All Forum Posts by: Sean Gallagher

So a good COC return is a lot easier to obtain when using leverage. When purchasing all cash on the same deal it's a lot more difficult to get a similar COC return, the numbers aren't even close. If purchasing all cash do we just accept a smaller COC return?

How differently are you analyzing deals when going all cash?  I liked the idea of cash because purchasing is a lot easier (don't have to deal with banks), a lot less risk, more cash flow per property.  And even though I would have a lot of cash tied up, I would always have the option to cash out refi.  Of course it's a give and take between the two..  higher risk higher return potential.  I just think I'd rather have 10 paid off properties vs 50 leveraged.

Are these section 8?  Pretty tough to get a B home in a nice neighborhood to meet the 2% rule.  Most likely going to be a C / section 8?

From what I'm seeing the higher rents are getting harder to make work does anyone else notice this?  A lot of the homes that will rent for 2000 - 2500 are in much nicer areas which are the ones who have seen large increases in property values over the past years.  The 1000-1500/mo rents seem to be the most common?  Which just means we will have a lot more properties to reach our end goal versus a lot less homes that will rent for more to reach the same end goal.  More headaches.. humm  

AI is taking over

So those of you who are against the 1% rule or don't use it as a strong indicator, what is your preferred indicator on a deal, COC, ROI, cap rate? And if it's one of those what is your ideal number.

 Working with excel now, you're right!  I can set up the formulas to work in a way where 1 input can change numerous ones at the same time.  Works well.

 So you have your first rental at the top, it cash flows, you then use that money for the next property, and then another property.  You could create a cash flow tree showing how you can snowball the income $ to purchase more and grow.  I've seen the visualization on a youtube video but can't remember which one lol.  Excel may work

Does anyone use a tool of some sort to plan out a cash flow tree with rentals?  Sometimes known as a cash flow snowball.  It's easy to draw out but it's not easy when you want to change your numbers since one thing effects the other.

I'm trying to find something where you can put your first rental at the top, type in it's cash flow and keep working your way down as you acquire more properties.  That's the short explanation, of course the more data points to enter the better.