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All Forum Posts by: Ethan Carbonaro

Ethan Carbonaro has started 4 posts and replied 7 times.

Quote from @Taylor L.:

IRR isn't the same as compound interest. It's a very different calculation.

 Thanks for the response! I see this now, but I still don't understand how I can leverage compound interest in real estate aside from investing Cash Flow and Tax Benefit cash into stocks/other rentals.

Hey all!

I'm struggling to understand what seems like it should be a simple concept: compound interest in real estate.

Here's my dilemma. I used two calculators: a rental property calculator and a compound interest calculator. For the rental property calculator, I plugged in a $43,000 down payment (20% on a $200,000 property + $3000 in fees) plus some other figures and it gave me an IRR of 12.8 percent over 30 years. The total profit when sold added up to $662,022.

When I plugged in $43,000 into the compound interest calculator and had it compound at 12.8% over 30 years, the total was WAY higher at $1,595,929.

Why is this? What am I not taking into account in order to get $662,022 up to $1,595,929? How can I leverage compound interest in real estate investing?


Any help would be greatly appreciated! Thanks in advance for helping me understand.

This is super valuable; thank you, Evan. Great insights. I especially love those four factors you mentioned when picking a syndication: property, sponsor, plan, and execution. Do you have any recommendations for how I can learn more about picking the right syndication?

Thank you again!

Quote from @Jim Pfeifer:

My returns are as good or better than my active investments.  I think this is a place of misunderstanding for many people.  If you are an active investor, it is possible to beat the returns of a syndication - but you need to know what you are doing, be in a market where you have some type of advantage and knowledge and you need to be active - you cannot rely on others to manage the asset for you.  If you can't do all that, I think you have a much better chance of success in passive syndications.

Thank you so much for the thoughtful response, Jim. You put words to my hunch. Private ownership seems so cut-throat, and success seems reliant on providing more effort/knowledge. I value the passivity and believe that an expert would achieve better results than me (even factoring in their cut).

Have you personally used Tribevest? I will look into it if you know from experience that it's good.

Thanks again!

Hey all! I'm trying to learn about real estate and have a pretty basic question:

What are the differences in returns of privately owning a home and renting vs. investing the money in a real estate syndication. Are these even directly comparable?

Let's suppose I have $50k. I know the time horizons are quite a bit different and the strategies can vary wildly, but generally what changes if I owned houses for 30 years vs. invested in syndications for 30 years (in the normal 3-7 year increments, rinsing and repeating)? Is there a big difference in what I could expect in the end?

Again, I'm really knew to this and just want to get my head thinking right. Sorry if these are really bad questions/too general :)

Thanks for any help!

I am very interested in maximizing the potential of co-living, but I don't want to disobey local ordinances. Are there any places which do not specify how many unrelated tenants can live in the same house? Alternatively, do you know of any cities which allow for large amounts of unrelated tenants (such as 8 or 9)?

Thanks for any and all help you can offer!

Hey all! Sam Wegert's podcast episode about Co-Living investing inspired me to setup a BP account and seek more information.

After looking at my local occupancy laws in and around Nashville, I'm finding that most places are not allowing more than three unrelated occupants per house. Sam mentioned that he does not follow this ordinance in his most recent home which hosts eight unrelated occupants.

Questions:

1) What places (types or specific) stand out to co-living investors? Are these places based on the amount of unrelated occupants allowed?

2) Is this a worry to co-living investors? Sam mentioned it but seemed unconcerned. Do people get warnings and fines? Do tenants ever complain to the authorities? How seriously are these ordinances followed/enforced?

Thank you for any help you can offer!