All Forum Posts by: Mark Weins

After the seller signs a contract to me do I send the title company the deposit or to the seller directly through e-transfer or something?

Say i buy land in seattle with a house on it but the lot is big enough to build a DADU, if it cost 100k to build the DADU and I can sell it for 500k, and build it in a year, I could make 400k in profit every year by doing one deal. Does anyone have experience building DADU's in seattle who can answer this question? What is the profitability like when you build a DADU

Hello I am currently looking through a tax lien list for a local county. I see some addresses listed for IRS tax lien properties but have no idea how to get the contact phone numbers for these places so I can contact the owner. Does anyone know of any free skip tracing services where I can find the owner's telephone number by entering their house address?

I'm looking for some insight to find the most profitable niche for a real estate business to invest into. I believe that if I am going to invest the time and work to learn real estate I should find the most profitable niche as I want the highest payout for my work as possible. I've researched some methods like BRRRR, buying other peoples syndication at a discount, wholesaling, etc..... Ideally what niche in your own experience is the most profitable compared to other real estate investing methods which can be scaled to millions of dollars of yearly revenue?

If properties double in value every 5 years or appreciate by 8-10% if it's the right area do property values just go up infinitely? If a house in Seattle is worth 2M in 2023 and is only 2000 square feet in a good neighbourhood, will it's value go up by 300% in 30 years? I feel a house with it's size limitations and what it is should have certain limits for the maximum price it can appreciate to. Would a property like this be worth 8M in 2053? I feel like that price would make no sense and the value of the property would be capped at 4M or an earlier point and not be able to appreciate anymore. This is coming from the perspective of an investor.

Is the best way to passively grow your real estate value to move houses every 6 years? Say you want to buy a home for your family and live there but also want to utilize leverage to make profit by selling the home, trading up, and moving to a new one in your local neighbourhood every 6 years. Assuming you buy your first home when your child is born at age 0, you will have 4 houses before they are independent and can live by themselves (I set the age conservatively at 24). If you live in an area with high yearly appreciation like Seattle and we assume you can get 8% yearly appreciation, here would be the following math for this idea for 30 year mortgages at 6.6% interest :

1st house 500k, value after appreciation from 6 years = 740k, profit = 60k, down payment=100k, monthly payment= 2.5k

2nd house 1M, value after appreciation from 6 years = 1.48M, profit = 110k, total profit = 170k, down payment= 200k, monthly payment= 5.1k

3rd house 2M, value after appreciation from 6 years = 2.96M, profit = 240k, total profit = 410k, down payment= 400k, monthly payment= 10k

4th house 3M, value after appreciation from 6 years = 4.44M, profit = 320k, total profit = 730k, down payment= 600k, monthly payment= 15k

By doing this you can afford houses that you normally couldn't afford through passive income by constantly trading up houses and utilizing leverage to not only live in your house and keep upgrading, but you can also use the profits from selling the house to invest or as a down payment for the next house. This is assuming you have a stable income from a high paying field like tech with household income scaling between 100-550k per year which is possible if you have a wife with a high paying job as well. For further comparison without doing this idea, you would need to make 720k a year to afford the 3 million dollar house on top of having to pay a 20% downpayment out of pocket as well. Doing this idea you would make 730k simply by living and upgrading your home every 6 years (Yes it's a pain in the ***), and each house down the line would contribute to your down payment for the next house. 

For comparison assuming you wanted to make 730k through investing in the S&P 500 index in 24 years at 8% annual returns, you would have to contribute 6k per year to get this amount. You could easily sell the house once your kids are independent and move to a 500k house, and have 200k to spend for your retirement. The only caveat is you have to move 4 times while you have a family but you get to keep upgrading while being payed to do so as long as you keep reinvesting in a high appreciation or hot area. This would work even better if you could secure higher appreciation through finding fixer uppers and rehabbing them.

If you own a standard 1M home and don't move for 24 years, you would get 192% appreciation which is 1.92M when you sell the home and assuming you payed a 200k down payment and had 6.6% interest, you would pay 1.85M in total for the loan and cost of the house and make 70k for living in your home for 30 years. That is not a good deal

Is my math right for this idea?

TLDR: If you are a high earner, upgrading and re-investing into a new home frequently generates sizeable profits that pay off your next home down payment and can contribute 700k to your retirement for 24 years of ownership.

Any mortgage experts in here?

If you buy a house today that you intend to live in with your family for the next 10-20 years would you be wasting your money if you bought a house in a (i'm going to use the terminology broke area) where the yearly appreciation for houses is either low or non existent? I am talking about houses in bad markets or poorer states like Michigan or Ohio where the economy is declining as well. I did some calculations and if you were to buy a $500,000 house with 20% down payment of $100,000 on a 30 year mortgage at 6.6% interest, you would pay a total of $1,020,000 ($520,000 interest) for that home in 30 years which is 100% of the value of the house. This means if you buy in a poor area you would be paying 920k + your down payment for your house in 30 years not including HOA and maintenance/repairs/renovations which would easily amount to over a million making your home essentially a money pit that does not grow in value if you don't buy a property with good appreciation.

If you shorten the timeframe to a 15 year mortgage, you would have a better interest rate at 6% and pay only $210,000 in interest instead bringing the total cost of the home to $710,000. That's almost a 30% improvement in price. At this point I don't get the advice that your home should be up to 5x your annual salary as if you do that you will almost certainly need a 30 year loan which will be hard to pay off early. The best strategy for buying a home seems to be to buy in an area with high appreciation and probably much more affordable (and low budget) based on my income and MOST IMPORTANTLY to be able to pay it off as quickly as possible in a 15 year mortgage rather then 30, that way I can save almost 20k a year on my home and when I sell it after it appreciates I will end up with more money as well.

I know the average yearly appreciation rate for homes is 3.5%, that means for 15 years and 30 years of ownership you would have 52.5% and 105% home value increase if you bought in one of these areas which would not give you much profit after selling the house and paying the mortgage + interest for owning the property if you intend to live in it. You would just have your equity.

If you bought in a hot area like Seattle instead where the average home value increased by almost 10% between 2021 and 2022, it makes alot more sense to buy and live in areas like this where 15 years of owning a property would get you 150% value increase which would technically give you 500k in profit when selling the house on top of an extra 300k from saved cash through paying off the mortgage faster. Am I right about all of this?

TLDR: Buy in hot markets and payoff mortgage faster or you will not make money when you sell your house

If I was retiring with 5 million dollars in the bank, and I could only invest all my money into either stocks or a real estate portfolio, I fail to see how one would decide to invest the money into real estate. The S&P 500 index can average 10% returns per year on average with 0 work involved, while owning real estate/rentals is an active business.

Owning 5 million dollars of real estate from what i've researched, you can make 250k a year from rental income, unless you get 5% appreciation on property value per year (assuming you have 20% equity and a 25 million dollar portfolio) then you would earn 1.5 mill in yearly property value increase + 250k rentals.

Assuming I am retired and the RE rentals are my only source of income would the 4% yearly depreciation (1 mill for 25 mill portfolio) mean that I avoid getting taxed entirely if my rental earnings + selling properties is equal to under 1million dollars?

If this scenario is true then investing in stocks I would make 500k per year, but with real estate I would make 250k a year through rental income, 1.5 million each year in property appreciation, and have untaxed income for anything under 1 million dollars a year.

Is this true?

Stock market gains average 8% per year. I am not sure what the average year on year return for BRRRR is but if you compare the two which one would earn you more money for your investment assuming average BRRRR results over a period of 30 years?

Hi,

I am looking to close my first wholesale deal, I have the property under contract for 110k and the listing price was 135k. Under this price would this represent a good deal to my cash buyer if they can make 15k profit from this deal themselves? Would you take it?