All Forum Posts by: Duncan Taylor

It is not intended to be a loaded question. It is not a start up and I am fully capable of reading a prospectus. The prospectus makes assumptions about users relying on the cloud and the liability they take on in doing so. You could think of it this way, I am trying to verify the claims relating to user acceptance, not the liability question.

I am interested in the acceptance of relying on the cloud for the data storage verses other options.

Also, this goes beyond being a property management solution. I was happy with Buildium for that but, I plan to transition to this in 2014 because of the holistic ability to manage my business.

Tom from all you describe here it looks like you may have jumped into being a landlord without really understanding everything you needed to beforehand. Please don't take that as me piling on, every single person who has ever invested in ANYTHING has made mistakes.

However, you are where you are and you have to move forward.

First, if I were in your shoes and had to make a choice between paying the mortgage on the house my wife and kids live in verses a rental held in an LLC, the mortgage on the rental goes unpaid.

Second, serve her with the pay or quit notice IMMEDIATELY. Even if she has now verbally agreed to pay the rent. If she doesn't pay, evict her as fast as the local laws allow. If she does pay, follow the lease and give her notice you are breaking the lease. Life is way too short to deal with people like this.

Third, harden up, I see a lot of emotion in your writing and you seem to feel betrayed she would treat you this way, after all your kids played together. Owning rentals is a business and you have to treat it that way. It isn't personal unless you let it become personal. Keep it professional and sleep well at night.

Fourth, work out whatever you can with your lenders and then concentrate on digging out of the hole. If you have family who can help, all the better but that is an area where you should tread carefully and were it me, it would be the first moneys I paid back as fast as I possibly could.

I know it sucks to be dealing with during the holidays but you might come out better for it. It is not going to be easy or quick even if you decide to sell but it is doable.

I am trying to increase my understanding of how users are accepting or not accepting storing their business critical data in the cloud.

• Do you use any software which stores your information in the cloud?
• Is it a shared cloud or is your data isolated?
• Does the data you store there sensitive data like tax ids?
• If you aren't using any cloud related software, why not? And, what would it take for you to use the cloud?

Full disclosure here, I am trying to increase my understanding of this because I am considering an investment in a technology offering using the cloud. I'm not trying to get exposure for this company. I am just trying to figure out if I want to park some longer term money I have in a company wanting to extend their technology offering beyond their internal use. They have the best overall investment management system I have seen. I am a beta user and will definitely continue to use it after launch and will transition away from using Buildium. But, I am trying to decide if I want to be an investor too.

No, I mean the price you pay should be based on the value of the cash flow it will generate. Appreciation is not the play any more.

There is no housing bubble to pop. The market WILL complete its revision to the historical mean. We have slowed the process down but it will complete its correction. You can plot the long term performance of any market and any time it has had the type of run up we saw before 2007/2008 it eventually reverts to its historical mean.

The current stock market will do the same. We are experiencing new historical highs, the trend line is above the historical mean and rising, it will correct. It always has and it always will.

First, no one KNOWS what is going to happen. We all see the same signs, historical indicators and each draw very flawed conclusions based on our experiences up to this point.

Second, I don't see a bubble popping in real estate. What I do see is a completion of a revision to the mean. In the 1990's through 2007 we saw huge increases in home prices due to easy money. When the derivatives ponzi scheme collapsed, we saw huge drops, but there were no drops below the historical mean we would've had if the easy money were not there. In fact, we never got back to the mean before the feds stepped in and propped it up.

The market will complete its correction. It is a question of WHEN and HOW that happens, not if. We could have a sustained period of essentially flat prices until the historical mean is reached or we could have another lurch downward.

The thing to remember is, BUY THE CASH FLOW. Appreciation is not the play for the foreseeable future... at least in my opinion.

As for inflation, I don't pay attention to the government published numbers because we are not measuring inflation the same way we were 30 years ago. And, honestly, I'm not that worried about inflation because it too will correct over time. The only way inflation would be a huge worry is if your income were truly fixed. If inflation spikes, so will rents. If you have great properties in great areas, it will rise faster than inflation because in an inflationary market shelter costs become a leading indicator.

But, at the end of the day, as an investor we have to plan for the worst and hope for the best. That way, we always win.

Much of the macro economic theories behind Aftershock are sound. But, their interpretation leaves much to be desired.

There is a real danger we will see another down turn in real estate in this country. I honestly believe that and have adjusted based on my belief it will happen in 2014/2015.

There is certainty the US dollar will be fully replaced as the world's reserve currency within the next 10 years. It could happen sooner. Long before that happens our government's ability to borrow will disappear. That won't stop deficit spending because the Fed will continue to print money. But, we will see inflation spike. Those of us old enough to remember the late 1970s know how uncomfortable that can be but from a real estate investing point of view, it will be a non-issue. The next round of inflation will not drive up real estate prices like it has in the past.

I am not buying real estate here in this country right now. I expect to be buying like a wild man starting in late 2015 or early 2016. I expect many of my purchases will be from those who are over leveraged and under capitalized.

Opinions on leverage are much like opinions on religion. Ultimately, we are going to have to agree to disagree.

Some prefer the Trump model where you leverage when needed but keep that leverage compartmentalized.

Some prefer the Kiyosaki model where you leverage across the board as much as possible with no compartmentalization.

Just comparing the overall results of the two JUST in real estate tells me everything I need to know. :)

And for the record, I am not a Trump University attendee. Just because I think the business model he used to accumulate his real estate holdings is sound does not mean I buy into his hype as a guru.

Even if you have the most outstandingly wonderful property manager in the world, your time spent on these will never, ever be zero. And no matter how minimal your time spent on each one, you will spend more collective time as your holdings increase.

Only the late night infomercial gurus claim real estate investing is 100% hands off.

Let's make some assumptions...

Every month you have an additional $25K to invest. There are an infinite number of houses you can buy for $50K and each one will rent for $750 per month.

So, you can buy one outright every two months or you can buy one with 50% down every month.

After one year, you will have the same equity either way. Your balance sheet will look roughly the same.

Non-Leveraged:

6 houses, $300K equity, $27000 per year cash flow, total cash outlay $300K

Cash-on-Cash Return: 9%

All six of those could go vacant at the same time and you would probably be able to weather the storm without too much discomfort.

Leveraged:

12 Houses, $300K equity, $34200 per year cash flow, total cash outlay $300K

Cash-on-Cash Return: 11.4%

You have twice as many properties to oversee for a very small increase in your return %age. What's more, if you have even just a third of those have an extended vacancy you are dipping into profits, at half you are pulling money from other resources, if you have them.

If you spend just an hour each week per property you are spending 312 hours each year on your non-leveraged properties meaning you earn $86.53 per hour verses $54.81 per hour with your leveraged properties and 624 hours.

Leverage is a tool, like a hammer. But, just because you have the best darned hammer ever forged by man, doesn't make every problem or opportunity a nail.