All Forum Posts by: Luke Terry

Syndications I’ve seen and been apart of from experienced syndicators will offer 20% returns over 5 years. So your wealthy friend can likely find better deals from more experienced syndicators elsewhere. Having said that, it doesn’t hurt to ask and he may be willing to roll with you. Best of luck

Originally posted by @Uriah D.:

Luke Terry I don’t have any other app recommendations, however several good podcasts are out there depending on which direction in RE you want to go. Nothing beats BP

Hi Uriah, what podcasts do you listen to?  I enjoy listening to a few others besides BP (the Real Estate Guys, Old Capital Podcast, and The Life Time Cashflow Through Real Estate Investing) and am always open to more recommendations.

Hey folks, I just downloaded the BP app for while I’m on the go. What other real estate investment apps do you get the most use out of and why?

I hear you there.  We recently moved from Los Angeles to the Cleveland area.  It's a totally different ball game in most of California.

Originally posted by @Account Closed:

@Luke Terry

What Grant says makes sense but not for everyone. I think the biggest factor is the market you live in. I don't like how he makes it a black and white issue. If I lived in Ohio I would definitely buy. Like you said buying is cheaper on a monthly basis. Also, the properties are cheaper so the amount of capital you have to sink into it is much less.

Where I live I will never purchase a home, regardless if I can afford it or not. The average 3 bedroom 2 bath in my area is $800,000-$1,000,000. The mortgage on that home after 20% down is roughly $4,500. I can rent the same home for $3,000-$3,500.

The difference between the mortgage and the rent is not even the primary reason not to buy. It's the lost opportunity cost on the $200,000 down payment. How many rentals can I buy with $200,000? Probably enough to cover the rent on the house.... It's a waste of capital. Cardone's advise works for me, but everyone should look at their their own situation and decide.

Hi Phil,

I used a self directed IRA for one of my investments. It works well.

A couple things I learned through the process - 

• You typically can't use a 401K linked to your current employer. However, any funds you've transferred from a previous employer to your current employer can also be transferred to a self directed IRA
• I used IRA Services Trust Company for my self directed IRA and they seem to have reasonable rates. There's lots of other companies to choose from too and I'd be curious to hear what others recommend
• There are penalties for pulling investments out of your self directed IRA before retirement age
• There's typically an annual fee associated with opening and maintaining one of these accounts, as well as a minimum holding required in the account

I'm curious if others have any experiences different than this.

Cheers

I enjoyed episode 250.  Congrats guys on making it.

I think Grant had some good content to challenge my paradigm on investment strategy.  However, his view on not buying houses doesn't make sense for the following reason (I know he's echoing something Robert Kiyosaki said as well so I'm countering some credible voices).

Anyway, it costs more to rent an equivalent home than what you would buy.  In addition, you're accumulating equity while paying off your house if you buy.  So his argument that the equity you have in your home could have been used for another cash producing investment isn't completely true.

Case in point, Let's say you buy a $300K home, so you're out the $70K in down payment and closing costs.  So it's true that is money you can be using for an investment.  On the other hand, your P&I + insurance + taxes for your home is probably at $1,900/ month, whereas for an equivalent home to rent you're looking at $2,500/month +, a difference of $600/month.  Over the course of 5 years, that's $36K in rent savings + $30K in equity you've paid into you home which nets you at about even.

So a better answer is if you want to like the sexy life style and move around every year or two, then he's right, you shouldn't buy, but if you plan to stay somewhere longer because you have a regular job, etc. then there's a breakeven point where it makes sense to buy, especially when you add in other benefits like being able to draw a line of equity on your house and tax write offs on mortgage interest.

Trulia has a great tool to calculate the break even point between rent vs buy on any property.

https://www.trulia.com/rent_vs_buy/

I'm curious to know what others think.   Cheers

https://www.biggerpockets.com/renewsblog/biggerpoc...

I have 2 SFH homes in the area for a few years and have used All Star Properties and have been happy with them. http://aspmidaho.com/

Hello, I'm new to the Cleveland area and plan to reach out to local mortgage lenders.  What benefits do you see from using local lenders?  What questions should I be asking to make sure I take advantage of their potential expertise in the local market?

I'm new to the area and planning on contacting them this week to get a better understanding of the market and how they can help connect me with lenders and property managers as well as properties.  I'll keep you posted on how it goes.

Great Guide James.  Thanks!  I'm new to the area and this was a helpful overview.

Originally posted by @James Wise:

Originally posted by @Tracy Saiki:

Hello Cleveland Investors and RE Professionals! I'm a California-based investor and real estate lawyer interested in testing some Midwest markets this year. Cleveland is on my short-list. Basically, my goal would be working with a broker who can find distressed properties with good buy-and-hold potential (somewhat under ARV, but not crazy cheap), then connect me with a project manager and contractor to supervise the work. Goal would be to buy for cash, then do deferred financing. In CA, my realtor is also a property manager and investor, so I know he won't lead me into a property that he doesn't think is manageable. Interested in any local feedback on whether that's doable from out of state or referrals to team members or potential partners who might be a fit. I have looked at turnkey as a potential option, but I like a bit more interaction than it allows. Thanks in advance for any feedback, or alternative ideas!

 Totally doable plan. For some more info on the Cleveland market check out The Ultimate Guide to Grading Cleveland Neighborhoods.