All Forum Posts by: Scott Passman

Based on your numbers things look pretty solid, at least on a spreadsheet. Too many variables to consider when giving feedback on whether or not to purchase a property. If you are planning to take care of the snow removal/lawn care I would use the numbers with property management to base your decision off.  Driving an hour each way is a long way to go for tasks that will need to performed frequently throughout the year and at some point I'm sure you will decide to get a PM.

Make sure you account for vacancy because at some point you will have it.  Also, while I see Rhode Island doesn't have a homestead exemption for property taxes, make sure the city/township doesn't provide owner occupied property tax breaks which would then mean your property could have higher taxes than currently listed if the current owner is living in it.  Just a thought.

This could be both a complex or a simple answer.  Simple answer: learn how to recognize a good opportunity, when you find one, go after it.  Reading is great and is necessary, but eventually the only way to really learn is to go out and do it.  That is where I'm at now. I know I have a solid knowledge base; now I'm focusing on analyzing and offering so I can get experiential understanding.

I am in the due diligence phase of a property with a shared driveway and am interested in others experiences with this kind of situation in a rental property.  There is also a garage with two stalls, one belongs to the property I'm under contract with and the other belongs to the neighbor with the lot line drawn down the middle.  There will have to be an agreement with the neighbor on how this driveway is used and somehow will need to determine who is responsible for maintaining the garage.  Would love any advice from those of you who have had similar situations.

@Adnan M. Long-term buy and hold is pretty risk averse.  When you combine cash flow, appreciation, tax benefits and the loan paydown you get from tenants and extrapolate that over 5, 10, 20 years the compound effect is amazing.  The key is to know your numbers and fundamentals and don't just buy a property for the sake of getting something. 

Other than house hacking, if you want to get involved with real estate sooner rather than later but feel limited by time constraints, lack of knowledge etc., turnkey is another option to look into to get started and build up some experience.  You could also look to connect with others in your area to partner up on a deal.  If you can put 4-5k/month into loans you obviously make good money so you could bring money to a deal with a partner who is more experienced and go about it that way.  Lots of options to start putting your money to work. 

@Adnan M. That's a tough question that a lot of people are trying to figure out. There really isn't a straight answer because it depends on how you are wired. For some people, the burden of the loan debt can be incredibly powerful and take a major toll on you.  Based on the numbers you provided (5% or less interest rate), it would likely be in your best interest to start investing sooner rather than later as you can make your money work for you better by investing it.  

Considering your experience level, my suggestion would be to build up capital to invest over the next year while still paying down your student loans (though maybe siphoning some of that 4-5k/month toward investment capital) so you can take some time to learn the fundamentals, network with other investors, find your market and niche, and have the capital ready to put to work in a year or so.  

House hacking is a great option, but it certainly isn't the ONLY viable option for you.  Figure out your goals, then work backwards on how to get there. Best of luck. 

@Clint Galliano Real estate investing, like everything else, is about mindset.  That is why Rich Dad Poor Dad is so ubiquitous.  It doesn't teach you how to DO anything, but it reframes how to think.  I feel like everyone is looking for the silver bullet to learn this stuff quick and get rich.  Focus on what you want and why you want it.  Make a plan and just work on that next step. If you are consistent and persistent then good things will happen. 

@Brian Lynch While this isn't a book, I had my wife listen to episode 290 of the BP podcast which really helped start the conversation with her. It is titled 7 paths to financial freedom, but ignore the title.  What is so nice about the episode is it gives a nice simple overview of different ways real estate can and does work.  It doesn't get deep into details, but rather stays more on the conceptual front which was nice for her to learn how real estate can work and the powerful ways it can add up. If you just have her listen to the 7 steps without the intro, "fire round" and "famous four" then it only takes about 45 minutes.  Side note, she is also reading Rich Dad Poor Dad now too. 

@Jacob Lee Another option would be to spend more of your time and energy right now networking and connecting with people who do have knowledge of and access to off-market deals.  Connect with people in the area on BP, if they are local, meet up with them in person and start forming relationships.  Build enough relationships and they can help you find deals you might not normally have access to.  It is a great way to learn and start building that funnel for leads to increase your opportunities.  

@Brett Goldsmith Thanks for the advice. I hadn't even been considering a short sale until this kind of fell into my lap so I'm researching as I go to help determine if this is an option to pursue.  We'll see how things go and I will take it step-by-step but I'm definitely not banking on this one property alone. I have 2 other leads I'm working with as well and I'll see which one presents itself as the best opportunity, if any,  and go from there. One thing I like about looking at properties from an investment viewpoint is if it doesn't work it is easier to walk away.  When looking for a primary residence it was much harder to detach emotions from the mix.

@Brett Goldsmith Thanks for the reply. The house is in fact listed on the market. When my agent asked her co-worker (who specializes in short sales) to do a search on the property she said nothing came up on the short sale/forclosure website. So I'm not sure exactly which site she was referring to.  I do have an agent who is working with me and she is also an investor, though admittedly she is not very experienced with short sales.  This is her exact response to my inquiry: 

"This means that the bank has not actually taken ownership yet i.e. foreclosure. If the owner hired a good attorney they may be dragging it out or if the bank is busy they may not get to it for 6 months to a year. It does not mean that you cannot move forward on it if you like it. It will just take some time to get all the parties involved to sign off on it. "