All Forum Posts by: Jared Romaine

Thank you @Allyssa Compton the advise is great and appreciated.  I have the "luxury" of having both of my parents as local Real Estate brokers so they have been helpful in guiding me along the way.  Sometimes I feel an outside perspective is helpful though - perhaps they're a bit optimistic with a family member's property.

I agree that a review of my long term goals will help to guide the decision.  My current goal is exactly what you mention - learn as much as possible with a low barrier to entry - so I do lean towards renting it in the short term.  Thanks again!

Thank you for the replies so far!

@Dave Friedman - I have put together a spreadsheet to calculate cash flow. Assuming 5% for vacancy, 5% for repairs and 5% for CapEx I would have a -$105/mo cash flow. If I add 10% for property management I'd be around -$275/mo. With that said, I plan to manage it myself in the short term, I believe the real vacancy rate may be closer to 2%, and there are no short term needs for CapEx. So real cash flow for the first few years will be between $0 and -$100/mo.

@Ozzy Sirimsi - Thanks for the input.  I lean that way as well.  While appreciation is never a certainty the market has been warming up and median sales prices are rising.  Vacancy rate should be quite low as well.  Good point with the REA commission, that's a big reason I lean towards holding for a while, if I sold now I'd barely do better than break even.

Hi all,

I'm a true newbie from Orange County, New York.  My path here seems quite similar to many - stumbling upon and reading Rich Dad, Poor Dad and I've been a regular viewer of Dave Ramsey's YouTube channel.  As a result, I've decided I need to eliminate consumer debt and start investing in real estate.

I currently own and live in a 3 BR, 1.5 BA home that has become a bit too small for our family of 4.  We now have an accepted offer on a larger home and we have the option to either sell our current home or rent it out.  Here are the financial details:

Current home value ~$200k

Current loan payoff amount ~$170k

Current mortgage (prinicipal, interest, taxes, insurance) $1,550/mo

Estimated rent $1,700/mo (tenants pay for all utilities)

So here's my question:  Do I try to sell my current home and get a modest amount of cash or do I hold the property and rent it?  Once I factor in vacancies, repairs, capex, etc. I expect I would actually have a small negative cash flow.  Obviously that's not attractive, but it would give me the opportunity to learn what it's like to be a landlord, with the hope that in a few years I could sell for a higher price with a lower loan payoff amount.

If it were you, would you take the modest cash-out now and use it to kickstart your savings to target a first rental property that will cash flow on day 1?  Or would you hold the property for 2-3 years, learn "the ropes" of being a landlord, and hope to sell with more cash in your pocket?

If I'm missing anything obvious feel free to point that out as well.  Thank you all in advance for even reading the post.  If you have some wisdom to share please feel free.  :)

-- Jared

Thanks for the prompt response Wayne.

Hi fellow BP forum members!  I'm new to the forum but I've been listening to the podcasts for several months and reading every real estate book I can get my hands on.  My question is regarding foreclosure auctions.  

I live in New York and I have identified a home that I am interested in purchasing as my primary residence.  It is currently scheduled to go to foreclosure auction at the county courthouse on February 8.  From the research I've done, I'm betting that the amount owed to the bank is much higher than the current value of the home.  I have also located and spoken to the current owner who informed me  that he left the house 2 years ago and has not been in contact with the bank.  As a result, I anticipate that the auction will not be cancelled or delayed and that the bank (Wells Fargo in this case) will own the property at the end of the auction.

My question is this:  Does a representative for the bank or the bank's attorney attend the auction in person? If so, has anyone had experience talking with that person after the auction has ended to see if the bank would be willing to work directly with you on a deal for the property?  It would save them some time and possibly some realtor fees.

Any feedback is greatly appreciated.