All Forum Posts by: Huy N.

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That bathroom is amazing!! Great idea having the closet in there.

Huy,

I just read your post regarding the house you bought for 80k from a whole wholesaler.  Sorry, I'm pretty new to this, what is a whole wholesaler?  Also, and again, I'm new at this, why did you refinance right after you purchased and put 10k into the property?  I'm guessing because you added value to the house?  Just trying to figure everything out.  Thanks

Huy N.
Aren't you forgetting Capitol gains tax of 15% on the 50k? So that would be $7500 in taxes.

Good one.  The unmentioned key which is never talked about in buy and hold posts is:

- best appreciation happens in rentals bought in top school districts via great schools rating.

- buy cute curb appeal in nice nieghborhood.  

- If you buy in small towns like me, also deep study jobs and new jobs sources.  Only buy in the path of job increases.

Sounds like this deal did this well BECAUSE of one or more of the above was in play.  Its a necessity to know why a deal did so well so one can hope to replicate it or share with others to replicate.

Buying a cheap house in the hood will never do this well.  Rough areas don't appreciate nor attact occupant offers bidding the price up.  Only the above points will cause this to happen.

Good luck folks.

Hi Huy - Looks like a great deal. I wouldn't say it was 100% return, since you need to include your $10k renovation with the $20k down, so you had $30k (plus taxes, closing costs, etc.) wrapped up in the deal. But it certainly was a very good return.

I wouldn't second guess your instinct to sell. You happened to catch the Spring market in a huge upswing as some of the major oil companies moved their offices up into that area. However, with oil prices still way down, those companies aren't going to be doing a lot of hiring for a while, so I suspect the market has cooled for the time being. You might still find deals with good returns in that area, but I wouldn't expect such oversized huge returns on every deal... unless you wait for the right ones to come along. It's part experience knowing what you're looking at and part luck catching the right market timing.... so stay smart and stay lucky!

Let me ask you this though. If the house was worth 130k, why didn't you pull all your money out of it during the refi (i.e. 75% of 130 is 97k). If you paid 80k and put in 10k more, you were all in at 90k. Refi for 97k. Pocket 3 or 4k after closing costs and keep the house.

Then you'd have all your money back and have no money into the deal. The new mortgage would have been 650/mo? Taxes and insurance another 250/mo? So gross profit of 350/mo and no money into the deal.

Why sell?  You could do 10 of those and be in great shape....