All Forum Posts by: Samuel Merrick

@Reid Chauvin @Alan Ouellette @Marshall Leipprandt

Appreciate the feedback! That's definitely the route I was leaning towards. I'll add another layer to this conversation...

Option C) - Put down only 10%, now keep $40k in the bank.. BUT I'd be coming out of pocket aprox $250/month to stay up on the expenses. That money that I will be "losing" is peanuts compared to the appreciation growth and tax benefits, but a negative COC return is not something I feel exactly keen on.

Some other background details... The property is a recently renovated house in an extremely strong rental market. I have a good W2 job presently, but I'm a realist who understands that my industry Theater/Entertainment isn't necessarily the most reliable over time. My strategy is not necessarily to quit my job, but more looking to build some longterm wealth to eventually retire with. Anyways, thanks in advance for your thoughts!

I'm closing on my second deal in the coming weeks on a buy-and hold-single family house that I plan to house hack. I'm still waiting for my appraisal to come back which in large part will dictate how much money I'm putting towards the down payment and the appraisal gap coverage. The threshold in which the math works for me and my strategy is fairly wide, but ultimately I'm trying to decide how much to put down....

A) 15% (aprox 60k- have close to zero cash flow but have 20k more in the bank )

v.s.

B) 20% (aprox 80k - $200 of monthly cashflow but have 20k less in the bank)

I love the idea of having more cash on-hand for any big expenses that come up and/or also as a nice chunk to get started on my next investment. And perhaps in a few years when rates drop a bit, I can always refinance bringing down my payment.  But conversely, I also love the idea of that extra $200 coming my way every month to give extra padding to a rainy day/next investment fund.

I realize many of you might say do what is best for you and your situation, but I'm curious as to how you BP-ers think about it in regards to the market trends and inflation. Thanks!

@Evan Polaski

thanks Evan. That's a great perspective. It's the deal, not the "house". I have a cash flow and ROI threshold in mind that I'll use as my guide going forward. Appreciate it!

@Mark Sewell

Thanks for the response Mark. It’s a great question that I’ll figure out in the coming years. But for now, all I can do is just find the great deals and do one of those at a time.

@Joe Villeneuve

That’s a great point. Replacing money is the best way to look at this. Thanks for the response.

@Scott Mac

Ha! I grapple with the option of sucking it up and staying on the road very often. We’ll see what the next 6 months bring....

@Dan Schwartz

Thank you! That’ll be absolutely something I’ll look at when I come off the road but Unfortunately my present company will only allow the musicians to be W2. Great intel though. Thank you.

@Jacquelyn West

Great call. I think 2-3 properties is absolutely possible. I’m probably going to have to expand my geographic scope as properties in Nashville proper become quite pricey. Best of luck !

@John Teachout

Nashville is the ultimate living destination. I was in NYC for 10 years prior to the tour so it’ll be a big change and, despite having a handful of musician friends there already, it inevitably will take a little time to get my footing in the scene. But good call on getting a jump on networking and such before leaving tour. Thanks!

@Lauren Juarez

Thank you! I’d certainly like to find a non-touring job with a steady pay check but they are very far and few between in the music world unfortunately. Before leaving the tour in March 2021, my goal is to purchase one more rental property while still having the remaining capital left over for a rehab/ brrrr deal. The phase after those purchases enlies the conundrum!