All Forum Posts by: Jordan Roberts

Hello,

I'm looking for some recommendations with insurance companies to choose who have solid rental umbrella policies at a reasonable price. Who do you use (those of you who have it)? How much do you get or recommend getting for the policy?  

I appreciate it in advance!

Hey guys, has anyone here worked with and bought property from Marshall Reddick found here........ 

https://www.marshallreddick.com/

If you have, how is their service and property management? They seem legit...... but want to see what the real world answer is. 

Thank you very much!

 Thanks for the reply! Ya, I'm currently looking for house-hacking opportunities, however assuming we can't get that going, I just wanted to know what would be more efficient.

Hey everyone, so I have a question that I can't exactly come up with a good reason to go with either option. My wife and I keep going back and forth on the topic and I thought I'd ask you guys for some outside opinions.

Here's our situation:

- No kids (neither of us want any either)

- Both of us are under 30 (not for long)

- We save $2k/mo and that's after paying rent of $1,500, it comes out to be $28,000/year of savings with 26 paychecks each/year

- More about savings: we save roughly 43% of our income and that's without being Nazis

- I have roughly $30k in my own savings from stock trading that I'm currently looking to re-locate into real-estate.

So here's our plan: We recently sat down and came up with a 5-10 year plan of acquiring out of state rentals (we live in California) to become financially independent with cash-flow. This 5-10  year plan DID NOT include my $30k I already have. Now that I'm looking at re-locating my money into real-estate, I'm stuck with a couple of options.

My wife and I have been going back and forth with where to put my money. What do you guys think? Is it worth purchasing our own property and building up equity during the 5-10 years it will take to acquire all these other rentals? It would take us a little bit longer to save up a 20% down-payment on a reasonably priced house ($200k+). Or should quite literally every last penny go into rentals and we also just keep renting the entire duration? Keep in mind we live in an appreciation market, not a cash-flow market, so a house we own during this time period would have a greater likelihood of appreciating enough to possibly get us another rental when we sell it. This is my argument to her. Which would be more time efficient basically using what would've been our rent checks going into equity towards another rental in the future.

Her argument to me is that renting will be cheaper in the long-run because we don't need to repair anything around the house allowing us to preserve our savings rate of $2k+/mo as well as just being easier. I mean... I can't argue that. 

Basically, we can't come up with enough of anything to convince us in either direction. What do you guys think?

Do you think owning during the period of obtaining your own rentals is a waste of money or time? Or do you think renting is a waste of mostly time? 

 

 Ok so you could easily believe that the property I was looking at could be over double the property tax of owner occupied if this guy is correct? The one I was looking at has a 2% tax rate for the area, and the website is stating that they are paying 5.1% in property taxes. The property taxes are also more than the mortgage payments. So, if this is correct,  then it sounds to me like Illinois is a no-go state for investing. 

 Ya and this home will not be owner-occupied. I'm looking to buy rental properties out of state. That's what doesn't make sense about his response. Would you like me to copy and paste his entire response? I really don't know how to respond to them other than just saying "no, that still doesn't make sense".

Now, in the email he did link me a similar house (unknown if it was a listing on their page) in the same area that showed actual property taxes being paid around that amount, I guess to prove to me that people in the area are actually paying this tax rate. Does this prove his belief that rental property taxes are treated differently than owner occupied property taxes? No, it just shows that some random person is paying an exorbitant amount of property tax in the area. 

I guess my question would be, how do I navigate this? I know they have good valued homes on their website, however should I just always be running the numbers based on the property tax assessment of "smart-asset" and not what the website is telling me? Are they giving me 5%+ property tax rates because there's something wrong with the title of the property? Is this very common? 

Hello,

So I was on Roofstock recently looking at rentals in their inventory and analyzing deals. I noticed that a lot of the property taxes listed on the homes were really high. For instance, I found a home in Illinois worth $112k requiring roughly $25k down that collected just over $1400/mo in rent and only cash-flowed $52/mo. I was puzzled why it cash-flowed so little until I noticed that they had property taxes listed at $5,800/year (just over 5%), which was higher than the mortgage every month. I went onto "smart-asset" and input the state/zipcode and it told me that property tax in that area should only be 2%. So I emailed them letting them know that something is wrong with their algorithm on the website. They replied with "I believe that property taxes for investment properties are treated differently than primary residences."

I'm new to REI and am getting close to pulling the trigger (still saving up a bit more), however I have done a lot of research into RE and have NEVER heard of rental property taxes getting treated differently. Is this true? Do these cash-flow numbers seem correct? Is this an Illinois only thing? (which I could see because they have high property taxes).

The reason $52/mo seems really low to me is because I found a turn-key property company I'm on an email list for who regularly emails me with new listings at much higher ROI's (18%+). On their spreadsheets they list the property taxes as being what is expected for those areas, surely they would mention much higher property taxes if that was true. To clarify, this turn-key property was interviewed by and given the stamp of approval by BiggerPockets (that's how I found them and why I trust them).

So something is not adding up here for me. Maybe I really am that dumb; but either Roofstock is displaying false numbers, this turn-key company is displaying false numbers or it's an Illinois state thing in which case I will not be investing there. What do you guys know about any of this? I really appreciate any responses.

Thank you very much everyone for the great responses!

Here's an example of one I found near Russian Jack park:

https://www.zillow.com/homes/for_sale/Anchorage-AK...

This one actually has a reasonable HOA of $271. What kind of neighborhood is this area? Seems to be North East.