All Forum Posts by: Justin Brin

I want to also add that I'm assuming I do not qualify as a real estate professional (50%+ of work on real estate and 750+ hours/year) and that the rentals are long term.

What other kind of income can I deduct with Rental Real Estate losses?

If lets say I have $50,000 paper losses from my real estate can I use it to deduct short term capital gain? What about other types of "passive income"?

From local self managing to long distance investments? How was it for you?

I know many investors invest in their local market and manage it themself. Especially there are investors that are pretty handy and can do many repairs themself.

How was it for you to switch into long distance investments and have someone else do all the managements for you?

How was the transition for you?

@Account Closed I think I should ask you for advice. How did you make $5.3M in short time. Can you teach me?

Quote from @Alecia Loveless:

@Justin Brin I have been investing for 3.75 years and have 6 buildings with 20 doors rented and a 7th building with 5 doors under rehab.

Due to an issue beyond my control I gave my 2 weeks notice at work yesterday to end my W-2 and go full time with my real estate. I have kept open the option to be able to remain as an on call employee to fill in if there are call outs or vacations which will be a nice little added bonus here and there.

I estimate that I can support myself and the monthly payments to my contractor and I should have enough money to buy 1-2 more properties that will help me be more financially secure.

Ideally I will be able to continue buying more properties to reach true financial independence over the next 3-4 years.

Sounds great!

How long did it take you to achieve financial freedom with real estate?

If you haven't reached financial freedom yet, how much longer do you think it will take?

How long usually it takes you to rent out a vacant house, from the day you are done getting it ready for the next tenant until you sign the lease?

What methods you have to speed it up?

I see some people it takes them weeks to find a tenant while some people do it in a few days.

What are your secrets to get it rent out fast?

Quote from @Patrick Goswitz:

I found a contractor I like to rehab a house I bought. Is it best for the investor to always purchase the material? I am assuming the answer is "yes" to get credit card points and prevent a contractor from charging a premium on materials. Please let me know what you do when it comes to buying materials for a flip.

At the end it is critical to have a contractor you trust and at the end you are paying for a finished product. If you are happy with the price he gives you then what you care about what percentage is going to the materials and what to his work.
You want to make it easy for the contractor and not add work for him to coordinate the material purchase with you.

Quote from @Steven S.:

I have a lot of residential market data for California and recently put this together, quite shocking!

Developer #1 & #2 are competitors who both buy projects at a 20% estimated return level. They do the same fix & flip projects, produce the same quality, in the same 6-7 month timeframe. 

Their key difference: Developer #1 buys in Q4-Q1 (October to March), Developer #2 buys in Q2-Q3 (April to September).

Who do you want to be, Developer #1 or #2?

Of course Developer #1, it's all based on the market's $/sf appreciation, which is quite cyclical in the Los Angeles area:

Developer #2 yields under 1/2 of what #1 yielded, simply due to when he decided to buy his properties:

I'll leave you with a few more Los Angeles-area overlays where you will see the same thing (the above are all for Sherman Oaks 91401):

Don't forget the last leg of the data is not fully-representative, they fill-up as transactions occur. So the market is not crashing, I made this in early October so there were barely any Q4 closes:

Do you think this applies to your market? Do you already buy during this time?

In the San Fernando Valley & West-LA, it looks like if you were Developer #1 you could have just bought the fixers in Q4-Q1, done nothing, put them on the market Q3 (listing-only MLS service or something), and make at least ~10% every time with no work done (more than enough to cover the carry). After how many years of this pattern would you bet on it?

I think there is one very important data point missing in your graphs.
When $/SF goes down it can be for two reasons. (1) Cheaper houses are being sold in Q1-Q4 while the more luxury houses are being sold in Q2-Q3. (2) The prices really go down significantly in Q1-Q4 for all properties.
In your data are including all SFH are you including high end and low end houses. Are you using the median quality houses. I think those are very important data points.
I can imagine that people that are selling nicer houses might be more organized and try selling it in the summer when they can get more for their house while owners of cheaper houses that are less organized will be trying to selling in Q4-Q1.

Definitely if you are selling your flip you want to sell it in the summer when most buyers are out there looking for houses. If you are selling in Q2-Q3 then you want to buy just enough time before then to fix it up and have it ready on time but not necessary you will get a better price in Q4-Q1. There are most likely less buyers then but also less sellers.

Do you have data of $/SF over time regarding the house condition?

@Alan Asriants I reviewed the pics and as mentioned above it's in the border of wear and tear and intentional damage. I guess a touch up paint will resolve it.

Someone with a good income and credit score can still be messy and clumsy and cause excess wear and tear.

I personally do not accept checks by mail. There is so much fraud and lost mail it's not worth it.

I only use electronic payments or direct deposits into my account.