All Forum Posts by: Kevin H.

I am almost done with doing a cash out re-fi with one of my rental properties, (closing 8/2/2021). I will be receiving a significant of money that would allow me to invest in another rental property or I could do a recast and lower my monthly mortgage payment. Each has pros and cons. I am leaning towards buying another rental, however lowering my primary mortgage increases cash flow as well and paying off your home is an accomplishment, that brings peace of mind. I can not payoff my mortgage with this money, but can put a nice dent into it, which would love my monthly payment by $400-$500 a month. I would love people’s thoughts and opinions, as I feel there is no wrong answer. I do feel that buying another rental is more beneficial in the long run as real estate usually continues to increase in value and so do rents. While mortgage payments stay the same.

A potential tenant wants me to go in on half the cost of a privacy fence. The house is a duplex and their yard is located in the front yard. I wasn’t planning on installing a fence in the front yard, but see value in it, especially if someone is paying half the costs. However, due to lumber prices, fence installation is quite expensive and uncertain if I should move forward with this request. I would love peoples thoughts on what they would do.

@Joe Villeneuve

Joe thanks for the back and forth insight and feedback, at first glance your numbers don't make sense to me. I'll have to look more into it when I have time, if true and valid I understand why you would stick with REI, I think they removed this thread as it has disappeared completely form the site. I don't get those kind of returns with my current properties, but inflation will make it more affordable to own my properties and rent will increase my roi. I'm fortunate my tenants have been paying during this pandemic, but don't know if I would be able to stay afloat if 2 properties stopped paying for a year, let alone the government forbidding me from evicting them and current prices in my markets feeling extremely inflated. I'll continue to look for opportunities and will most likely continue purchasing rentals, I just feel at the moment my returns in other investment channels will outperform rei.

@Joe Villeneuve

Joe, your monthly cash flow seems a bit high, but I’ll go along with it. You’re insinuating that the home you purchased has no mortgage to it. In one year we’ll say your total investment is now 140k, mine is worth 400k, I could go and buy 4 properties now and you might be able to buy 1 by doing a re-fi. Let alone all the fees and time you will have to pay to complete that process. Also my return so far is less than 1 year of holding, I won’t say it’s never happened, but how often does a house appreciate 400% in a year? I honestly expect my investment to 10x by May. There have been a lot of good points by people and I didn’t want to go down the rabbit hole that some posts did. A lot of the information people are stating is false or not 100% about Bitcoin as things are changing so quickly. When do you stop calling an asset speculative? It’s market cap is worth over 1 trillion dollars at the moment and even though there are rumblings of possible laws or regulations, nothing is finite and if I worried about what if’s everyday I would be a miserable person. Again, I ask you joe at what point would you consider to take the money that you would normally invest in real estate and put it into another asset that has a much better yield, less maintenance and far more liquid? Yes you can factor in the risk, volatility, as I said before since it’s inception on avg it’s yearly return is over 200%, I can’t say that will continue, I do believe it will for a few more years as the industry is evolving and growing rapidly and to make this interesting and hypothetical, we’ll say for the next 5 years btc will continue to see 200% yearly returns, would you consider investing differently?

@Carlos Ptriawan

The digital dollar is no different than our current fiat system, the government can print or mint as many as they want. Until governments are held accountable and control spending, bitcoin will have no top, because fiat has no bottom. The government just approved to print 1.9 trillion, a fifth of all USD ever circulated has been printed in the last year. That why houses, stocks and other assets value are rising dramatically this past year.

@Jim K.

You make some valid points, a bit dark to say the least. The thing that you’re not grasping is that the world is trying every possible way to separate itself from the USD. It’s crumbling, old, slow and people are tired of government’s printing billions/trillions, inflating costs of goods and making their friends even wealthier. If other countries start adopting a smarter currency, the US will have to adopt it as well. I expect in the next year that you’re going to hear that large nations and FED banks have BTC on their balance sheets. India tried to ban it and reversed their decision. I don’t think you know enough about it to say the government can confiscate it, if stored on a proper device, without the seed phrase it is inaccessible. China banned it and they are the largest miners of it, other countries that banned have some of the highest usage of it. Technology changes a lot of things, people never thought the phone would work as you had letters, or cars over horses. The internet wasn’t going to make it because dial up took forever to download something. I don’t think people realize how much this technology is going to disrupt everything. You will be able to get a loan for a house through crowdfunding and avoid the bank. Your deed will be a Non Fungible Token and is visible on the blockchain. So many industries are going to get swallowed up by blockchain technology. It is most likely too big for governments to stop and now they can only regulate it, same goes with the internet, governments either try to shut it down or control it. However it is too big and there are ways around their control.

@Dan Rowley @Jim K.

Again, my main question was are people very bullish on the overall real estate market with all the laws and issues going on? In the northeast, they’re not tenant friendly, home prices have gone through the roof and taxes will continue to go up. My goal is to build wealth and rei for me was the best avenue. I am now looking for new alternatives as I don’t have a bottomless piggy bank and crypto is the best choice for me at the moment. I wanted to see if people are looking for different avenues with their money. Jim you sound way to negative, technology is coming, if you do your own research, bitcoin is can not be band as it is decentralized and no entity controls it. It could be regulated and in the short term would hurt the price, it is extremely volatile, but a lot smarter and richer people are poring millions to billions in it. The market cap is too large and too many rich and powerful people are holding it. Blockchain is the new frontier in my opinion, is btc going to be around in 10 years, idk. I do know that forms of crypto are hear to stay and will disrupt many industries, housing included, you can research why. Again it could go to $0 or $1M, idk and I didn’t say I would never get out of it, I listen, learn everyday and decide if it is still viable for me. As of right now, rei makes no sense for me where I feel comfortable putting my money. Clearly the majority of people feel differently and that’s ok.

@Joe Villeneuve

Hi Joe, I’m not part of any affiliate group, nor am I shilling specific cryptos as Bitcoin is way to main stream for me to move the needle. I will give you numbers though and pardon me if my math is wrong, as it should be close though if it is. First off you’re right blockfi isn’t fdic backed, I feel like the risk is worth it as I have done my own research and am comfortable with the risk. Let’s go into my scenario. I invested into btc in may of 2020, we’ll say after I bought, I put it into blockfi and haven’t sold. This is what my returns are:

Blockfi pays a 6% APY, monthly payout that is able to be compounded and my interest is paid out in BTC:

May 1st 2020 - purchase price: 1 BTC = $87771.57

June 1st 2020 - BTC price $9564.95: 1.005 BTC, .BTC interest = $47.82 and my total holdings = $9612.77

July 1st 2020 - BTC price $9153.95: 1.01 BTC, BTC interest = 45.77 and my total holdings = $9245.72

Aug 1st - BTC = $11354.16: 1.015 BTC, BTC interest = $56.77 and total holdings = 11582.95

Sept 1st - BTC = $11964.21: 1.02 BTC, BTC interest = $59.82 and total holdings = $12205.29

Oct 1st - BTC = $10626.6: 1.025 BTC, BTC interest = 53.13 and holdings = $10894.93

Nov 1st - BTC = 13662.97: 1.03 BTC, BTC interest = $68.81 and holdings = $14181.05

Dec 1st - BTC = $29391.78: 1.035 BTC, BTC interest = $146.96 and holdings = $30436.05

Jan 1st - BTC = $33543.77: 1.04 BTC, btc interest = $167.72 and holdings = $34909.24

Feb 1st - Btc = $45159.5: 1.045 btc, btc interest = $225.8 and holdings = $47232.8

Interest alone I’ve made $872.6 for 10 months, I accumulated.045 more btc which is now worth $2032.18 and my initial investment is up 438%. Again I’m not saying I am done with rei, I just feel at the moment if I had $100k today and was looking to invest it, real estate has too many risk and is less attractive (excessive government printing, unemployment, high housing prices, eviction moratorium’s, etc) I personally feel it would be hard for me to yield a nice return on my money and don’t want to deal with the headaches. As stated, I can put that 100k and earn 8.6% compounded yield and can borrow on it. Yes I miss out on the appreciation of the home and tax benefits, but at the moment bitcoins roi is way better than what real estate could do for me.

@Damaso Bautista

Would you consider buying more houses in the CA area if you weren’t retiring and still active? CA has been one of the hardest hit states from the pandemic and eviction moratorium. Plus home prices have skyrocketed, I don’t know the roi for homes in CA, but I would think it would be tough to find a good cash flow house, plus all the other issues in that state would make me weary.

@Damaso Bautista

You're missing my point, I'm already invested in both and not asking for permission. What I am asking is, are people thinking like this as well? Are people starting to rethink putting their money into rei and putting it into crypto. My goal in investing in real estate was to make money and I thought it was the smartest way for me to grow my wealth. You have an opportunity cost/loss, if you only could invest $1 in real estate or $1 into crypto and crypto roi is significantly outperforming real estate, why would I invest in real estate? Or would I change my investing habits and diversify my portfolio to be less heavy in rei? I no longer think REI is the best way to grow my wealth but I'm curious on if other people are starting to think the same or differently.