All Forum Posts by: Jacob Pereira

I like @Susan M.'s response; yes, you are a business owner and you need to make sure that you are making good business decisions, but you are also a human being, and kicking out otherwise good tenants while they're already struggling with a tragedy is unkind. 

Susan's suggestion allows for a compromise agreement that still makes good business sense. We are in a human business, and sometimes it takes more than just rigid rules and numbers to run the best business.

Good luck.

Just a few weeks ago I had an appraiser look at a fourplex I'm buying and he went approximately 35% above the market rate. Even if you could be certain your appraiser is accurate it still probably wouldn't be worth the cost, but since you can't even be sure of that it's really not worth it.

@Sean Tracey I love your plan. I'm about 50-50 invested in index funds (mostly S&P matching) and RE, depending on the valuation and the day. I think your plan is a good start, but you'll probably end up doing some tweaking as numbers solidify and the path forward becomes clear. Also, as mentioned above, you may have a hard time investing only 20-30k into real estate without living in your investment in order to bring down your down payment.

Don't forget to factor in the tax advantages of investing in real estate (these vary widely depending on how you do it) and also don't forget about your rising healthcare costs over time. I'm also hoping to retire at about 40, but I haven't yet been able to figure out how to minimize my exposure to health risks enough yet (provided that medicine doesn't get socialized or something by then).

No one representing Austin yet? We've got great Universities, a strong (and growing) tech sector, and the capitol of the second biggest state in the union by population. 

I wish that I had seen this advice when I used my VA loan on my first investment property (a duplex). Your VA can be used on a property up to $417k, and your best use of that given your circumstances is most likely a three or fourplex.

From my understanding the VA loan is a bit more difficult to use on condos and other non-standard properties, but more importantly why would you use it on something that doesn't provide much return on your investment? You can use the leftover benefit on a second property after living in the first one for a given period of time, but unless you pay off the original, you can only use whatever amount of the 417k wasn't used the first time. In other words, if you buy a $200k condo, you can only buy something else with zero down for $217k, which wouldn't cover most deals in Austin (at least not ones that the VA allows).

Either way, good luck and thank you for your service.

When I listened to that podcast my ears perked up a bit too. I think that she actually just meant that you should try to get the maximum amount of discounts possible via your business. Her actual wording was a bit off, and some of her suggestions as well (I seem to recall Brandon reminding her that people were listening when she mentioned she deducted dates with her husband), but the overall advice was sound.

I also am not a tax professional, but I operate my business as a sole proprietor (with an umbrella policy, of course) and I still take deductions. My CPA has never had a problem with them. 

I just now realized that there were many more responses to this thread. Thank you everyone for your suggestions. I'm looking forward to this new chapter in my real estate investing career.

Thanks James,

I just spoke with Alan a minute ago. He seems like a very knowledgeable guy.

Can anyone recommend a good attorney to act as a trustee for a hard money loan in Austin? I'm looking to loan some money to an investor, but I need a trustee to look over the paperwork and make sure everything is on the up and up before I sign the dotted line. As is usually the case, time is of the essence. 

@Craighton Poonwelcome to BP!

I live and invest in the Austin area in residential multifamily and it has treated me very well. I am concerned that the valuations on existing properties are no longer there like they used to be, but all that means is that you have to search a little harder for a diamond in the rough than you would otherwise, and the current appreciation levels are a very nice plus. I'd definitely encourage you to look at properties here, but as many others on the site will tell you, beware of speculative investing. This market can't continue like this forever, and when the downturn happens those who made bad bets will have a tough time.

Feel free to reach out to me if you see something and you're looking for some eyes on the ground.

Jacob