All Forum Posts by: Steve Michaels

No, actually, you don't. Your continued belief that your JV partner is suddenly, after hundred's of failed attempts, going to execute on what he says means you still don't actually get the problem here.

I don't know, where the last 30 stories he told you BS?  Why would it change now?

Originally posted by @John Pruner:

Seriously?  You think he is suddenly going to go above-and-beyond when he hasn't executed on the basics?

Originally posted by @John Pruner:

I might suggest that that statement deserves the most attention of your entire post.  You have repeatedly asked for advice on "how to get out of the deal" and you haven't really taken any of them to heart.  

You still think you are going to get something out of this deal.  YOU AREN'T.  The money you have in is sunk cost and you are potentially on the hook for more money since you are on title.

First order of business:  have a couple cold ones and repeat:  "That investment is gone, I can't get it back."  Then:

- Stop talking to the JV partner
- Send a check to the BP good Samaritan that is willing to be your eyes and ears and implore them to secure the house, take full documentation pictures and video
- Call a lawyer

I know it sounds harsh, but you need to first let go of the investment.  Once you do that, anything you might get back is gravy.  But it is likely gone.  Chalk it up to experience.

Long time lurker, first time poster… let me start by saying a big thank-you to everyone here for what I’ve picked up over the last few months – very valuable resource. Sorry for the long lead-up to the question…

I’ve been investing full-time for a few years, have flipped a bunch of properties, and have acquired a number of rentals. Wife works a lucrative day job but really doesn’t want to do it anymore. We’ve got a good chunk of liquid retirement assets, a good chunk of in-process flipping assets, and a lot of equity in our primary residence.

… and then we’ve got the rental portfolio. Let’s say it generates $35k a year of after-repair free cash flow. In theory, that is roughly equivalent to having another $1m invested in the bank (assuming you can conservatively draw at 3.5% - I know, huge assumptions here).

Theoretically, if we were to sell the flipping portfolio, put that money in the bank and stop working, we could roughly count on a 3.5% return on the bank assets, plus the $35k a year from the rentals.

Where the problem starts is that the wife wants to see “the value” of the rental portfolio and the primary residence somewhere in “the number.” I respond that we don’t sell the rental portfolio or we lose the income (true), but since we don’t have any kids she insists that the underlying equity in the rental portfolio needs to be considered in the model as we aren’t going to take them with us (also true).

Long way around: how do I value the residual value of the rental portfolio as I think about retirement? There will be a time when I don’t want to deal with them and we sell them, but I’m struggling with how I reflect that in a future retirement model.

Does that make any sense?

Thanks in advance!

Steve