All Forum Posts by: Martin L.

Sometimes a lamb gets lost along the way, but we are always here to welcome them back to the Dark Si.... er.... back to the fold...

@Shanae Williams at the end of the day, I just try to remember one thing. Not small reasons, not post it notes, not the "next high" of a successful deal. If you find it hard to get motivated you just need to remember.  It's not a job, it's not work... It's your LIFE. If you're happy with where you are, then you can sit back, 10x a nap like Steve was doing at one point. But if you still want to change your life, then YOU need to CHANGE it. Each step you take along the road, each minute you spend researching, writing an offer, driving around neighborhoods is a step you're taking towards a better life. Money shouldn't be the only goal, it won't buy you happiness. If money bought happiness, then the rich, famous, or rich and famous would never commit suicide, but they do. But if lack of money is holding you back from your own personal FREEDOM... Only you can change that. If you choose to.

 I'm all for Vegas, and Sam makes a good point about being "closer", but I recommend against condos, at least in Vegas. I looked at a ton of condos early on, and not a single one of them made sense, even near the floor of the downturn.  The reason? You could get a great deal on the condo itself, but the management fees in Vegas are ridiculous and eat away any potential profit or even driving you into negative cash flow in some cases. If you can make the numbers work, then by all means but I didn't find a single good prospect. I'd personally love to do multis in Vegas, but they're extremely rare and all the ones in the Southwest are older than I am.  My body is already breaking down, so I don't trust a building, that probably hasn't been treated well, that is older than I am!

Another thing to keep in mind is... people are ALWAYS prophesying the apocalypse. That's not to say it won't happen, but if you listen to the naysayers, you will literally never get started. I've been looking at investing in Asia for the past 12 years. When I first started looking, people were saying that cities like Shanghai were already in a bubble and there would be an impending real estate apocalypse, the economy should collapse any day, all the puppies and kittens would leap into the rivers and drown themselves, and general doom and gloom. Well... 12 years later, some of the properties I was looking at have increased 10x OR MORE. Properties that were about $100,000 are now worth over a million. The market has slowed down a few times during this period, even had a few small dips, but it has never really stopped growing.

Flash forward to present day. You can listen to the naysayers, and they might be right... or they might be wrong. But you'll never be able to move from where you are until you take the first step, stuck in a never-ending spiral of negativity and analysis paralysis. Or, you can take the first step, make sure your numbers work AND have proper reserves to get you through any actual downturn.

@Shannon Sullivan I suppose moving to Vegas being a "mistake" depends on a lot of things. I probably wouldn't want to leave Tampa for Vegas, but frankly I didn't want to leave LA for Vegas either! It ended up working out well for me in the long run, but it took me a long time to adjust. I've been out of the country for the past 6 years though, and the market has really heated up from what I've seen and competition is fierce! I'm not a rehabber, but I'd expect that if you were looking to come flip in Vegas, you might be fighting a lot of incumbents at this point.

It's typically 5-6%.  When you're thinking 3%, it's actually 3% EACH for the buyer and seller's agents.  Thus 6%.  I know it sucks, but they need to make a living too.  

That said, I would say that 5% has definitely become more commonplace in recent years, and if you're really wanting to go lower, I've known people who even go lower... But these are usually either a close friend (who is giving up most or all of their commission for you) or a "part-timer" who has a day job and moonlights on the side. In the case of a moonlighter, I would say that you should probably remember the old saying "you get what you pay for". In regards to a close friend, I wouldn't want to screw them over too much either.

I'm (partially) with Jerryll. It's all about the WHY you're doing it. He's doing it so he can sit in Hawaii one day sipping Mai Tai's while the money to pay for it shows up every month in his bank account. Jim does it because he hates people (just kidding), rather he hates the typical grind that other people have to live. He's found a better alternative that suits him, and it seems that he never wants to end up as a corporate wage slave. I'm a corporate wage slave that wants to be more like Jim or Jerryll, but I'm much lazier. I do both so that one day I can grow this into something I can pass on to my beautiful little girls. I'm probably moving at a much slower rate than either Jim or Jerryll, but I'm moving in the direction at my own pace. I'm enjoying the fruits of my labor along the way. Everyone has their own pace, but part of this is because everyone has their own GOAL. Mike wants to enjoy the process. Jerryll wants to be filthy rich. Jim doesn't want to become a bitter corporate zombie. I do it because I'm lazy. I'm good at my job and I'm lucky that it pays enough to allow me to provide a good life for my family and also invest. I invest, so I can eventually not need to have to worry about paying for my kids' college educations or my own retirement. I don't have a driving need to retire early, but I don't want to be working till I'm 80 either.

So the biggest question you probably need to ask is. WHY are YOU doing this? At the end of the day, each of the people who have responded, have basically told you that they're doing it for their own HAPPINESS, whether current, future, or both. If you can't see where REI will bring you happiness somewhere along the line, and that happiness doesn't motivate you...

I still love the prospects for Vegas but since my focus tends to be on the B neighborhoods, the prices have really been going crazy lately. While I honestly believe that Vegas still has a way to go before it peaks, I'm also worried about all my limited eggs in one basket. That said, Vegas has a lot of great things going for it. My personal experience with Vegas has been great these past few years. Appreciation has been good, and I believe it will continue for a while. Rent has been moving up, and I get a lot of applications every time I have a vanacy. Those willing to do C neighborhoods and Section 8 are probably making a killing since the last vacancy I had dozens of Section 8 applicants every week. I've never had a property stay vacant for more than 6 weeks, and very low turnover in the past 6 years. There's low unemployment and decent job growth... I still think it makes sense, but I've only invested in Vegas. Some of the things I've read about the other markets have been really impressive but I can't speak from experience on those yet.

Anything is "okay", it just depends more on your own financial situation. If you can afford it and the numbers work out, then go for it. If the property is "nicer" it might just mean that you've paid a premium for the sake of your own comfort. I'm a relatively lazy investor. I bought two distressed properties in the past, and I frankly hated the experience and work involved. Now I stick with turnkey buy and hold. It's slower, but I'm happy and that's also important. It gives me more time to spend with my kids. You may or may not make a little less money, but your happiness and comfort are really also part of the equation. "Nice" or "livable" also don't mean that you can't add value. In the end, as long as the numbers and opportunity costs work, then have at it.

@Chad A Burge most of the real estate websites (ie Zillow, Redfin) also have property tax info and it's really easy to navigate. Keep in mind, property taxes (at least in Vegas) are at least partially assessed on the LAND as opposed to the physical structure. I only discovered this when I bought a small old property on a huge lot and the property taxes were actually more than my much, much nicer, newer, larger, and more expensive personal home that was on a smaller lot.

I second the HELOC, you can probably pull at least 100k out of it and head to your next deal in cash (and then try to refi after). Since your home is owner-occupied, you have a ton of HELOC options. Will your bank allow you to count your rental income? If they don't look towards another bank as many of them do.