All Forum Posts by: Eric Bilderback

No way man!  Great fishing, best place in the world for kids to grow up, solid community, beautiful scenery, family.  But if I was a bachelor I would consider moving to Detroit.  

I'd be breakin necks and cashin checks BABY!

Do it go to Detroit, and when you get going hit me up I'll invest with you!

I'm not saying that we are on a bubble that is about to burst.    I am just looking around and not seeing how any of these homes are that great of an investment.  I think that they could be decent investments over the long run but I am beginning to think that by the time you are done looking and analyzing all of the different properties you would be better off just working some overtime or more on your business (non-real estate).  I don't see a big drop coming just a stagnation that brings very little return.  Looking to the near and mid future I see interest rates going up which should have a negative effect on real estate prices, as investors that don't want to be in real estate can invest in something more liquid bonds etc.  At least where I am (and I think this goes for the majority of the coasts), I don't think renters could afford much higher rent.  

Here is a quick "typical" scenario would love to here your critiques.  

Invest 50k in buy 200k you get 4k in appreciation and in my area you will have a hard time cash flowing.   But I am going to assume for the sake of argument you are a super stud and found a deal that cashflows 2k per year, and you have about 2k in debt pay down.  Average stock market gets you 7% which is 3.5k without doing a damn thing.  Houses seem like a lot of trouble and risk for an extra 4k a year. 

I want to believe that I can still find financial freedom with buy and hold real estate in five years or so? But I have trouble believing the numbers support it any longer.

In the places I invest, live, and pay attention to the 2% rule does not exist.  An .8% rule would be pretty good assuming it was a clean and in a good neighborhood.  I would love to live in an area where there was a  2% rule.  I would deal with all of those losers screwing up my place, it would be a pleasure compared to buy and hold and waiting for 10 years to monetize your returns.  You could get financially free pretty darn quick if the 2% rule was practical where you live.  The appreciation game here in Central Oregon especially lately is a grind and it is long term.  But buying and holding with 20% down is not going to take a while my friend.  Assuming you are in a market similar to mine, you found a good deal nice work.  Me and you will just have to listen to how great the life is for all of those guys in the those areas that get big returns on the podcasts.

Happy Memorial Day 

Alexis,  

I am in a similar situation. I am trying this right now but no results yet. Heres what I am doing. I looked up all of the duplexes and more units that were put on the MLS since 2010 and did not sell. Then finding the owner by looking into the county records contact them call or mail if I cannot find the phone number. Then see whats up. I did this before and didn't close any deals but both of the landlords I spoke to and met were cool. Not acquired at all they just wanted more then I was going to pay. I currently have all of the landlords for my farm town which is 15 or so. I bet I will get a deal out of it. I also have been writing down the addresses of places I like then I can look them up online and see if they want to deal as well.

Speaking just for myself I would get a kick out of some contacting me.  I would love to have a conversation with them about what they are trying to do and see if we could help each other so I don't feel uncomfortable calling investors.  If you try some direct mail let us know how it turns out I will follow this link.

Good Luck,

Thanks for the feedback!  Searching on the internet it looks like 8% is extremely conservative.  More like 5-6% seems like the spot that people underwrite.

15 1 bedrooms in Oregon (we have more water then the Pacific Ocean).  I pay 1k a month for sewer and water.

Is there a rule of thumb for an old place built in 1900.  Right now I am using 8% for Repairs and 8% for Cap Ex.  What do you guys think?  The place is in good shape considering the age.  But I am nervous about the age.

Thanks for the feedback,

Jeff,

That is a great idea I will look into financing it then getting a second directly from her. 

Laurie,

I do not own the property out right.  And that is correct I feel the manager is getting a very good deal and I could have him manage some extra units for free basically.  

I was hoping there was a way I could keep it somewhat simple and use a loan for my down payment.  Which I can see being difficult but I wasn't sure if you could do it or not.  Thank you for the responses.

I would rather look dumb in a form on BP then face to face with others.  ("It is better to look dumb and have people assume your stupid the to open your month and remove all reasonable doubt." Abraham Lincoln I believe).  

Here is my deal.  I have a small apartment complex (15 units).  A guy lives there for free to manage it for me.  I want him to do more for his free rent (it is a gravy gig).  A 4 plex across the street popped up for 250k I called the realtor they are not firm.  Rents are 2100 and are under valued I think.  This would be perfect to along with the other property.  I am self employed and I need a big wad of cash to sit on to feel good so I am not willing to put must of my reserves for this as a down payment.  

Here is my question, a lady I have met in person through BP is willing to give me a loan if I put 5% down but wants an 8% return for herself.  I cannot find many properties to make this pencil.  This one would if I used her loan to me as a down payment of 30% or so.  Can I use her loan as a down payment and then borrow the rest from Quicken or whoever.  Or is this not kosher.  This sounds like how the financial crisis started, but I am very confident this will cashflow.  I read through many of these discussions and have not ran into anyone discussing this precise situation.  Would you guys fill me in?

Much appreciated,

It is a good debate.  I go back and forth myself.  Financial freedom is what I find so attractive about real estate.  Having 10 paid for properties seems like the least risky way to go about that.  Although I can see people more experienced then myself disagree.  Currently I am using more leverage then I will be in 5-10 years but as I get out of the cashflow creation mode in to a preservation mode I think I will use less debt.