All Forum Posts by: Jane A.

@Tyler Kastelberg

Hi Tyler, what is the typical cash on cash return in passive RE investment instruments like apartment buildings, commercial RE, RE Mutual Funds, REIT?

Thank you for sharing your expertise!

@Michael Stanley Nino

what ROI are you looking for?

An engineer's mind may need higher control over investment :)))

let's check on the scenario of independent investing: with 40K down and conventional mortgage you could get a decent quality old duplex in the good location of Midwest.  Let's say in Blue Springs, Lees Summit, Belton, Grandview, MO you could buy a duplex for 150K,  monthly cash flow 1,400.  Minus mortgage (30 years fix around 5%), taxes, insurance, property management company, maintenance, and repairs, you will end up with a few hundred dollars positive cash flow while building an equity.  Let's be optimistic and say you will end up with 4K positive cash flow for a year, which is 10% cash on cash return.  Any major problem (roof, basement, conditioner, driveway, tenant turnover, etc) may cost 5K.  So potentially you may be spending more money on deferral maintenance before you will see positive cash flow.  After you will be done with deferral maintenance in a few years you may be able to increase the rent and see a better cash flow.  After you spent more money on repairs and improvements your cash on cash return may still be below 10%.

Now compare this number with the opportunity of passive investing with a pool of other investors into the apartment building or commercial real estate.  

One more opportunity is to keep the cash and wait for the market downturn, which may be due in a few years.

Hello everybody,

how do you see the biggest risks of being a landlord and how do you manage them? 

For example, how do you decrease the liability in the case of fire?

What are other risks you are concerned about and how do you manage them?

Thx

Hello everybody,

What do you like/dislike in apps you use to manage your rentals?

What is the best for signing leases online?

Collecting rent and sharing it between different entities? 

I use StarPoint Screening for a background check and public court records and ClearNow for rent collection.  Tried Buildium, but it referred me to different platforms, it did not look very convenient.

I would like to make application process/  lease signing/rent payment easy for applicants and for me.

Zillow is on the way to build all the functionality, but they are not there yet. 

I could continue working with different applications, but one hub may be easier. 

Thx

Thank you, everybody, the common practice over here is that when tenants break the lease they do not expect the deposit back at all, but usually they leave some kind of mess behind, so they owe money anyways.  My current case was with the high-end property, good quality tenants, and a high deposit.  My investigation of law shows that I could deduct other than cleaning and damage expenses associated with breaking the lease, if I would pay the realtor to find the new tenant, probably it will be a good justification of the expense caused by breaking the lease.

Could we deduct 50% of the security deposit as a new tenant placement expense when the previous tenant breaks the lease?  or only cleaning and damage expenses?  Thx

Hello, everybody.  I have a good prospect with a section 8 voucher.  They want to pay a pet fee for 2 doggies on the top of section 8 voucher.  Could we do that? This is in KS.  Thx

@Matthew Olszak

awesome, thank you!

@Matthew Olszak thank you very much for sharing your experience, what do you think about Buildium?