All Forum Posts by: Matt J.

@Mark Wurtemberg hey Mark, you still doing this?

@Shaun Ng

Buy a house near campus, find a property manager to run it for you and let your kid live there. Don’t think you need to have her manage it at all.

Hey everyone, 

In the summers, I am guessing most lakeshore Air BnB's in northern Minnesota have around a 90% occupancy rate. In the winters, if there are snowmobile trails nearby, winter events in the area, things like that, what do you normally see for an occupancy rate? 

50%? 60%? 

Running the numbers on a place in the Sturgeon Lake area and with a 50% occupancy rate in the winters, doesn't seem like it would do all that well unless you owned a place free and clear. 

Update - just got an email from my property manager. They have it leased up starting September 1st to a family for $1950 a month plus all utilities. $425/month with little of my own money into the deal thanks to the construction loan and upcoming refinance. I love real estate! 

Yes it is a good problem to have, for sure! Right, if the market stayed at 245 I wouldn't even be entertaining selling. And there would be pressure for me to recycle that money fast because that's just how my brain works and that could lead me to investing in something less than stellar. 

Thanks Jeff! Like I said to Kevin, next time I'm in Duluth we should meet up. Hope all is well!

Hey Corby, 

Yup the quick profits are enticing. I have 4 long-term rentals right now and you're right. All of them have appreciated very nicely, I've realized the great tax benefits, and the cash flow is stacking up. 

Great point about looking 10 years into the future. This place could be worth twice what I paid for it with rents up quite a bit too, plus I'll have a good chunk of equity that I can leverage into more places. 

The goal is to get from 5 places now to 15 places in 2 years. 

I could, but I don't have another place lined up to buy and am thinking long-term hold is what I'm going for at this point. Maybe do a cash-out refi so I can buy another place. Thanks for the tips, Kevin! When I'm in Duluth next we'll have to get together. 

I definitely don't stick to a clearly defined IRR very well yet. So far I've been really focused on targeting a certain amount of cashflow and being happy if I achieve that. As I progress further it seems like it gets to be more and more important to understand your target and adjust as necessary, just like you said, Mike! I think a cashout refi after a year might be my best bet. I just can't justify letting a house go when they're so hard to come by right now lol. Thanks Mike!

@Michael Plante long term rental

Hey BP. Have a house we're just about finished rehabbing up Duluth way. I'm all in for around $195,000. ARV back in March when I bought it was around $245,000 but the market's appreciated a ton since then and there's some comps nearby that support as high as $275,000. Keep in mind the appraisal was done on the house prior to it being fixed up and based on the scope of work my contractor had put together.

So, if I were able to sell it for $275,000, after paying realtor fees, capital gains, and the mortgage I have on it (construction loan of $192,000), I'd clear around $50,000. '

Keeping it as a long-term rental, I would be cash flowing around $425/month. At that rate, it would take me a little under 10 years to end up earning $50,000 in profits from cashflow. 

Now, I realize the other benefits of buy and hold including debt pay down, equity buildup, tax depreciation, all that jazz. I prefer to go buy-and-hold and have never done a flip. 

But that do you all think? How do you decide whether it makes sense to keep it long term or sell it for a quick-ish profit?