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All Forum Posts by: Account Closed

Account Closed has started 2 posts and replied 9 times.

Post: Is it risky to own a debt-free rental property?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Steven Jones this is the lowest risk exposure you can have on a rental house. Anything different that sent free begins to add risk. Some dislike all of the equity, however I love being so well covered and able to weather any new conditional change of a market like that. I sleep better having zero debt.

Post: A Little Bit of Something is Better Tham a Little Bit of Nothing

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
A Piece of Something is Better Than a Piece of Nothing I see this simple concept overlooked and underappreciated……all of the time. At the office, in our homes, and at the proverbial negotiating table. How many times do we sell ourselves short by letting the desire to win on our terms get in the way of a productive and fruit full outcome? One of the fun aspects of being a real estate junkie is I get to see it all, something new happens on every deal, every time, hands down. Last week I had the pleasure of mentoring my real estate partner on a contract where the concept around a piece of something is better than a piece of nothing mattered. Let’s just say the seller of this classically beautiful house had some personal issues and experienced a bad case of seller’s remorse after signing a contract with my partner to sell his house. The time to closing was fast approaching. The circumstances were such that this poor guy went as far as to have his estranged brother and sister call and beg and plead to let their “idiot” brother out of the contract. Now why would any buyer want to do that? This was prime Grade A realty. I could unequivocally see that the renovation of this property was guaranteed to end in a $ucce$$ful (successful) outcome. Well, it got nasty fast. What do you do? Either you dig your feet in and fight the fight or be the good guy and let him out. I told my partner, “Let’s face it, neither of these answers are good and this guy has issues and can drag this out for a while. Time is money and the probability that he finds an out is actually probably pretty good. Some fights just aren’t worth the fight. I think you tell him if he wants out you need to be compensated for your time and effort and you would be willing to give him a pass. Remember, a piece of something is better than a piece of nothing.” Well after a 7 minute phone call with the seller, the seller was kindly let out of his obligation to sell his house for the modest price of $2,500. No attorneys. No egged cars. No stressful calls at 2:19am in the morning. Do you like this answer? Not really. But is it the right answer? Absolutely. Based on the facts, we had to make a decision. How much time, money, uncertainty and stress was this fight really worth; or get what I can get and go on down the road to the next deal. We make business decisions daily. We make personal decisions daily. Don’t let greed and ego own your life. Remember, a piece of something is (always) better than a piece of nothing. See you in the trenches. The Real Estate Junkie November 29, 2017

Post: Detroit

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Christian Hutchinson @ry@Ryan MacDonald

Post: Is it safe to invest in Detroit???

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Jacqueline Carrington following.... I’ve a friend who owns some property there. I also have interest. What kind of investing would you want to do? @Ryan MacDonald

Post: Are You Keeping Your Powder Dry?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Bjorik Mutize certainly. What kind of investinf do you do?

Post: Are You Keeping Your Powder Dry?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Courtney Jones it seems like great wealth can be cretaed by being able to act when others can’t. This affords the luxury.

Post: Are You Keeping Your Powder Dry?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Joseph M. I did use financing on some earlier projects. On these I didn’t fInance and I didn’t pull equity out later. I’d rather sell them than suck equity out. No one ever lost money taking profit. While I’m working the money my returns make the current tappreciation rates look weak. Selling and reworking the money during a next correction would make most sens in my humble opinion.

Post: Are You Keeping Your Powder Dry?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
@Courtney Jones it’s interesring how folks get excited about today and forget about tomorrow.

Post: Are You Keeping Your Powder Dry?

Account ClosedPosted
  • Specialist
  • San Antonio, TX
  • Posts 11
  • Votes 12
Are You Keeping Your Powder Dry? The real wealth is made/captured when markets are weak, and other investors confidence is low. The Oracle of Omaha Warren Buffett, who is regarded as one of the most successful investors of our time, is know for saying “Be fearful when others are greedy. Be greedy when others are fearful.” How’s this relates to today and me and you and investing? Let me share about how I am laughed at sometimes for playing “small ball”. How do you make any money selling a $100k property Logan? I’m the kid on the playground who everyone is secretly whispering about and laughing because I’m playing small ball, thinking small, acting small. Well here’s how. Take a look at the listing history on this little $112k house (pic below). Itnsold on MLS for $22k in 2012 & for $112k in 2018 In what appears to be an untouched condition. This is not mine but it’s a classic example of many of my properties. If you know anything about the markets most recent cycle the associated dates and prices will clearly speak volumes to you. I entered the real estate markets in 2010 - 2012, and went all in, as much as I personally could at the time. Cashing in 401k, draining all savings, every month my paycheck would go to another deal, even dumping my family members money in. I went all in. I kept a little cash pile for safety but was dumping it all into the bottomed out real estate market. All in. If I could go back I would have borrowed from everyone I knew, but this was my first stab at taking advantage of a depressed market, so I gave all that I possibly could at the time. Next time I’ll go all in and then some, but I’ve learned plenty since then. They say hind sight is twenty twenty. Id like to think I’ve done good with this approach and am also going to be ready for the next opportunity like this. Some say cash sitting and not at work is a travesty, some say it’s smart planning and preparing. I know what my choice is; Be fearful when others are greedy. Be greedy when others are fearful. One of my mentors father, an old banker always asks- Logan, are you keeping your powder dry? He is asking if I am staying prepared for the next opportunity. What's the origin of the phrase 'Keep your powder dry'? The allusion is to gunpowder which soldiers had to keep dry in order to be ready to fight when required. This means preserve your resources for a time when they are truly needed, what resources you ask? A soldier needs his gunpowder as an investor needs his cash. His ability to move on an opportunity, faster than all of the rest. Cash is his gunpowder, one of his most critical resources, it allows him to pull the trigger on a moments notice when he finds himself faced with the opportunities of a lifetime. This gunpowder advice reputedly originated with Oliver Cromwell during his campaign in Ireland. In Ballads of Ireland, 1856, Edward Hayes wrote: “There is a well-authenticated anecdote of Cromwell. On a certain occasion, when his troops were about crossing a river to attack the enemy, he concluded an address, couched in the usual fanatic terms in use among them, with these words - 'put your trust in God; but mind to keep your powder dry'." So as we watch the market shift, less disciplined investors being distracted by shinny objects, and reckless imprudent choices developing all around us, I ask one question: Are you keeping your powder dry?