All Forum Posts by: Stephen E.

I live in Nola and will definitely go.

You can do better than that in Jackson Mississippi. But appreciation is unlikely. At the same time, I like Jackson as it's the capital of the state, so it's not going to disappear. You can buy a house for $30,000 in Jackson that rents for $600, easily.

Looking forward to it.

Let me know when you arrive. We'll get coffee and talk real estate!

Difficult decision. Timing the market is a difficult beast, inexact at best. The market will likely go lower than it is now, but one day it will certainly be higher.

One thing NOT to take into consideration is how much money you put in. The only thing to think about is how much you could take out and what next step makes the most money. The amount of money put in is a meaningless statistic, good for grading yourself but no actual relevance when it comes to deciding what to do next.

The question for me would be how much equity can you pull out vs. selling. If you're able to pull out enough equity without going into a place of negative cash flow then it's probably worth keeping. Obviously you want that equity to invest so I don't think just leaving the equity in those properties makes sense. But in similar situations I've been able to pull enough equity out either through refinancing or portfolio loans that it's made sense to keep the properties. I lean toward keeping all properties, but it's more of a personality preference than anything else.

However, if it wasn't for refinancing I definitely would have sold my primary residence.

This is great. Congratulations! I would love more information from this post. I'll search and probably figure out a lot myself but I'm going to ask anyway. What is the MIH Mastermind Group? What is the Wheelbarrow Profits platform?

I'd love to know the backstory on how you found this property. Did you work with a realtor? Was the property listed on the MLS? Curious about your processes.

Wishing you success in your endeavors.

Hi Gabriel, good question.

I have both in state and out of state. I got involved in out of state after I got connected to a property manager I really liked. That gave me the confidence to invest in inexpensive cash flowing properties in Mississippi. But I don't think it's a requirement. A bad property manager is a true nightmare, something I saw happen to a neighbor of mine.

Dallas seems like it might be kind of expensive, but it depends on your capital. You can get a single family home in many areas for $40,000 that's in good shape and rents for $800 a month. You'll have to buy it outright, banks won't loan on property that costs less than $60,000 (ymmv) but if you get a couple of them you can go back to the bank and refinance them as a portfolio loan and get a lot of your money out.

So depending on your capital that could be a good way to get started in out of state. Those would be C class properties generally at that price point but as long as you have a good property manager it won't be a headache.

Another consideration is that cheap property often cashflows well but doesn't appreciate, so it's a very conservative investment. Hard to lose money but also hard to hit it out of the park.

Good luck!

@Carlos Ptriawan I was renting the entire building, which was a decommissioned storefront with an owner's unit above. Again though, it was a commercial lease. I had the entire building at a set price for 6 years, which is why it made sense for me to put money into the building. In a commercial lease it's common for a renter to spend money fixing up a building. Totally different from a residential lease. Many commercial leases fix the rent for 10 years for that reason.

@Emily K. I have done this. It can be done ethically and legally. Landlords really don't like it when you do it without their knowledge. But that's not the question you are asking.

There was a commercial building for rent in New Orleans. The zoning was commercial so I was able to do short term rentals legally, but it needed a lot of work. Like, I had to install a tile floor, a bathroom. The building owner was well aware of my plans from the beginning. And he was so happy because I was putting money into his property.

We did a commercial lease on the property, which is the right kind of lease for this arrangement. Commercial leases are different in many ways from residential leases. This was a 6 year lease that was triple net, meaning it adjusted if the property taxes were raised, stuff like that.

I put about $20,000 into making the place rentable and I made tremendous profits on the building. Everyone was happy. In the end I did end up purchasing the entire property from the landlord as he decided to move.

One more thing. I have some single family rentals and I have written into the lease rules for my tenants if they want to do short term rentals. They basically have to make me aware of the dates they will be doing it and pay me 20% of what they charge for the rental in addition to the regular monthly rent. Again, everyone wins with this. I'm not sure if I will continue to do that, and none of my renters have taken me up on it yet. They would be required to get permits with the city and do it legally, so, that's a part of it.

Anyway, don't listen to people who say it can't be done, or that no landlord would ever let you do it. There are no absolutes in this business.