All Forum Posts by: Gordon Starr

I looked all over the greater Dayton area before going all in to the northern part of zip 45405 in 2012-2015. I love the construction quality and architecture of this mid-century modern era neighborhood (1920-1970). Lots of really pretty and high quality construction smaller homes. There is fantastic cash flow and the area is breaking out over 50k for a decent sf rental home. Nowadays, the area is C/C+/B- which varies from block to block and north to south. Figure 70k for an all fixed up sf that will rent for around 850 per month and taxes around 100. Like a lot of C class neighborhoods in Ohio, this area is highly de-leveraged. But this breakout over 50 means a lot of non-cash buyers are moving in. Look 5 times as many sales in the last six month as there are places remaining for sale. I predict it is going to go a lot higher!

Good luck

https://www.zillow.com/homes/for_sale/6m_days/glob...

The government gets in the housing market by heavily influencing the supply of money and the interest rate. They calculate a cost of living index and try to keep it inflating at 2-3% per year. The housing component of their index is based on what people perceive they could rent their house for. Pretty damn obscure in my view, but they are trying to control rents in aggregate.

Their policy has really very little to do with the cost of homes. It is, in my view, lame because they also influence the cost of buying a home. In recent years they made money both highly available and low interest just to keep rents inflating. They definitely don't want rents skyrocketing like they have been, so look for a lot of tightening until the rents stabilize.

This may control rent, but it really messes up real estate values which get hurt badly by fiscal tightening. Unless wages and employment go up, its a bust in home values, especially in areas and asset classes that are highly leveraged and low yield. My advice - don't buy that McMansion regardless of what the wife wants!

I've been through this kind of hard start of RE professional and having a few producing sure makes it worth the effort. You learn so much of value. If you are like I was, you can now start hiring tradesmen weekend warriors to help grunt it out. If you go get everything they need to work, they love to make cash on weekends. Just rehab one day per week, but bring in a few tradesmen and you be the boss! Don't forget - take a vacation when the first rent check is in the bank!

I found this quad on MLS. The neighborhood is underappreciated. Its about to pop. Move in one unit while you rehab the others and you could make yourself rich on that kind of return. You would probably want a dog, though...

https://www.realtor.com/realestateandhomes-detail/...

Tom posts often on BP and the things he says make sense. If they were screwing people, I suspect they would get negative feedback and I haven't seen that.

Their turnkey model has everything done by the same company. That's really easy for you as an investor. To me that is like putting all your eggs in one basket then handing the basket to someone who eats eggs. Too many crossed purposes for my liking... Everything from the sale price to the turnover frequency - they make more money when you make less money. If you were doing that in Dayton, OH, you would get slaughtered. Cleveland is a different place with better players.

I won't miss LeBron for the same reason I don't miss hot rod Williams. Hint: Its the reason hot rod was thrown out of college.

My places are from the mid century modern era and the 1960's has a strong retro appeal. Folks really go for that look both tenants and buyers. I polish and repaint, pay attention to curb appeal and all those things that bring in great tenants. If it lasted 50-60 years and it is still good enough today, you would not be improving things by putting in new stuff with a planned failure/obsolescence built into the manufacture in 5 years. It would be like replacing a good slate roof with shingle.. You didn't improve it.. That's my philosophy and it pays off.

I am tickled this thread sprung to life. So many great thoughts and information. I particularly like the idea of getting a Roth IRA going for the kids. Also all these tax benefits!

Its really heartening to look down and see the kids right there. Growing up on a farm, I was always willing to pitch in. I liked being with dad even though it was rough. Would have missed out on that otherwise. I left out on my own with powerful sinews and enough money and wisdom to make my way in life! 

Hey everyone,

I am a sole proprietor with a steadily expanding buy and hold portfolio. My kids are age 8 (son) and 10 (daughter). As a single dad with sole custody, the kids have always tagged along in some way - sometimes looking over my shoulder at the computer, sometimes riding along to look at property. Up till now they haven't done much actual work, but they are learning a tremendous amount of valuable skills. As everyone grows, the kids would like to make money and I would like to pay them. Thanks in advance if you have any thoughts on this subject. How best should I pay them? How much? What could we do that is legal and right? Has anyone else experience hiring their children?

All the best, Gordon

Here is my suggestion, its what I did with my first deal: I would research and look for a place that had the right combination of big enough for your entire family, distressed (but fixable), and move into it while rehabbing it yourself. If you are accustomed to a dorm room, this style living may not be too bad for you. Learn how to repair, paint, landscape. Look into carving it up into an inlaw apartment if zoning allows you. Then rent that part out, maybe to family or someone you can trust. That can be so much work you won't need a job for quite awhile and you would learn so much useful stuff for a career in real estate. Sweat equity is great to have! Good luck, the future is wide open for you to navigate.

Hey Matt,

My own view is that suburban B neighborhoods will see the most selling pressure and possibly a slow motion train wreck over the next decade as boomers die. Other than boomers, who has the money for all those oversized, poorly built, overpriced, overleveraged, piddling cash flow homes/investments?

I think the opposite is true of inner city C neighborhoods - especially the more decent C+ deleveraged ones where homes go for under 50 k and just recently broke out over 50k for a fixed up places. That's a key threshold where many banks start lending. These you find here in Ohio, particularly Cleveland, Dayton, Toledo. Anywhere else? Detroit? These areas are poised to break out big time as leverage moves back in.

Gordon