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All Forum Posts by: Richard Dunlop

Richard Dunlop has started 7 posts and replied 714 times.

Post: New Member from Baltimore, MD

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Lois Stern:

Hi all!  I'm Lois Stern from Baltimore County in Maryland.  I'm a project analyst for Johns Hopkins  System....

My husband has always rented an office suite and then rented out the other offices to keep his own payment low.  I encouraged him to do the same in the office suite next door and he is now working rent free with a small income! ....

... I'm also looking for information on how make one's IRA or mutual self directed - and then how to utilize that income for investing.

You should go one step further and buy the properties instead of renting and making a small spread on sub-letting with assoc risks of vacancy.

The 401k or other retirement accounts you have now are probably untouchable as long as you work there. Talk to HR possibly could borrow against it. 

But your husband could possibly set up a new Solo 401k if he has no employees

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Account Closed:
Originally posted by @Troy Whitney:

 Oh my!  Now I must see your figgers.  You are like Donald FN Trump.  (I sense a little of that bitterness again. Edit by RD in parentheses)Yep, you smacked the smugness rite outta me.  Please elaborate on your rent ratio returns!!!  

500 houses times $806 ALL in equals..$403,000!!!  He's a thousandaire!

 In this thread and others you derisivly point out "Newbie mistakes" 

Without name calling allow me to ask about the mistake ridden above post.

I don't have 500, I have 25 but we'll let that go. I'll use your figure.

What does the price I paid have to do with my net worth? Are we counting marbles in our jar? In HI are your properties only worth what you paid. 

Wouldn't it be better to multiply value instead? 500 × $23,000 = $11,500,000.00.

The other figure you also didn't calculate that might have some relevance is what is gross rent? 500 × $650 would be $325,000.00 per month.

I already said I don't have 500 houses that was a number you made up to ridicule.  

I also would like to make it clear that $806 purchase do no work rent for $650 per month is not typical.

I will be selling that one and I'll let you know how much it sold for. Because I need money to fix my $5000 puchase that will rent for more than $4000 per month.

$150 to $750,000.00 in 6 years.

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Account Closed:
Originally posted by @Richard Dunlop:

Your post does ring with bitterness, but on one note we agree; I would never touch a 2% deal.  

 Um, where's the bitterness?  I only pointed out the mathematical fact that the .5% rent ratio means the market has determined that the rent in that market is more desirable.  It doesn't take an advanced degree to understand that. 

We obviously have differing ideas and markets but in every discussion we've had I've been respectful and courteous. 

I described your post as "ringing with Bitterness" you first made reference to "poorer" I took no offense and pointed out I was poorer than you were imagining. (Was, but not anymore)

That seemed to rile you so you spewed out a whole bunch more of name calling including one you felt the need to self sensor. 

I respect HI and CA but if I'm wanting to make a living of course I can't invest at 1/2 of 1% gross return.

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Steve Olafson:
Originally posted by @Richard Dunlop:

Gross rent (like the 2% rule)

 I bought a house All Inc for $806. It was rented to a 3 1/2 year tenant when I bought it. Tenant pays all utilities it is rented for $650 a month. (650÷806=80.645161%) I've owned it for 5 months and not yet spent $1 on anything.

I have twice proved this to scorners by PM but they did not choose to acknowledge it, but they did stop ridiculing my statements.

 The interesting thing about this is that these properties are probably worth a lot more now.  So you have the added benefit of "right place/right time" going for you as well.  From what you said earlier, you can still get some great deals.  Good job.

How much could you sell these houses for now?

 Some of that "right time" some not. The example I gave was purchased 5 months ago.

My house that I bought for $16,000 was 6 years ago. In a previous post one scorner did acknowledge the picture I posted was purchased by me for $16,000 but then claimed "my value was way wrong because Zillow valued it at $260,000 and everybody knows Zillow is inflated"

A house in my neighborhood just sold a couple of weeks ago for more than 3 times the Zillow est.

1560 Bagley St Detroit MI 48216

sold price $219,900 Zillow est $70,600 for a frame 1800 Sq ft house

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Steve Olafson:

 I am truly interested in hearing about the 81%.  Is this a total return on money or actual cashflow?

Gross rent (like the 2% rule)

 I bought a house All Inc for $806. It was rented to a 3 1/2 year tenant when I bought it. Tenant pays all utilities it is rented for $650 a month. (650÷806=80.645161%) I've owned it for 5 months and not yet spent $1 on anything.

I have twice proved this to scorners by PM but they did not choose to acknowledge it, but they did stop ridiculing my statements.

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Joe Bertolino:

Using common sense... Why would local RE agents and their investors let a good property fall to a rookie investor from 2000 miles away? 

There's about 6 good answers to this question. But I'll start with this one: When I first came up here I ran into (I still do)investors that had lost all of there properties to foreclosure and warned me that you couldn't make any money in real estate in Detroit.  

I would ask details of their experience and investments and then ask if I bought for $1000 the same house you bought for $80,000 do you think the outcome might be different? 

They usually gave me a funny look like they hadn't seen it from that angle before.

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Account Closed:
Originally posted by @Richard Dunlop:
Originally posted by @Account Closed:
Originally posted by @Richard Dunlop:

Why settle for 2%?

 Not me.  I'm a solid .5% man.  I let the newbies and the poorer people tangle with the less desirable properties.

"Poorer" you're over-rating me! 

I started with nothing!

 Cheaper might have been the better word since the 2% ratios seem to be marketed to California people because they have the cash.  So I guess the 2% ratios are for newbies, the uneducated and the cheap bast*ds.

 I proudly claimed your "poorer" label, but the uneducated I can't claim I have a Master's degree.

I wanted to make an income right from the start instead of doing it for a hobby while I kept my day job to pay the bills.

Your post does ring with bitterness, but on one note we agree; I would never touch a 2% deal. Life is too short to work that cheap.

I kind of like the one I did for 81%. My appraiser is trying to buy that one from me and wants to back me on about 20-30 properties. 

When I'm rich like you I can work for less but for now I like the path I'm on.

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461
Originally posted by @Account Closed:
Originally posted by @Richard Dunlop:

Why settle for 2%?

 Not me.  I'm a solid .5% man.  I let the newbies and the poorer people tangle with the less desirable properties.

"Poorer" you're over-rating me! 

I started with nothing!

Post: 2% rule..is it still real?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461

Why settle for 2%?

Post: $150,000 profit - what about taxes?

Richard DunlopPosted
  • Investor
  • Detroit, MI
  • Posts 754
  • Votes 461

In Michigan an adjoining separate parcel can be added on to your Principal Residence Exemption for Real Estate property tax purposes.(Box 6b on PRE form) 

But I do agree you would not likely be able to claim any federal income tax relief unless it was sold at the same time as the rest of your primary residence.