All Forum Posts by: Mariah Jeffery

The bank accepted my offer, but the inspection report was not satisfactory. There was evidence of flooding. I gave the bank the option to reduce the purchase price by $20K but they chose to cancel the contract. I will submit a bid $20K lower if this is still listed in a month. The saga continues...

Most of them had tenants in them already, although they had deferred maintenance so I usually waited until the first turn-over, fixed them up, and raised the rent.

The last set of 4 single families I bought had only one with a tenant. One was ready to rent and the other two needed serious work to get them ready. My team is still working on the last one and we have not found renters for any of the new ones yet.

I'm not funding them all through my local credit union.

I think you have to be prepared to buy when the deals come up. I bought my first rental in March '07 and then waited patiently until Sept. '09 until I found another deal, then another and another in rapid succession. I had 2 rental units in the beginning of 9/09, then by 3/10 I had 19. I just kept finding good deals and I was closing on a property every month. From 4/10 until about a month ago I just couldn't find anything worth buying or I got outbid on everything I was interested in. Finally, 8 months later I found and closed on my best deal yet, 4 single families in a package. Yes, you can get in over your head but as long as you have a plan and a good team in place, you'll be fine.

The elusive 6-plex was finally listed this morning for $159.9K. I offered the asking price, in cash, with a $1K earnest deposit. Bank (seller) countered back with the same price and 10% earnest deposit, plus closing within 2 weeks. I countered back with same price and $5K earnest deposit. Bank claims they won't take less than 5% ($8K). I've never heard of such high earnest deposits. I think I'm going to accept and finally get this one.

I bought it strictly to use as a rental so I'm pretty much SOL there. I really would rather leave it off of my tax return for 2010 just because of the hassle, but I don't think I can legally.

The property taxes ended up working out nicely. They are about $6,300/year for all 4 houses. Since they are paid in arrears, the seller owned me a credit of ~$6,250 at closing. That significantly reduced my upfront costs, and now I have to pay half of that in April and half in October.

Ditto. I stick with what I know.

We ended up closing and settling on 12/30 because the title co. was closed on 12/31. I received $51 in rent for 2010.

I haven't ever attended a local NWREI meeting. It's interesting that you've heard negative things about them. I've attended a meeting of the "RE Mastermind" club on Meetup.com, and found it was essentially a recruiting tool for an overpriced RE course that the members try to refer you to, so they can earn a referral bonus to pay off their debt from their bad deals that they undertook as a result of the training they overpaid for. But I digress... If you do attend the meeting, please let me know how it goes.

A lot of people invest in RE because they hate their jobs and want to be their own boss, but I love my job. I just hate the taxes I pay, which end up taking over 1/3 of my paycheck between federal, state, and FICA taxes. Being W2 slaves, my husband and I don't have many opportunities for tax deductions outside of RE. On the other hand, too many so called investors shoot themselves in the foot by buying something that actually loses money so they can save on taxes. The key is to buy something with positive cash flow that you can show to be a loss on your taxes due to depreciation and phantom losses.

More than half of my family's net worth is in RE and I only see that increasing if we continue to buy properties. I don't see any problem with this # being 60-80%; however, what worries me a little is that it's all in residential rentals in one area of one fairly small town. This particular town has a great rental market now and only a 4.2% unemployment rate. However, if something were to happen to this town (a major employer goes out of business, for example) that would significantly hurt the rental market.

On the other hand, I've invested her for a reason. I have a team in place here, my husband and I know the area well, and it's easier than most places to find good cash flow. We invest in RE part-time and have full-time jobs, so we don't have the time to do the due diligence to find a new area to invest.

Overall, I think we're better off continuing to buy property here as long as it's cheap enough. We buy conservatively so we should be ok unless the most doomsday of scenarios occurs. I do have to stop and think about whether we're going overboard at times.