All Forum Posts by: Stephen Hall

@Shazia Chiu It sounds like the smaller/older/sub $250k properties tend to cashflow best, based on what you and others are saying. I'll have to look more into them, thanks!

@Justin Hammond 20%. 25% would have yielded a better rate and (obviously) a lower payment, but wanted to keep a decent amount in savings to be safe.

@Jed Wood Seems like a lot of people acquiring new properties in Utah are going to the outskirts of town and/or outside UC/SLC, which makes total sense. I can definitely see the value there. The rise in interest rates from the time of going under contract to locking rate have caused my payment to go up about $100/month, which is one of the main reasons I've been getting nervous. This definitely doesn't seem to be the best investment I could have made, but I think it'll be a good opportunity to see how I like landlording before dealing with a house that constantly needs things fixed, etc. Re: AirBnB, really good point. I probably wouldn't have even looked at the HOA rules. It's something I will probably do later on (somewhere like Lake Tahoe where I can take advantage of it as a getaway myself), but I thought better of it for the time being. Plus, furnishing the house would cost a pretty penny.

@Jim D. 100% with everything you say...Seems to me that having a healthy mix of cashflow and appreciating properties in your portfolio is a good way to mitigate risk and maximize return....kind of like the stock market, I suppose. I grew up in the bay area in what has turned out to be one of the most ridiculously overpriced/overappreciated zip codes in the country...I never would have thought Utah would appreciate so much...it honestly freaks me out that I won't be able to afford to live here in 15 years. Re: your cashflowing rentals in the midwest, I always see the HGTV shows and have briefly looked at Tulsa, where I spent some time before....it seems that those properties cashflow well, but I assume there is very little appreciation...is that a fair assumption? Otherwise, aside from all the extreme weather, I would think that region would be overflooded with investors.

@Amy Kendall Yes, you are correct about the community I'm building in. It's a quirky little place (I live in the neighborhood as well), but the very low maintenance and close proximity to everything is really nice. I have heard the same thing about one renting for $2,000 (probably the model I am in as its the largest of the models, though not by much). I figure there are definitely renters willing to pay that price (or $1,850 as with the one I'm renting), but it is a much more limited market I think.

@Kyle Ransom I honestly never even considered that approach. It is not next door to a business park nor the slopes. Could be worth looking into, though. It does look like there are a few homes relatively near me with high occupancy rates on Airbnb.

@Andrew Johnson I appreciate the candid insight. Homes have appreciated since putting our deposit down and I suspect that will continue to be the case as they finish the last phase of the neighborhood. 

@Douglas Larson - Good point...The home I am buying is 305k (including upgrades and closing costs). 1850 sq ft, 3 bed/2.5 bath. I'll have another $5k or so for putting in a lawn and blinds. It's on a tiny .07 acre lot (there is no front yard, but there is a decent sized fenced in backyard). They are selling this same home now for about $320-325k on a new design/build. Projected rent = $1,850; PITI + HOA = $1690.

@Jay Helms - The goal is to continue acquiring additional rentals as quickly as I am able. As soon as I have enough equity to either cash out refi or sell and split those proceeds into multiple homes, I will. This is a retirement savings play - every penny gets reinvested until then. As I earn more in my day job, I may or may not use some disposable income to expedite it all. I am super risk averse, which is why I'm dipping my feet into REI with a brand new/low maintenance home.

Thank you, everyone. I can't tell you how helpful this is. Such an awesome community!

Thomas - 

I agree; no cashflow and no appreciation is a terrible investment. My market has been booming over the last several years as the tech scene has been increasing significantly. One can only make an educated guess at if the market will continue to grow, but it looks positive.

I expect there to be around $50-$100 left over after ALL projected expenses, so not much. I feel good about the purchase price (in fact, if I were to go design the same home now, it would cost $15,000 above what I am under contract for). I didn't put high end finishes on it, but we did put some decent upgrades in it (with the mindset of resell value, etc.)

The home requires very minimal landscaping/outdoor upkeep, while still being a SFH, which is one thing we really liked.

Hi All,

I am new to RE investing. We recently moved out of our first home in Lehi and bought two new properties in American Fork. One home is our primary residence (that we already live in) and the other is our first rental property that we are set to close on at the end of this month (it's a new build that we designed). The closer I get to closing, the more nervous I get.

Being a brand new home, I don't expect to have issues finding renters or having many expenses, but after setting aside ~$150/month for expenses/repairs/rainy day, I am really only banking on appreciation and mortgage pay-down. Is this a stupid plan? I always read on BP about how people are cash flowing crazy amounts, but I just don't see how you do that in Utah unless you are putting 50% down or have the right network to find under-market buys. 

This is all part of a passive, long-term retirement strategy, but I only had to put a small amount down, so I can still technically back out up until closing for a relatively small loss. Thoughts?