All Forum Posts by: Michael Slockers

Probably worthy of an entirely separate forum post, I wonder how many of the landlords who get in trouble would accept government help if it were offered?

In the case of the bailout talks I've heard, the scenario would not be "free money", but moreso the government saying: "I'll pay you 6 months of lost income on the basis that we have a 5% equity in your home." This is completely hypothetical of course but this is what sounds like may be offered to major airlines, etc: Bailout money in exchange for stock/equity.

I wouldn't take it but then again I hope to not get in a situation that desperate...

Lots of great discussion. I wonder if in this case it is better to have only a few investments, or to have a large portfolio? I suppose there are many more factors at play such as true cash flow, equity, tenant-base, etc.

Even with my worst-case-imagination-cap on (I bought it on ebay), I still can't imagine how this will financially devastate us. We will still continue to pay our mortgages, taxes, etc. We have some reserves. Again, I encourage all landlords to really consider a grace-filled approach to issues your tenants may experience. This in unprecedented.

@Jose Zaldivar I struggle with this question. I saw an email from a wholesaler/investor the other day titled "your tenants have Coronavirus!"  In his email, he described how a landlord called him, his tenants were sick and he didn't know what to do, so this guy bought the house. 

I get your question but just hope it doesn't open people up to predatory practices.

One upside could be people realizing the real volatility of the stock market. They could be your next private investors!

@Mike Bonn Interesting to hear the bankers' perspectives. I've also heard mention of government-control of foreclosures during these hard times. 

@Cassi Justiz I get what you're saying about bars and restaurants closing. The flip side of that is that our tenants won't be wasting as much income on bar and restaurant food (nothing against it, but you see my point). 

Overall, this is an economic nightmare. I explained to my kids yesterday that this last week we've just had will be written in the history books. Unprecedented, and impactful to so many. The ripple effect is unbelievable. 

Very insightful post and discussion. I don't know how we will handle if tenants cannot pay rent due to these crises, but I think we will lean on the side of grace however much we can. 

@Lowry Coe LOL "But it's still Oklahoma"

That it is, my friend! Where people are nice, real estate is (fairly) stable and boring, and cash flow is achievable!

I think it's a good rental market. Tulsa is pretty heavily based on oil and gas, though not completely. Just check the news, oil and gas is no bueno right now. That could mean a good time to buy in Tulsa is coming up? 

If you have any more specific questions, reach out. We have rentals from Skiatook to Jenks and Broken Arrow. We have flipped in all of those areas as well. 

@Marcello Oliveri You might check near the TU campus, or in up-and-coming areas such as Pearl District. I bought one in Pearl District that I expect to appreciate and definitely hits 20% COC or better. It was quite a fixer though...

@Damian Gutierrez In theory, it should work. I think buying below market value is going to be the challenge (since you only want to leave max 10k in the deal, you will need to have built-in equity to get your money back out). I'll keep my eyes peeled. You may start looking for good wholesalers as that may be your best way to get a property at a discount.

@Haley Powell

Another way to analyze this: which location can you actually afford given your savings and financial standing?

And if you are just getting a typical $200/month in cash flow from an investment, just be prepared, it will not change your life at all in the short term. $200 from an OOS investment will NOT really help you in your living situation in Dallas. You'll burn that up on commuting gas and parking costs each month. 😬

House hack sounds ideal but maybe wait and see, keep saving, and don't rush in to any market.

@Shawn Regnier props to you Shawn. Return on equity is the ideal way to look at this in my mind. Monthly cash flow is insignificant, return on equity for a cash flow investor is critical. You don't hear too many people talk about this important metric.

Side note: ROE actually goes down over time, particularly in an appreciating market or due to leverage on the property....or both like in the case of the original question.

Anthony - 

Google could tell you this better than I could. But if you look at the swing UP in markets like Denver, Dallas, coastals in the last 10 years, I think you'll see it has "appreciated" much more than the OK markets. Those markets may be more susceptible to a downturn as well. I consider the OK markets pretty stable and don't bounce as much or as fast as the some of these other hot-spots where appreciation has made many millionaires.

 I agree - I've looked elsewhere and have found Tulsa-area to be fantastic cash flow. Of course there are better appreciation markets if that's what you're looking for.