All Forum Posts by: Doug Henson

Hi Jean. I was in Myrtle Beach back in July and bought a forclosure. The place was listed at 129,900 and we bought if for 117,500 - This happened in three days. Now we wound up with a fantastic real estate agent down there who knew the person in charge of the property with the bank and I suppose that is why it got done so quick. Proving once again I suppose that it sometimes is not WHAT you know but rather WHO you know.... ;-)
I fail to understand why it is that banks are so slow to act on any reasonable offer, it should be interesting to see what effect the government bailout will have.

At Myrtle, the main season is from June to the end of August - and it is berserk. From September to November and from March to May are what they call "shoulder seasons" which are primarily filled by golfers such as myself - and there is plenty of golf down there. The winter months do yield a fair amount of days suitable for golf but what keeps the the resorts fill in those times are conventions. They recently built a very large convention centre not far from where I bought. So I checked out the income for the previous 3 years, subtracted their 45% and then simply deducted my carrying costs from the remainder and it was a number I was happy with. I am hoping to make my money when the market improves and I sell at a profit 7 or 8 years down the road. I look at it this way, I am not the smartest guy in the world and I know it. There are plenty of people in this forum that can confuse me in a heartbeat because they REALLY know what they are doing. It does not take a genius to understand that now is a very good time to buy U.S. real estate (buy low -sell high) If you can afford to buy and hold for a while I really think you have to make money. Has the market bottomed out? I don't know and do not claim to but it is bound to be higher 5 years from now. Everything is cyclical and the U.S. is too powerful and too great a country to languish for long - it will be back.

You can stand around and overthink what even a doofus like me can see is an opportunity that we have not seen in my lifetime before and I hope we will not see in my lifetime again. It takes courage for sure - I am freaked to be quite honest but I really believe in the U.S. to come back strong. It is just going to take time.

I do not really be all that hands on actually for two reasons. One is that I am 1200 miles away and 2 is that I am a novice. I think I will stand back and watch how things play out and ask questions here as they arise.

Short term rentals. there is a property management group on site that handles the short term rentals. They do take 45% of the rental income but they handle everything four us. This makes it a hands off operation for us. Again, for a first venture I thought this best.

Thanks guys. While we may well have not caught the market at its lowest point we are fairly confident that we will make money on our 7 to 8 year time line. As we all know timing the market exactly is impossible and we felt it was "close enough" to the bottom of the arc to warrant buying now. Did I mention I now have a place to stay when I go golfing??? We look forward to the experience and the learning curve that will no doubt come with it.

So we decided to give this a go with a low cost investment and bought an oceanfront condo/hotel in Myrtle Beach. We picked it up on forclosure from the bank for a little less than half of what the original owner paid 6 years ago. The rental income from last year minus the management fee will more than cover the costs if it remains constant in years to come. The final decision was made pretty easy when we visited Myrtle in July - EVERY place was full that we looked at - are you guys not in a recession?
As I have read here on several instances, you really learn by doing. If this in fact works out as well as I hope, it will perhaps be time to pick up another property in Myrtle when I review my position in a years time. If I crash and burn, all is not lost - and I have a place to stay when I go down to Myrtle to golf. This is going to be interesting if nothing else. Now to get my ITIN number..... :roll:

Hi, I am hoping you can help me out here. I am new to this game - very new. We have a Townhouse in Toronto that we have owned for a couple of years. It was recently appraised at 300,000 and we have a mortgage on it for 130,000 with 8 years remaining on the term at 5.25%. My WEEKLY payment as determined at the start of this Mortgage was 213 and I am presently paying 425 per week. At this rate the mortgage will be done in 7 years from now.

So on a recent trip to Myrtle Beach to feed my golfing habit, I discovered that the majority of the "Resorts" along the grand strand were in fact Condo's that were handled by a board and rented out weekly. Well it certainly seems to me that with the sub prime mess in the states and my current financial situation it might just be the time for me to invest in one of the aforementioned condos. I checked into it and there are SEVERAL properties available to us in the 100,000 to 125,000 range that include one bedroom and efficiency condos right on the beach to 3 bedroom 2 washroom units 5 minutes from the beach all with management companies to take care of the short term rentals at costs of between 35% and 50% of the rental income generated.
I have spoke with my bank and can get the funds needed at prime (4.75) in an interest only payment with wide open repayment options. Of course prime can always go up but we really are not looking at large numbers here so even if it jumps to 6% - which I am told is not very likely it does not leave me in a bad position.
Now, I had been given the advice to check the insurance rates for ocean front properties as they had skyrocketed recently and the three places that I had checked with assured me that the insurance costs were covered in their POA fees. Those fees had ranged from anywhere from 250 to 550 of the three places I had spoke to.

As I have stated I am quite new to this and just educated myself over the weekend about the 50/50 rule. Pretty much none of the places I have been looking at down there really meet the criteria but I never really expected this to be the case upon entering this and as you can see I do have some room to be putting my own money into this.

So here is my thinking going into this. I feel that while the real estate woes may not have come down to their lowest point yet - they have got to be pretty close. I vacation in Myrtle once a year as it is so I will now be able to write off that trip since I will be checking on my property while there. I will also be able to write off the interest paid on my line of credit as well as any POA fees. I am looking at this as an 8 year plan, at the end of which I am hoping to be able to sell the property I am buying now, pay off the remaining balance I will now have on my mortgage here and upgrade my investment property in Myrtle. I will still have a mortgage for the new property in Myrtle but all of the same writeoffs will still apply. I plan to use the upgraded property as a rental unit in the summer months and as a winter home in the winter months. KEEP IN MIND THAT IN CANADA WE CAN'T WRITE OFF OUR MORTGAGE PAYMENTS LIKE YOU CAN IN THE U.S.
So now the question - am I missing anything here of is this as good of an opportunity as I have led myself to believe? We are going to Myrtle In a few weeks with checkbook in hand and I am looking for someone to play devils advocate here.