All Forum Posts by: Kyle Scholnick

I know the mortgage interest and any expenses associated with the rental property are tax deductible but, is the down payment of a rental property tax deductible?

If I put $40,000 down on a rental property, can I deduct that as a business expense on my income tax?

I run into the same thing all the time. You have to realize that real estate investing I a very small world, it really is. Now, of that small world, its broken up into smaller worlds...people who flip houses, wholesale, buy and hold, lend, etc.

Many of the flippers/wholesalers don't get properties off the MLS so they aren't looking very carefully, they are busy with direct mail and other advertising to buy houses the cheapest.

So my point is buy and holders are a very small niche within a small world. And we are all spread out in different areas. So when you see a property on MLS that looks good, as long as you did a proper analysis and everything works, its a good property for you. There aren't as many people looking for exactly what you want in your area as you would think.

Just trust the numbers and do you due diligence....maybe that rental is just for you

Ramsey and Suze are for financial train wrecks. People who are absolutely clueless and don't know what they are doing, have no idea where their money goes and don't even know what a 401k is. They are great for the absolute beginners to learn the very basics of finance. Their product is not making your wealthy, its not making you poor and teaching you how to live a comfortable, safe, secure, responsible life with no risk.

Kiyosaki obviously is an entrepreneur and real estate investor, he is into making you rich (FYI, did you know he really didn't have a rich dad??)

If you want to get rich quicker, you need debt. I disagree with consumer debt is always bad. Obviously CC debt is bad with 18% IR, but if you are buying a car with 2% interest...I would rather pay minimum with the 2% IR and then invest the money I have now into something more productive. Don't think of it as consumer debt, its really arbitrage.

People who are financial disasters can't handle that, but the responsible ones looking to get wealthy, need to use this.

I hate when people talk down about Ramsey and Orman, they are excellent at what they do, but they are for a certain type of person...not people on this site. Ramsey got me started in personal finance, I learned a lot from him, but I graduated and moved on to bigger things. Because of him I paid off about 150k of my student loans. Would I have done that again? Probably not, I would have put it all in real estate, but its not the worst thing in the world not having debt, but it is the path to wealth.

When doing your due diligence, what are the top questions you would ask a turnkey provider?

When was the roof replaced? When was HVAC replaced? What type of neighborhoods do you invest in and why? etc...

What are the most important questions to ask?

you might be better off borrowing against it rather than cashing it out 

Welcome Edward, where in ocean city are you investing?

I think we all know real estate is a wonderful investment and a proven track to wealth.

But my question is: is it always the answer? I know many people on this blog are diehard real estate investors and would not even consider investing in anything else...but what about different types of investments such as 529 plans, simple indexed annuities, The stock market, your employer's retirement plan, etc...would you ever invest in these things or is real estate just always the better solution and all your money should go towards that?

I am really not looking for speeches on how great real estate is and how you get lower returns in the stock market or problems with insurance policies etc, but more of the question when is it better or is it ever better to put money in those other accounts versus always funneling every penny into real estate and real estate will take care of all your problems from paying for your children's education, to securing retirement, to estate planning, etc.

Thanks. 

I personally think we are due for one. Like everything in the economy, it runs in cycles. Real estate is usually every 8 years: 2000, 2008, 2016...

You can debate all day about it, but there are always cycles and this is what the real estate cycle appears to be

Gold was a bubble that happened a long time ago and it is a loser investment. Every sector of investments has a large bubble at some point that is completely speculative and then bursts. It happened with airline stocks in the 60s, Energy in the 70s and of course Internet and technology stocks in the 90s.

Gold is a speculative investment has no intrinsic value, it's value is purely based on the demand. As opposed to things like stocks and real estate where you have underlying people and companies that control the cash flow and although the prices are volatile the underlying value of each of those assets is based on how much revenue they collect. 

People who were invested in gold in the 70s saw their investment drop extremely quickly and sat on their money for 25 years just hoping to break even again.

And gold does not produce an income it does not produce dividends and it has no management making it more valuable overtime.

The long-term rate of return on gold even including the huge bubble is only about 5%.

You will be much better off ignoring this commodity and all commodities in general and focusing on your own real estate business or at least stocks with good management structures that will increase in value over time.

Only reason I would charge less than market rent would be to avoid hiring a property manager. One of their main purposes is to fill vacancies. But you could save a lot more and avoid paying them 12% per month of your rents, just by lowering the rent a little bit and the renters will come flocking.