All Forum Posts by: Scott Tarantino

I would agree with most of these posts. I got into buy-and-hold REI about 18 months ago (at age 50) and currently own 4 properties and about to offer on a 5th....all with the BRRRR strategy. Here is my advice to you...

1.  Do as much reading as you can (books, BP, etc) and watch FREE webinars/podcasts, etc.

2. Decide what you want to do in REI.....wholesaling, buy-and-hold rentals, flips, etc.

3. Definitely get a real estate coach or mentor who can help you, but someone local you meet with face-to-face and someone familiar with and actually doing what you want to do in the geographic area that you want to do it. You can find them on-line, at local meet-ups or REI clubs in your town. It makes no sense at all to pay a mentor who lives far away and is unfamiliar with your market.

4.  Take action and actually do what you want to do.  Most people do the first three things and then sit back and wait for stuff to happen--it won't.  I was terrified with my first purchase, but it is all part of the learning process.  

Best of luck to you. I wish I had started with REI 20 years ago.

If I'm understanding correctly, you have a portfolio of 30 properties, but use a revolving door of 10-12 per year to reap the benefit of the appreciation that has occurred.  Great model, but obviously that takes a long time and a lot of capital.  

Your approach seems to make good sense for where you live and it sounds like you are very good at it, but let me ask a few basic questions:

1.  Would you buy a net-negative or net-zero cash flow property for anticipated appreciation?  

2.  What happens to you when the real estate market takes a dive like in 2008?  There were many "appreciation investors" who lost everything.  

I know people who have purchased properties for appreciation because some "big company was moving to town and the values were going to skyrocket" or based on some news their buddy told them, who subsequently lost everything when the company plans changed.

There are many ways to skin a cat.  

Thanks for the info.  For me, I'll continue to buy for cash flow and consider any appreciation as the "icing on the cake."

I failed to mention in my original post that I do all Sect 8 housing in the city.  Some of my tenants do not even have checking accounts so using electronic transfer systems simply doesn't work for me--they all pay by money orders.  The PO Box is cheap and I only live a few miles from the post office.  Being that I only have 3 units, this is manageable.  If and when I build my portfolio to 20-25 units, I'd definitely be looking to simplify the process.  For now, still learning......

I don't put the stamps on the envelopes, just the address and the month so there is no confusion for the tenants.

Thanks for the response.  Very helpful

I don't want my tenants having any of my personal information.  Here's what works for me:

1. Create an LLC and buy the properties in that name (don't name it Joe Smith, LLC)

2. Rent a PO Box in the LLC name. All rent gets mailed there. I give my tenants pre-addressed envelopes labelled by month. I don't want my tenants having my personal address and showing up at midnight on Friday to drop off the rent.

3.  Get a Google Voice telephone number.  Its free.  When they call that number, it will get forwarded to wherever you want.  I forward it to my cell number, but the tenant sees the GV number on their phone.  You can also forward the calls to whatever number you want, so if you go out of town, you can send the calls to whoever is covering for you quite easily.  This platform also allows texting as well.  You can set it up to send you an email notification whenever you get a text or call as well.  

4. Create a gmail address for your LLC and use that for all real estate communications.

My tenants can contact my by text, phone, or email, but not on the same platforms that my friends use.

**BTW, I learned all of this and want to give credit to my real estate coach and mentor.....Mark Owens.  

My real estate investing coach taught me this from day one.....if you are looking to get into real estate as a way to gain financial freedom and work less, then there is only one answer to this question.....CASH FLOW is KING!!   Thanks Mark Owens.  

Full disclosure--I started doing this one year ago.  I am new in this game and still learning.  I currently only own 3 properties, but they are all cash-flowing $350-500/month.  As long as they are doing so, I never need to worry about being forced into selling--they pay for themselves.  This allows the option of holding the properties until selling makes the most sense for me.  I also gain the mortgage pay-down in equity and the tax advantages of real estate to offset my gains.  Its a win, win, win.

Cash flow pays your bills, appreciation does not.  Cash flow creates financial freedom, appreciation does not.  Cash flow provides a cushion if things go wrong, appreciation does not.  Cash flow gets you your money now, not in the future (remember the time value of money).

If you have tons of cash that you are looking to simply park someplace other than the stock market and don't care about cash flow, then buy in highly appreciating areas...but make sure you have enough reserves to pay the mortgage and other carrying costs when the economy or the market tanks and you can't find any tenants.  You need to also be ready to pay for that big maintenance issue (new roof, HVAC system, etc) since you'll have no income from the property.

I have done a lot of research into this topic as I was getting my feet wet in real estate, and there is no doubt in my mind that CASH FLOW IS KING!!!

Hey Elijah--I am brand new to the REI world in Baltimore as well (after about 10 years of simply saying I was going to do it) and currently have my first 2 properties (buy/hold with a BRRRR strategy) under contract. I would suggest the following for you....educate yourself as much as you can by reading the blogs and watching the podcasts on BP, going to meet ups, joining a REIA, and networking. When you are ready to make your first purchase, find and pay for a mentor--it will pay you back many times over. I did, and it made a huge difference in my confidence that I wasn't going to make some huge mistake--I put my first contract in after about 4 weeks of mentoring and a second 3 weeks later. I am working on a third deal in the form of a wholesale or flip....we'll see. Its been a ton of fun!! Best of luck.

I am a new in the real estate investing world and put my first offer on a property just a few days ago.  I found a local mentor through BP, have done a lot of webinars (BP and others), and gone to meet ups to get myself more familiar with the real estate world locally. 

I have been amazed at the incredible generosity demonstrated by those in the real estate business in sharing their time, experiences, and wisdom.  Yes, there is an indirect benefit because when people help you, you'll help them in return later.

Being from NYC, I understand your cynicism and being a skeptic.  There are bad people everywhere in every business.  I personally have found those around me and on BP willing to help because they know it will come back to them 10x over in other ways.