All Forum Posts by: Jay C.

I like ETFs just in a taxable brokerage account. I am still saving money for rentals but I figured I would target single family homes in my area. I like the turn key model but still researching options.

So while I am game with not paying off rentals one at a time I do wonder what my ideal endgame would be. Right now I hope to acquire 5-10 rentals over a 10 year period using conventional loans to build a small portfolio. 

If/when that becomes a reality then I am not sure if I should just keep those loans indefinitely or start paying them off. For these smaller single-family homes they won't necessarily generate a ton of cash flow but combined could be used to snowball the remaining balances of the properties, starting with that first one which would have the lowest owed. I haven't done the full math on it, but at the end of that process, you would have paid for properties that cash flow better without loans. It seems like this would be a good game plan but I don't know?

Benton/Bryant does seem like a good area to invest because of the highly rated schools. I wonder what other areas people like? I think NLR above 40 tends to have some good value deals. I live in Maumelle just NW of LR which is a great area. It will be harder to find deals I imagine for newer investors but in terms of desirable areas I would argue it's one of the best areas around. West LR, Heights, Hillcrest are all great areas but again I would think hard to find deals in.

@NaDean Bowles which areas do you avoid? I would think south of 630 and NLR south of 40 are 2 areas I would avoid the most. I see a lot of deals south of 30 but I am not as familiar but it seems okay. My wife works in that area and it still seems like a C-class area but not anywhere close to what you would get in some of the rougher areas. 

@Mann Singh even if you do turn key i think you would work with a realtor and finance through a traditional loan which means you have a lot of guardrails and protections along the way. I would not just send some company a check to invest in their property.

As far as selecting a turnkey property manager i think you would do your due diligence just like anything else.

Is it harder to get a cash out refi using BRRRR than a more traditional 20% down mortgage? I want to know if lenders are more likely to finance the latter than the former.

J. Mitchell, why did you go with balloon mortgages over fixed rate?

Aaron who did you end up working with in that area?

The other thing that makes a low-interest home mortgage not bad for the average person, is that you get tax benefits like homestead credits and interest deductions.

Joe, I don't think the home is bad debt necessarily. It looks bad in one sense when you look at how much you are paying in interest per month, especially early on but then you have to weigh pre-paying a mortgage against making other investments. I have a 3.5% mortgage so instead of pre-paying to "earn" myself back 3.5% I would rather invest in real estate, ETFs, or some combination, knowing it's not hard to beat that spread. Even if I saved that money for 10 years with the expectation to pay off the mortgage in a lump sum at the end, I would still come out ahead, even including capital gains costs from the sell of securities. I will still probably not do it. What matters more than which things are paid off, is what is your total net worth. This is a recent shift in my thinking, trying to think more like a long-term investor.