All Forum Posts by: Glen Mauldin

@Joshua Thibeaux Several people have mentioned this and I will emphasize it. The best value you will recognize from this event is the opportunity to network. Meet as many people as you can and try to find a few will similar goals. If you can find someone that already has some experience in what you want to do then you probably got more than your money’s worth out of the event. Good luck!

I just stumbled across this article that may be worth reading:

https://www.msn.com/en-us/mone...

@David Flores the key to success on this type of investment is going to be the rig count. As drilling rigs are stacked (taken out of service) the number of oil field workers will decline. The industry is beginning to figure out that there is a limit to the number of horizontal wells that can be drilled on a lease without communication (interference) between the wells. It turns out that the optimum number of wells is lower then initially thought. I work in the industry and I am beginning to hear stories of people leaving the Permian due to work slowdown.

Yesterday I attended the Bisnow Multifamily Annual Conference for the Houston Market.  The majority of the attendees at this conference were mostly developers and commercial brokers, however there were some investors.  The majority of the panelists were in the Class A development/financing/operating space.  

Overall the Houston market remains strong, but there is some concern about the days ahead.  Class A rental market is improving with fewer concessions having to be offered by the owners, but there are several projects coming to market in the next 12 months that may change this.  In the luxury rental area it is still all about the lifestyle experience with many properties being of the mixed use variety offering street level retail and dining with living above.  One of the developers told the story of a property in Dallas where tenants using the pool on the roof can order food and beverage from a restaurant on the ground floor and it will be delivered via drone.

One area of surprise to me was the high-end condominium sales market is still very strong.  There are several condo projects under development and many individuals who bought in early have seen as much as 15% appreciation by move-in day.  Houston has been behind the curve on condo development and is just now beginning to catch up.  The empty nesters of the inner loop are selling their house and buying condos.  One of the most in-demand amenities in these properties is pet friendly units and common areas.

A couple of panelists were from New York and with the new rental regulations that recently went into effect, many of those investors and developers are looking elsewhere.

One common theme that seemed to carry across several panels was that many developers were having to "re-educate" their investors as to what realistic rates of return are today versus just a couple of years ago.  Some are seeing terminal IRRs as low as one-half what they were just a few years ago.

The one panel that truly intrigued me was the panel on attainable and affordable housing.  As in many markets, this is the one sector of the Houston market that remains underserved.  The panel consisted on the CEO of a non-profit that has developed approximately 1400 low-income units, she claims that this market segment is underserved by a factor of 4-to-1.  The second panelist specializes in small affordable units for new workforce entrants that want to live near their work, he actually told the audience that his segment is so underserved that he invites more competition. The third panelist develops work-force housing outside of the CBD area, but near public transportation centers (which is very lacking in Houston).  The last panelist was from the City of Houston to discuss how the city helps to encourage these developments.  The second panelist brought up the point that the City needs to adjust its building codes to adapt to the new realities.  He has to build far more parking than his tenants needs because the city's occupancy/parking ratios require it, about 1/3 of his tenants do not own cars.

Overall it was a worthwhile and very informative day.

I appreciate the input and realize there is no magic number.  I was preparing a personal financial statement and didn't fully realize just how much my wife and I had in our retirement accounts (first world problem I know).  It was just over 50% of our total net worth and when you subtract equity in our primary residence the retirement percentage jumped to about 60%. 

@Danny Rodriguez most of it is in IRA accounts primarily rollovers from prior employer 401K plans. Not self-directed at this time but I do plan on converting a portion of the funds to self-directed to do some note investing.

I guess my biggest concern about having too much in IRAs is the MRD issue whether we actually need it or not...once again, a first world problem.

I know that everyone’s circumstances will vary based on age, risk tolerance and other factors but in general, What is a reasonable percentage of one’s total net worth to have in retirement accounts such as IRA, 401K, etc?

@Terry Lao If two parties have their eyes on the exact same prize and only one prize is available then yes one party’s success came by way of the other party’s failure. But in many situations the help one provides may be the key to the other party accomplishing their objective. For example if a real estate investor can provide a quick funding all cash close for someone else who needs to sell a property fast, then don’t both parties win by each accomplishing their primary objective?

Perhaps partnering with someone "more experienced" will give her a level of comfort.

You have to shop it every year! I recently changed providers to one where the calculated replacement cost was about 20% lower then my existing provider, this the premium was significantly lower. I suspect my former provider was looking to get out of the Gulf Coast market.

I would love to know your agent’s source of information regarding the “capping” of the well. Wells get P&A’d when they are no longer economically viable. Many of the different state oil and gas regulatory agencies have information available about the fracking process put forward in easy to understand formats. One of my favorites is from CDOGGR (California Department of Oil, Gas and Geothermal Recourses). I also know TRRC (Texas Railroad Commission) has info available too.