All Forum Posts by: Kevin McGuire

@Patrick Harrington Toto is my preference as well, you’ll see them in lots of commercial installs. And to add to what others have said: don’t cheap out on the toilet, you’ll just end up spending more in plumbing bills. And headaches.

@Joe Cassandra thanks for answering the actual original post question! This sounds consistent with things he’s said in his podcast.

Oh and by the way, I like chocolate chip cookie dough ice cream. I know it’s unrelated to the original thread topic, but so is most of this thread content so I thought I’d contribute in kind.

@Darius Ogloza great points and along the lines of my reaction too. You can't compare CoC across different regions since the economics have predominantly local influence and likely appreciation changes too. Otherwise we'd all invest in Kansas City.

Here’s some questions that I’d consider:

Q: Compared to what?

3% CoC is pretty typical for the area I live in (Seattle) but investors expect appreciation. It sounds like you've done your homework and 3% is as good or better than the alternatives. Without knowing historical appreciation though I can't really evaluate the entire deal.

Q: What’s the risk adjusted?

As others have noted, the cash flow won't give you much in terms of reserves so there's risk depending on your other sources of income etc. I always factor in 3% vacancy and 3% maintenance before I calculate cap rate or CoC. If you haven't done similar, then I wouldn't take it since the risk definitely then exceeds the return.

Q: Is this the highest and best use of capital?

The other consideration is whether you can buy bigger with the same cash but higher leverage (instead of spending so much on repairs, get something more stabilized and apply all the cash for down). You’re basically at over 33% cash in. That might be the real opportunity cost especially if you’re investing for appreciation. Or, as already mentioned, refi post purchase, but that starts to feel like trying to “make the deal work” rather than find one that does.

@Everett Yates It depends on the specific HOA. The biggest risk is the reserves are funding level, since a low funded reserve is a liability which will eventually translate into special assessments or increased dues. Regarding changing rules, they're usually difficult to change, typically requiring a large percentage of votes (e.g. 80%). Check the rules for yours. The issue I usually have is not with the HOA but with the management company who can be slow to address your needs, but in practice this matters more for garden homes than apartment style buildings. The main risk I see for you is if you want to switch it to a rental and the 20% has been reached. I don't know if having a roommate counts, maybe you can request being counted as one to start. Finally, the best way to mitigate being pushed around by the HOA is to join the board.

@Cameron Chambers I’m from Ottawa, my portfolio is there, but I live in the U.S. Welcome!

@Peter T. What would “more worthwhile and advanced discussions” look like?

@Chad Ellis Wow totally my bad, I should’ve broken my post up into two different posts or clearer parts:

Post 1: Chad, agree 100%, you nailed it, that was my intention. You didn’t distract from my offer, you helped clarify it.

Post 2: WTF is going on in this thread?!

Please accept my apologies for what must’ve seemed like a rude attack on your person. It was in hindsight a poorly formulated post and thank you for pointing that out so that I could address it. 
Sincerely, Kevin

@Chad Ellis you said “level playing field”, and that indeed is my intention of offering coaching.

I don’t know if folks are still reading this far down in the thread, but here goes:

The original post asked, “What are you doing ... that effectively addresses racial disparity in home ownership?”.

Let’s say the topic question was instead, “What are you doing to address climate change?”. Why would you even bother answering, “I don’t believe in climate change.”? I mean really, why even post? It certainly doesn’t help folks who went to the thread looking for climate change solutions.

I’m not saying what you should believe, or not believe. Nor am I questioning your right to your opinion.

I’m saying that the whole purpose of the BP community, at least I thought anyway, was to be helpful. Disputing the very question is simply not helpful to those whose goal it was to seek solutions to the stated problem. Why would you go out of your way to effectively waste the time of your fellow community members? If instead you want to have a debate on whether “climate change” is real, or matters, that’s a different topic. Go start it. Instead what you’ve done is made those who came to this thread for its intended purpose to stop reading. I was frankly hoping for better from this community.

You honor me @Tim G. , thank you 

@Evan Robertson thank you for bringing up the the word “compassion”. I have to say, I find it disheartening that, in replying to a thread on “what have you done to help”, I see folks here essentially saying it’s up to the individual to pull themselves up because this is a nation of opportunity. It may be, but that opportunity is not distributed equally. The documentary “Inequality for All” on Netflix, by former U.S. Labor Secretary Robert Reich, is quite informative. I commend the hard work behind the stories of those individuals here who bettered their lives despite their circumstances, but you are not proof, because all those who could not aren’t here to post. We have selection bias in this BP community.

Here’s my offer: anyone who knows an individual of color who wants mentoring, DM me, I will donate my time. I’m not the world’s best real estate investor but I do know a few things about it and personal finance, and I’m a professional coach. I am white though, but please don’t hold that against me, I was born this way :)