All Forum Posts by: Vaishal Patel

so i have read this on many websites that your property should be cash flow positive..now lets say i buy a house for 250k,i put 20% down and take mortgage loan on the other 80%.My monthly rent would be about 1800$ but my monthly expenses with mortgage,maintance,taxes,insuance etc would be 1900$ so that means i am making a negative cash flow of 100$...now instead of 20% ,i put 30% down which reduces my mortgage payment and thus reduces my expenses..lets say to 1750$...so now i am making 50$ positive cash flow....so how exactly do you determine if a property is cash flow positive..it seems like the more down payment you put the more cashflow you can get from the property...i am confused..?

They have so high property taxes..especially central new jersey, on average you will end up paying 4000-5000$ in property taxes every year for a property worth 250k$.How can you make positive cash flow when you have to pay such high property taxes?

So i came across this term "Passive losses" while reading a post on this website.I searched it on google but i still dont understand it ..What is passive losses?i am newbie so if you can give an example of it,that would really helpful..thanks.

James Hamling :- what do you mean by "which is not taxable until tapped, and then can be tapped tax free as well"? tapped????wats that?

Also i know 350k 15 years from now would be worth less then its worth today due to inflation but still isnt appreciation more then inflation in most cases.

Ok here's wat i think.Lets say i have 250k in cash and i am looking to buy a investment property for 250k. since i am buying it with cash i dont have to worry about mortgage.I buy a good property in a good neighborhood.I hire a management company to maintain and find tenants for the property.Since its in a good neighborhood,it will be full within few weeks.I charge 1500$ rent/month (same as the other properties in the neighborhood).After property management charges,insurance,property tax and repairs i make about 1000$ profit/month of 12,000 anually. Also i am looking to hold the property for atleast 15 years and property prices generally appreciates over long period(most properties would be worth more today then they were in 1997),After 15 years my 250 k property would be worth around 350k.so with a 250k investment i make 12,000/year +appreciation. Is this the right way to think or i am making a mistake??Thanks

One more thing..How much should the rent be compared to the price of the property..Lets say a property is worth 300k...How much the rent should be for that property?Around 1500-1600$ is a good deal?

p.s- some of the questions might be too dumb for you, i m just 20 and know very little about real estate...so..:)..lol

1)At what age did you make your first investment?I am still 20 majoring computer science from a university in arkansas,i will graduate in about 2 years and then 2 more years for masters.Should i start investing now or after i am done with my masters?i know i still have to learn alot about real estate but do you guys think 20 is the correct age to start investing.
2)How do check the vacany rate of a area?i am particulary interested in investing in edison,nj.(i live in arkansas but i can move there).
3)How long do good investors usually search before they decide to invest in a property?I mean like for 1 week-2 weeks?

I have read about people who started real estate investing with very little money and now own hundreds of properties.Last week i was reading about a landlord who owns over 1500 rental apartments,20 years ago he was almost bankrupt and now he owns 1500 rental apartments..what strategy do they use to acquire such huge number of properties?I know they borrow alot of money at the beginning but still what exact strategy/ways these guys do this?Thanks :)