All Forum Posts by: Michael Sokolski

Originally posted by Dave Kennedy:

Does one form a company LLC and then purchase each individual investment under its own LLC?

Lets say my company was DK Homes LLC...I then have an apartment I'd like to but on Park Street(call that building Park Street LLC).

Would I have DK Homes LLC purchase Park Street LLC? Or would I just buy the Park Street LLC seperately and not have it be affiliated with my business ?

I went to a Rich Day 3-day seminar and this is what they said. Depending on what insurance you have, your total property value should not exceed your insurance. For example, lets say your LLC has $1m in coverage. If you own 3 properties totalling $900,000, you should start another one if you're buying another property.

Now, I don't know if that is the best approach. I lost alot of respect for them since 1 1/2 days of the seminar was a sales pitch for advanced classes.

I'm looking for a little guidance from anyone with experience.

I've heard the pros/cons of investing away from home. In my case, (I live on Long island), the only option to invest for positive cash flow, is to go elsewhere. My question is about what type of business to setup. LLC seams to be the overwhelming favorite among real estate investors.

What obstacles would I face setting up an LLC in New York while my property(ies) are out of state?

Do I create an LLC in the other state(s) and what problems might arise from that?

Do lawyers know the laws in each state or would I be better off finding them in each state?

I’m ready to begin my journey into Real Estate Investing and look to join the ranks and share my experiences. Any other advice for a first time investor would be much appreciated. I’ve learned a lot by reading the boards here and will continue. I’ve gotten a decent amount of money to get started (I think) and am trying to minimize my mistakes for my first purchase. I have a few areas in mind and have been looking.

Do you mind me asking where the property is and how you came across it?

I'm new at this also and feel I'm ready to start actually looking. I think I have gotten all I can by just reading and it's time to get out there and start looking, networking, and getting my feet wet.

Thanks.

I appreciate all the advice. When my interest began in REI, I was so gung ho about it. Many said you should start locally, so I looked...and looked......and looked........ My problem is that I live on Long Island. Unless someone gives me a house for free, it will never cash flow here. I lost interest in REI for awhile and I'm getting the itch to get back into it since I'm unhappy with my job and the path I'm on.

I think that I will need to look elsewhere. I have a few areas in mind and have been doing my research. Once I feel I have enough info, I'll make a list, plan a trip and look at a few places.

I look forward to some responses and reading the other posts on this site.

Thanks Mike.

The problem with Long Island (Even during this Real Estate slump we're in) is property values here in addition to the ridiculous taxes and insurance make it very hard to cash flow. Even condo's are going for $200,000 +.

I understand I would also have to factor in a management company if I invest far away. I am looking into areas that I consider up and coming where I feel property values will rise at a good rate for the next 20 years. I'm looking to buy and hold. I also lived in North Carolina for 1 1/2 years while in the Marine Corps. I know people that live there and think I have a good feel for the area. Your idea about Craigslist is a great one and I'll check it out today.

I've seen condos in these areas for under or around $100,000. I have a decent amount to use for a downpayment so it would bring the mortgage payments down enough to get a decent check each month (maybe $200 or so) where I can re-invest and save for another one. I'm not counting on appreciation for the short term, I just want to make sure it's in an area where rentals are in demand.

My question is about starting a business. Since some money will soon be spent travelling, etc., should I start my LLC now for writing off expenses?

About a year ago, I had decided to start looking into becoming a real estate investor. I had read several real estate books (Rich Dad, etc.), gone to seminars, webinars, and some meetings at the local REIA, and was really gung-ho. Living on Long Island, the winds were taken out of my sails after realizing I could not find anything close to positive cash flow. Many advised beginners to start locally.

I'm getting the itch again. This time, I'm going to be more realistic and will look elsewhere. I'm curious to get some opinions on what areas are high rental areas. I would assume that areas around colleges and growing cities would be a good place. I plan on starting some serious research in the Syracuse, NY and Raleigh, NC areas. Mostly because properties are more affordable for me, and these areas appear to have weathered the real estate slump fairly well.

My goals are to purchase rentals for the long term. I'm 37 and want to begin buying properties so that I don't have to rely on a pension and savings in my later years.

What are your opinions on first time investment properties? Condos? Duplexes? Are single family residential properties hard to keep tenants in?

I know I'll learn a ton by reading these forums and I look forward to chatting with you all. Any thought would be very much appreciated. I'm excited to be back.

Since you're so young, you have the luxury of chosing which path you'd like to follow. It might be beneficial to you to find a job in Real Estate. Yeah, you'll be working for someone but you'd also be getting paid and learning the business. There are many career paths out there. Become a Real Estate Agent, mortgage broker, work for a property management company, etc.

Aim high but be realistic. Just my 2 cents. Good luck.

Are you in a situation where you might be able to refinance and lower your monthly mortgage payment?

Thanks. As someone new to real estate investing, I have had trouble finding anything that comes close to positive cash flow after running the numbers. Condo's would work for the same reasons you mention (they are more affordable and the rent isn't much less for what a resindential house would get - not to mention less maint.).

I do live in a college town and would love to get a house close to home. I'm within walking distance of a major University on Long Island and I know from people that the dorms are full. (The dorms are built for 2 people and they're squeezing 3 people to a room). I just can't find anything close that wouldn't cost ME $$$ each month.

Has anyone had any experience with Condo's? Are they treated just like residential real estate? I know of some in desreable area's with a price that would yield a positive cash flow if rented out but I'm worried they're are hidden obstacles a novice would not know about. Do you need to deal with a Home Owners Association like in a CO-OP?