All Forum Posts by: Jonathan Lyford

Jonathan Lyford has started 5 posts and replied 55 times.

Hi all, I am relatively new to REI, and looking to buy more without being foolish and taking too much risk. I am curious, what would you consider a good/safe LTV for your overall portfolio? What would you consider a good number of months worth of expenses to have as cash reserves? I know everyone's risk tolerance will vary, but just trying to get a general sense. thanks in advance! -Jon

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Hi! Another mental health professional here. I'll give you my two cents. 1) as far as the over analyzing/overthinking goes; it always helps to not just think about the downsides of doing something (buying a rental), but to think about the downsides of NOT doing something (missing out on passive income, not building wealth, becoming stagnant). There are risks on both sides, but people usually only think about risk in one direction. 2) My first rental was the townhome that I had been living in. My family moved out into a new place, and turned that one into a rental. If I had to do it over again I would have probably bought a duplex and lived in one side and rented the other, but I wasn't into real estate at that time. Good luck!

1 Vote

Hi, I think you need clarity on your investment strategy. Selling a property to buy more properties doesn't make a ton of sense to me, especially since you are losing money every time you have a transaction. If you have equity you wanted to pull out, you could always just refinance to take your equity out if you wanted to. Remember to keep some money in reserves too, as if this crisis has taught us anything, it should be to make sure there is enough in reserves for when the S*%$ hits the fan. Good luck!

3 Votes

Hi! Welcome to BP. Yes, cash out Refi would increase your mortgage payment. so why do it? 1 - it will increase your cash on cash return, as you now have less of your money invested in the deal. 2 - now that you have fixed up the property, it is possible you can rent it for more than you started at.

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Hi, 1) Why wouldn't you be able to find good tenants? You have to screen people, but there are good people around. The number of applicants is a function of the price. If the price is fair, you will be able to have enough applicants to find a good one. Yes, there is always risk that it doesn't go right. That's the risk you take in real estate, but remember the upside of real estate too. 2) if you house hacked, there would only be one mortgage. For me, the uneasy feeling of the risk of debt is mitigated if you have an emergency fund. What if you had 6 months emergency fund that would cover expenses even if it was unrented? What is you could cover the mortgage with your day job? would that change how you feel? 3) I haven't ran into any such issues so far, but like with anything, you have to weight the pros and cons. To me, the pros of being a landlord outweighs the cons, but that decision is up to you. Hope that helps

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Hi, I do 2 kinds of investing. 1) investing in S&P 500 index funds 2) real estate. Since you need the money in 4-5 years, I wouldn't put it in real estate, but the stock market is on sale right now. Big potential to make good money over the next couple years with the market being so low right now. I would keep about 3-6 months of expenses set aside as an emergency fund outside of the stock market, just in saving or money market or something. At 21 you are way ahead of the game!

2 Votes

Originally posted by @Johnoson Crutchfield:

I used to be a full time teacher and school principal. That meant giving every bit of my days to my job. Before real estate, I got paid on the 1st and 15th of each month. I was even lucky enough to have a wife who works who also got paid on the 1st and 15th of each month. This went on for about 10 years. Then I got my first rental, and I more money on the 1st of the month each month. Then I got another rental.... and I got more money on the first of the month. Then I added more rentals, and sometimes people paid late, but I got money on the first of the month. Now I've got a portfolio of rentals, and rent literally comes in every business day of the month... it's the most life changing thing I've ever experienced. Here's how real estate has changed my life.

1) I receive checks at all different times of the month.

2) I have more income coming in than ever before.

3) I pay less of a tax rate than I ever have

4) My net worth goes up literally everyday.

5) I spend more time with my kids than I ever have...

6) I get to give to things that I'm passionate about

7) I love what I do everyday.

This is not a post to brag, It is a post to motivate..... How has real estate changed your life?

That's awesome! I'm a little behind you; only have one rental so far, but hoping to add to that this year. Getting that check the first of the month is definitely the easiest money I make. Money for me has always been about security for my family. The more streams of income I have coming in, and the higher my net worth, the less likely my family will ever have to deal with any financial crisis in their lives, which I know from my own childhood can be very hard. Rentals are simply going to help me take good care of my family. Hopefully I can catch up to you :)

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Only change so far for me is that I have dramatically increased the amount of money I am putting into the stock market, since it is on sale right now ;)

1 Vote

Hi, I'll answer your question by telling you what I do. I put money every month into the S&P 500 index fund(you could easily replace this with a REIT index fund). I let it grow until a find a property I want to buy, then pull the money out and buy it. If you have left your money in the account for over a year, growth gets taxed at 15%. you already paid taxes on the money you put in, so the only tax you owe is the interest you have made in that time. All that being said, most people recommend only investing money into the stock market that you aren't touching for 5 years. If you choose to put it in the market, you have to be prepared for the possibility the market will go down, and in that case you would have been better just leaving it in the bank. Hope this helps,

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Hi, Maybe he should just grow a backbone and deal with his child who he doesn't want living with him anymore. He didn't involve you when she moved in, while involve you now? He wants you to do his dirty work? he needs to man up. If you wanted to evict because there was an unauthorized person living there I guess you could, but to me it sounds more like family drama that I would stay out of if at all possible.

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All Forum Posts by: Jonathan Lyford

Jonathan Lyford has started 5 posts and replied 55 times.

Post: Your LTV and Cash reserves

Post: FIRST INVESTMENT PROPERTY

Post: Is it a good time to sell a Rental for Cash or Hold?

Post: BRRRR: Does a cash-out refinance increase the mortgage payment?

Post: Rookie Investor Questions

Post: New To Letting My Money Work For Me

Post: How Real Estate Has Changed My Life? How about you?

Post: Has COVID stopped your business cold?

Post: Saving for my First Down Payment

Post: Rookie landlord needs advice