All Forum Posts by: Giora Sela

I was offered a deal on a 23 unit 3.5 acre park with another house for $750,000 in NC. Location is fairly good, land is on a major rd and the back part of it connects to an established neighborhood with older brick SFR’s All units a tenant owned, utilities aren’t included and overall condition of the park is on the low end. Main driveway is practically dirt pavement mix. Pods are rented for $275 which is $75-$150 lower then larger parks within 2-3 miles that are in a nicer park. Taxes are $6000, manager lives at site in a separate building which is the office essentially. The owner turned down an offer for $625,000 from a different buyer yesterday and the agent is insisting this is a 20% cash on cash deal with 30% down over 20 years. It seems too good to pass so I’m intrigued but I don’t have enough knowledge to tell what I’m missing

You need to insist on getting at least 2-3 months of bank statements even if they want to blackout personal items. Adding up the total rental income each month would tell you what those units are rented for all together. Sounds like they don’t really know who paid and who didn’t each month so I doubt it will match the leases 100%. Anyone can state rental income on their tax return regardless if they actually collected rent.

Why could they pay rent a year ago but not now? Seniors live on a fixed income and the only valid reason would be medical expenses which they can always avoid paying the 20% Medicare doesn’t pay and leave it for collection. If rent is too high then they should be able to afford living where other poor seniors in the area live with just social security income. Ask to see detailed bank statements from the last 12 months, I promise you will find out quickly where the money is going

The real question is why is the property vacant for over a month? Are you charging too much? Are you able to verify with previous landlord if they had any damages before. I would consult with your insurance agent to see what are the details of your policy regarding the dogs.

Google earth might let you see if there’s cars from above vs street view.

Originally posted by @Arun Iyengar:

@Giora Sela,

Thanks for the response Not having insurance is not an option. Will be a while before Medicare eligibility comes into play. For the $50-$60 for a policy, what type of policy were you referring to. With the ACA penalties being removed, where are these policies going to be offered in the future? Any knowledge here would be helpful to many people.

 You can also purchase short term medical policy with pre existing exclusion and possibly a waiting period for certain conditions. Typically 30-40% cheaper than ACA plans. I would just call a local agent and ask about that, CA is always a pain for some companies and they might not be offering many options there. 

Most insurance agents can help you with those policies that I mentioned earlier, ask about a Critical Illness policy. Call Cigna or Aetna and ask if they can assist you with that in your area. 

If you can afford an ACA policy it would definitely be the best option for you, I only suggested not having it if it’s not affordable. 

Disclaimer- I’m an insurance agent dealing only with Medicare insurance and more... Since Trump canceled the penalty for not having insurance I would most definitely not sign up for Obamacare if you’re fairly healthy. Keep in mind that in the event of an emergency you will be treated, but more than likely get significant bills afterwards. Might hurt your credit score in the short term if you can’t make payments but if you’re retired then credit is pointless in my opinion. A few loopholes exist that will allow you to “relocate” and will trigger a special enrollment period to enroll the following month. Regardless each year companies still have to accept you during open enrollment and they can’t exclude prior conditions. For a peace of mind I would pay $50-$60 for a policy that would pay you a lump sum of $15,000+ in the event of a heart attack, stroke or cancer. When you get on Medicare drop it and buy ONLY a Medicare Supplement plan G/N. Its just very hard to actually benefit from a $400/M policy with $5,000+ deductible. Your out of pocket $11,000 before it kicks in

No investor plans on failing or filling bankruptcy, but still it happens all the time. You also can’t plan for the worst case scenario because it’s impossible, instead you need to balance leverage/risk. Buying only cash is probably a mistake, but so does 100% leverage. You spend years building a portfolio and all it takes is a few months/years to potentially lose it all. Banks keep a certain LTV requirement because statistically they deemed it safer for them over a long period of time.

Originally posted by @Tom Gimer:

@Russell Brazil @Giora Sela says "Smarter people will hopefully figure this use case in the future."

Hope isn't working yet. Here's the latest: https://www.nbcnews.com/news/world/bitcoin-heist-6...

 Bitcoin was never hacked. Companies/Users got hacked and their coins stolen, the records  ladger containing the data was never hacked. 

Technology is too young to know exactly what will be done with it 5-10 years from now. 

Who knows, maybe you could even syndicate and raise funds using bitcoin & blockchain someday

Originally posted by @Tom Gimer:

Originally posted by @Giora Sela:

Hopefully in the near future blockchain technology will disrupt the title industry by not needing a 3rd party to search/verify titles. Records can’t be manipulated and all past transactions would be transparent.

Let me make sure I understand this. There is no third party in this scenario? 

Yes that’s the concept of blockchain technology, you don’t need a 3rd party to “vouch” for the other party. Its 100% accurate 100% of the times. It’s too complicated for me to imagine the fine details for this to become reality, but smarter people will hopefully figure this use case in the future. No 3rd party can provide such guarantees because they can make errors or get compromised. 

No one is capable of hacking the actual ledger on the blockchain as long as it has enough scale.