All Forum Posts by: Mostafa Faghih

Hey @Mykhailo Strelchenko, congratulations on taking your first step toward real estate investing and house hacking! I must say that you're on the right track. House hacking is one of the best strategies that can help you achieve financial freedom.

To make the most out of your house hacking strategy, you gotta familiarize yourself with some key concepts in real estate investing. One of my favorite concepts is the leveraged buyout (LBO), which can help you acquire properties that generate significant cash flow through short-term rentals, making your journey toward financial independence much faster and smoother.

When it comes to house hacking, you should also consider the type of rental strategy you'll be using. Long-term rentals are great for steady income, but if you choose the right location, short-term rentals can be much more profitable (up to 160% more than long-term rentals).

I've been working on a theory and other types of house hacking for months now, especially on finding properties that can offset or pay off their mortgage and bills entirely. If you're interested, I'd be more than happy to share my research on hot markets and top properties with you.

How can I find the historical rental records of homes on Airbnb? (Annual earnings). I'm referring to the transaction history of a property, not the AirDNA neighborhood estimation.

Quote from @Luke Carl:

You buy a house you rent it out you buy another house you rent it out. Works for me! 

Great! So, is considering the occupancy rate and average daily rate of a property, along with taxes and expenses, mortgage payments, etc. enough to accurately calculate the Net Operating Income of the property?

Quote from @Brooklyn McCarty:

House hacking is probably the #1 way to build wealth in real estate because you are living for free and someone else is paying for it all. 

Buy a duplex, triplex, quad if you can with a residential loan, live there a year and do it again! 

Great strategy 

Actually, I'm thinking about a similar way to house hacking that I mentioned in the question.

Quote from @Kenneth Garrett:

Building wealth requires cashflow.  Appreciation is a bonus.  If the property rents for $2500/month and your all in expenses are $2000 that’s a $500 monthly cash flow.  I tend to use cash on cash return as an important metric.  How quickly can I get my down payment, closing costs and rehab if any back.  Example down payment is 20K and closing cost are rolled in the loan, no rehab.  That’s a 30% return on my money.  In 3+ years I’ll will have all my cash back and I can repeat the process.  That is how you build wealth amongst other investment strategies.

Thanks, Kenneth. Is considering the occupancy rate and average daily rate of a property, along with taxes and all expenses, enough to accurately calculate the profitability of the property?

Quote from @Nathan Gesner:

Quote from @Mostafa Faghih:

Is this a serious question? This is the definition of real estate investing and it's what all of us are doing. It's described in every book, blog, YouTube video, news article, etc. Buy a property, rent it out for more than it costs each month, rinse and repeat.

Thanks, Nathan. So, why aren't all people utilizing this strategy to achieve financial freedom?

Quote from @Brooks Gagnon:

Quote from @Mostafa Faghih:

Quote from @Brooks Gagnon:

Looking for some thoughts on buying a flip using your own cash, versus getting a hard money loan. What do you think are the advantages/disadvantages of both, and which would you likely prefer to use. Personally, I have always been a fan of using OPM (other people's money), but is it worth the added expense if you have plenty of cash to fund it yourself? Would love to know what everyone thinks!

Leveraging the loan is one of the smartest strategies for creating wealth. I highly recommend reading about LBO (Leveraged Buyout), especially how to use it in real estate. If you're interested, I can elaborate more.

Could you? I’m not familiar with leveraged buyouts. 

Sure, here's an example of an LBO in buying a company:

Let's say an investor wants to acquire a company that has a value of $10 million. Instead of using their own cash to purchase the company outright, the investor decides to use debt financing to fund the acquisition. They secure a loan for $7 million at an interest rate of 5% per year and use $3 million of their own cash as equity to acquire the company.

Over the next few years, the investor works to improve the company's operations and increase its value. If the investor is successful in growing the company's value to $15 million, they can sell the company and pay off the loan, keeping the profit as their return on investment. Assuming a sale price of $15 million, the investor would pay off the $7 million loan, leaving them with $8 million. After subtracting their initial investment of $3 million, the investor would have made a profit of $5 million or a return of 166% on their original investment.

In short-term rental investments specifically, leverage can be particularly advantageous, as short-term rentals tend to generate higher cash flow and more stable income. However, leveraging comes with risks, such as the potential for the property not generating enough income to cover loan payments or becoming unmanageable in the event of rising interest rates or a market downturn.

Quote from @Brooks Gagnon:

Looking for some thoughts on buying a flip using your own cash, versus getting a hard money loan. What do you think are the advantages/disadvantages of both, and which would you likely prefer to use. Personally, I have always been a fan of using OPM (other people's money), but is it worth the added expense if you have plenty of cash to fund it yourself? Would love to know what everyone thinks!

Leveraging the loan is one of the smartest strategies for creating wealth. I highly recommend reading about LBO (Leveraged Buyout), especially how to use it in real estate. If you're interested, I can elaborate more.

Quote from @Kent Petersen:

Columbus is adding multiple developments in the next couple of years.

First, Intel being built is bringing 7,000 construction jobs, as well as 3,000 permanent jobs to the city!

Secondly, Nationwide Childrens Childrens hospital is adding on a new orthopedics and surgery center, new research facilities, and a new 12 story inpatient hospital tower. 

Lastly, there have been talks about a professional volleyball team that will be calling Columbus their home town. This looks like they will be hitting the city in 2024. 

Lots to be excited about for the city of Columbus!

In Columbus, OH, the property price appreciation would grow by 1.619%, according to WalletInvestor's AI-powered forecast. However, I am not sure if it is reliable.

Based on WalletInvestor forecasts:
1-Year forecast
1.619%

5-Year forecast
8.618%

10-Year forecast
16.315%

What do you think?

Quote from @Marc Rice:

Quote from @Mostafa Faghih:

I'm looking for top properties in the short-term rental market in Columbus, OH and Kansas City, MO.

I want to know more about the current state of the market, top-performing neighborhoods, and high-quality properties for short-term rentals. If you have experience investing in short-term rental properties in these cities, please share your insights, strategies, and tips for success.

Thank you!

 Columbus is a great market for STRs and MTRs. I specialize in 1bds and studios here.

What about single families? I have gathered some information about single-family properties that can provide a cap rate of over 10%! Would you be able to validate my calculations based on your experience?