All Forum Posts by: Scott Cooper

Thanks for the detailed response @Jerry W.  Sounds like you've gone through similar dilemas to what I currently am.  

The 15/20 year loans is an interesting one.  I've been using 20 years as the default (since it is the preferred loan term of the bank that I use).  Switching to a 30 year (which I don't think is on the cards) would immediately add $120 a month of cash flow.

@Chris Sellers Thanks.  (Worringly) I haven't spend much time considering value add opportunities and instead been focusing on turnkey only.  I will start to do so now though...

@Jay Hinrichs With cash flow being minimal in the initial years I guess I'm trying to figure out if the 3 other factors are sufficient (when they exist in small quantities).  I realise that it will never be "buy and forget", but good tenants paying off nice homes and some price appreciation over time is much more attractive than C/D class cash flow heaven properties.  Of course, if I was looking to turn this into a career, then cash flow would be much more important to me - but my "real job" already takes up enough of my time...  

@Jason Ray Richardson That makes a lot of sense, especially when investing at scale - I definitely wouldn't want 30 cash flow neutral properties as the risk in a downturn would be far too high. However, would you still have the same concerns about cash flow neutrality if we were only buying 5 properties and had sufficient salaries / savings to sustain through any periods of low occupancy?

Hi BiggerPockets,

Rental yields in my area are low.  To bolster the yields I would need to buy in areas that I would not feel safe managing the properties.  

Instead, in conjunction with a partner, we have been considering buying a number of rentals in good quality neighbourhoods where there is significant demand for rental properties.  The monthly cash flow available after tax, vacancies, capex,  mortgage etc. would be close to zero.

However, if we took the long view on such properties, with the aim to have them cash flowing well in 20 years after the mortgage is paid off, is it still a good investment?  From a long term wealth creation perspective, is there anything wrong with this approach?

Thanks