. If you made it this far, thanks for reading.

Errol