All Forum Posts by: Michael King

 LOL nice!

Negative cash flow to me sounds like you're running at a loss and therefore the IRS would take pity upon your soul and reward you with a tax advantage. 

In Australia, this is a concept and even a strategy known as 'negative gearing'. One day, you'll own a house that someone else has 'mostly' paid for. Weigh up the losses - either a hit right now in selling it, or a hit (with upside from the IRS) over time?

Interestingly, the whole reason I fell into rental investing was my first home in Missouri. Bought it without the wife being there, when she moved in she decided it was too small, so rather than take the hit of selling it so soon, rented it out. While it does cashflow, it's only $190 a month. 

If I could live without the $200, I would keep it. But that's me. 

Sorry to hear about this problem. I'm no expert, but do you feel you can trust the guy til 11/15 to see if he pays? You found out he lied by saying he's paid off the water bill, when in fact he's trying to get out of the bill via a bankruptcy? Have you asked him about any bankruptcy? 

On my first rental, shortly after the tenant moved in, I received a notice (from the court maybe? can't remember now) that the tenant had filed for bankruptcy. I was terrified, but just quietly waited it out and he's been my best tenant with respect to paying on time. 

You may be right on the property tax. On a 1200sf home here, I pay $2600 - $3100 annually. My home, 3200sf, is $4400 annually. I had a 2900sf house in Spring TX, it was $5-$6K. But another place I had in Montgomery TX, 3000sf, was nearly $9K. 

Not sure what's worse - high property tax or state income tax with moderate real estate tax?

I miss Texas. I miss the sun, driving topless in my Jeep, Mexican food, Shipleys...what'd I leave out?

@Andy Levin Crickets? I'm curious on this too. 

I put 20% down, yes. Traditional finance, so interest is under 5% for 30yrs. They are all in Missouri....I keep my eye on Houston stuff though. I'd love to get higher ROIs, but the buy in up here for a turnkey property is pretty high. And they are all less than 3 years old, so relatively maintenance free to boot. 

Zoe, I'd google review and yelp but leave the rest alone. Just me, but I wouldn't want to start what I would think to be a smear campaign. That said, some here have pointed out that if they are charging $350 a month in late fees, yet billing the client and not the tenant, then you are the one being screwed. And the BS about the accounting can't be switch. Oh give me a break. 

Check your lease. It probably says you have to notify them in writing with 30 days notice of terminating your contract with them. Just find another PM, even Renters Warehouse if they exist in your market. 

I'd start a new thread asking for PM recommendations where you are. I miss Texas, and I miss TexMex food!

So what y'all are saying, is that there are some people or companies working in real estate that are unscrupulous?

You got to burn that PM company, and fast. Then google review the crap out of them.

Begona, this will address the 1% rule as far as my personal circumstances. All my properties averaged $194K, with average rents of $1435. So about 0.74% with respect to the 1% rule. That said, I get a cash on cash ROI of 5.5%. That's including a PM company on 80% of my properties. I'm making money at less than the 1% rule, and I can make more if I choose to take over from the PM. My path is not a 'get rich quick' one. But, I'm making money...don't let the 1% rule scare you off. Do your numbers well, and you might be pleasantly surprised.

Every town I've lived in has had both Lowes and HD. In every town either Lowes has had great customer service, or HD has, but never both stores in the same town. I used to go where the service is if they're both about the same distance. And when they are having sales on appliances, they are always matched or a dollar different. 2 weeks ago I had a fridge delivered by Lowes to one of my rentals. The delivery guy was such an a$$hole, I'm done with that Lowes, and at least for now, I'm going to boycott all Lowes stores, and they could care less. 

It may be overpriced, especially if that town doesn't exist in that state.