All Forum Posts by: Marc Ferguson

Hi, I would like some help in analyzing this quadruplex. I found this spreadsheet from Bigger Pockets and I made some adjustments. It now has two worksheets: first one is a dashboard and the second one is the raw numbers.

The property cost $485,000 with renting each unit for $1,594. The ROI in the first year is 22%. That just sounds too high. Thank you for any feedback. The spreadsheet does have comments enabled.

https://docs.google.com/spread...

I found this video today and I think it answers this question in great detail. How To Run The Numbers On A Rental Property Like A Professional Investor - YouTube

Hi there. I'm new to real estate investing so I'm doing a lot of reading, listening to podcasts, and checking the forums. I'd like to set proper expectations when it comes to getting out of the rat race. I plan to do a lot of creative financing so partnerships and other strategies will be something I toy with.

Question: How many properties will it take for me to get out of the rat race?

I know, it's a loaded question. Let me give some context. Let's say that my goal is to get $5,000 a month from rental properties in order to free myself from the rat race. I'm going to be conservative and expect an average of $200 in profit (after all expenses) from each property, maybe $100 profit if I'm doing a partnership. If I go with the average of that then I'm getting $150 income from each property, which means I'll need roughly 34 rental properties. 

The fact that I finally wrote out this thought shows me that there are a lot of factors and it's not so cut-and-dry. Is there a simple way to answer this question or do I simply take it one property at a time until I reach my goal? Thanks for any feedback.

 Hey Justin, I'm new so I'm not familiar with underwriting. If I remember what I've heard it's simply making an offer?! When you underwrite does it guarantee that you'll get the property?

Hey @Justin Messenger that's awesome, congrats! How was the deal process for you? Did your calculations match what you're paying for after you purchased the property? I'm new to the game, so I really appreciate that you posted actual numbers. Thank you.

Hey @Pedro Amador it's all good, man. I'm glad you were able to get some answers. I have some questions now. :) Are you looking at properties without a real estate agent? The property(ies) that you do find are they directly with the owner? It seems like you're doing everything yourself. If you work with an agent they will draw up the paperwork for you.

Hey Pedro, as you're surmising it's a contract of sorts, a letter of intent to purchase the property (something in writing). Here's a sample document, but whomever you're purchasing the property from will probably have something different drawn up by their lawyer(s). Real Estate Offer Letter Template - Free Samples & Examples (docformats.com).

Hi @Isaac Galeno. It looks like you may want to consider "creative financing" for your endeavors. I recently read Investing in Real Estate with No (and Low) Money Down – BiggerPockets Bookstore and it really opened my eyes to all the tools we could use when figuring out how to fund a project. Like the others say a partnership is one option; hard money lenders are another. If you're a military vet there are other programs to help.

Thanks fellas. I appreciate your candid feedback. @Joshua B Pruitt I think I will put a bit more effort into running the numbers on this. @Basit Siddiqi it was a mindset shift, but I recently considered real estate investing a retirement plan. Prior to being exposed to this I would have NEVER considered touching my 401(K). Now I can be persuaded.

Hi, I have a 401(K) savings plan with a previous employer valued at under $50,000. I'm wondering if I should withdraw and hold the money in my brand new real estate investment bank account or if I should continue to let it grow until I need it for a downpayment on my next property? There are plenty of penalties if/when I withdraw it. I'm unclear at what point is it worth paying the taxes on the capital gains if I'm not immediately using it.

Word-on-the-street is having money in my bank account looks good to banks when I'm looking for a loan. Does it matter that the money is just sitting there or do they want to see some activity with that account? Thanks for any advice.