All Forum Posts by: Mark Broadway

 Gotcha.  I'd still need to consider the cashflow of the new opportunity.  In my area, cash on cash returns have gone from 10-12% to 8% with increased prices and increased rents.  It's a crazy time.

Investment Info:

Other buy & hold investment.

Sale price: $250,000

5 acres + of commercial land in Branson Meadows commercial development in Branson Mo. Land suitable for retail, multi family, 55+ community etc. Sight and Sound Theater, Branson Bank and other shopping and entertainment is nearby.

What made you interested in investing in this type of deal?

Growth in Branson and the growth of retirement of baby boomers looking for places to live and enjoy

How did you find this deal and how did you negotiate it?

Part of a larger deal done 20 years ago

How did you finance this deal?

Cash

How did you add value to the deal?

Comps in the area

if you fix up and sell, can you purchase with a reasonable price where it still cashflows like this one?  In Cali, I'd think that should be considered very seriously.

I suppose it depends on a persons circumstances and how much a 'lump sum' really is.  But here's what I'd consider.  The stock market is risky; not insured, can only leverage 50%, can go to 0 in value and the money is in control of someone other than yourself.  With real estate, you should get conservatively 5-12% return on investment.  It's insured on catastrophic loss; fire, tornado, etc.  It can appreciate in value and also decrease in value but likely would never be worth 0.  It can be leveraged realistically 80% or maybe more.  Will always be in demand and can be improved in value.  So, if I were to have a substantial amount of money and didn't need to be spent but invested; my money goes to real estate and income producing property.

As an agent, I would want my buyer to have the best deal possible.  Above all, it MUST cashflow for the buyer.  Some buyers want equity to build for bigger and better things in the future, some want to put cahs in for a 'safe investment' to earn better than stock but not super risky.  All that said, if you do a turnkey, and over improve the property for the area, it won't sell.  However, if your in an area where rents and prices are increasing substantially and improve the property to where it's still average for the area with room for appreciation, then possibly.  Just a lot of variables to consider.  Overall, I wouldn't recommend that to my client.

Thank you all for your responses. Always find it interesting the answers everyone has. They are generally all right and based on experience and risk appetite. Why I love this business cause it depends on market, rents, rates. Thank you again all.

A recent video posted talked about analyzing rental property. Basically, $100-$200 after ALL expenses, a cash on cash return, and IRR. Realizing you can't just use one exclusively, how do you look at rentals when leveraging 100%? Additionally, when it references ALL expenses, what specific expenses are considered? Reserves? Maintenance? I realize taxes, insurance and mortgage and any utilities if any. Thank you for this forum. I believe I know the answer but wanted to make sure I considered everything.

This is a fantastic story and about as simple and safe as you can get as an investor.  You gotta have a place to live and might as well have someone help you pay for it while you build up your nest egg to be ready to invest in other properties.  Very great way to get your financial future going.  Thanks for sharing.

I have my LLC set up with my wife and I being managing members owning 2% and my son's as limited members owning 98% of the business. I am considering making a change where I take my wife off but keep my son's and add her later. As long as she is not active in the business, take a salary from that, would that protect her liability for any future purchases? I believe the short answer is yes but because she is on there currently, I did not know if because she is on there now, if that would have any impact. Thank you for any input.

Welcome to you!  I am in Southwest Missouri so I may not be much help but I also just joined recently and never posted anything before.  Don't have a clue what I'm doing.  If I can help in this area, let me know.