All Forum Posts by: Shane M

Property is still sitting, I'm watching comps in the area and nothing seems to be selling in this neighborhood. A lot of bank owned properties. I've been using Eppraisel and Cyberhomes for comps and there have been no changes. Anyone have alternatives that have worked for them?

I wonder if CNBC paid Cramer to take the heat for the whole mess, to detract from the fact that he isn't the only person at fault, why else would he volunteer to be humiliated? Strange

Hey Tiara, I appreciate your enthusiasm for success, but with only so much time in a day you will probably have to (if you aren't already) pick and chose as to what your focus is going to be. I'm not saying you can't do all of those things, but you will probably save time by focusing on one, becoming experienced at it, then focus on another.

As franklin mentioned it would help you to get good credit and stable income before you get involved in RE investing. That's not the only option, but it is a reasonable one. You could finish your degree, get a job in one of the industries you mentioned (which will help you become a real pro at that industry) and using your income invest in RE on the side.

You could try to start your own company in any of the industries you mentioned, but without experience in them, I'm not sure how you would grow your client base, etc. Of course this could just be ignorance on my part.

Good luck!

Nichola, when it comes to renting out a property a good tool newbies (like myself) use to calculate if a rental property is a potential deal is something called the 50% rule.

Realistically if you are renting out any property you are going to have unexpected expenses (repairs), months of vacancy, property taxes, etc. The 50% rule is simply taking your rental income and cutting it in half to account for all of those misc. expenses EXCEPT the mortgage payment. The mortgage payment is subtracted after you take the 50%. Then you arrive at your "cashflow" number, which is effectively how much you will make or lose on the property every month.

In your situation:
2600/2 = 1300
1300 - 2500 (mortgage)
= -1200 of cashflow

So I would have to agree you want to get out of this property ASAP. Every month you stay, you lose more money. Your house would then have to appreciate by 1200 each month in order to make up for these massive losses.

Now the 50% rule is more of a guiding tool, but in your case it is clearly a bad deal.

In this type of financial environment, people are angry and are always looking for a good outlet for that anger. Cramer was the outlet this time around.

Not that Jon Stewart was wrong (the fact that Jim Cramer has a show about making money without much work besides listening to him screams scam). But Jim Cramer is just the face of a much bigger accountability problem.

CNBC and much of the popular financial media have been pushing long-term investing (by setting aside X amount of dollars and giving it to the financial companies to manage for you in whatever mechanism exists) for a long time. Trust us with your money and we will earn you 10-25% a year without any work required from you. That sounds like a scam too, doesn't it? And then in the background you have these companies manipulating the funds that ordinary people entrust to them.

If you are going to invest your money in the stock market, you should plan on keeping yourself informed about what you have your money in and how those companies are performing. Otherwise find another mechanism of investing that you can monitor.

I think a much wiser investment, and one that you would have a lot more control over would be starting a business. Sure, you may fail, but if you learn from your experience in the long-term you will succeed. And for the most part you control your own success.

"The banks pricing seems to have very little to do with logic and more to do with what they have "in" a house."

Yes, sometimes banks need to leave their houses on the market to remind themselves that what they want isn't necessarily what the house is worth!

I've read posts about the "worst house on the block" in a good neighborhood, is that what most of you would consider ideal? Granted all of the other factors worked out. What are some of the benefits of this situation. I would think:

1) Bigger margin because you buy in cheap b/c of rehab but also comparing to nearby comps
2) Better chance of selling sooner

Anything else you can think of? Any disadvantages?

Hey David, I'm over in Ann Arbor, not too far away, are you looking for anything in particular?

Good question, in fact the completely stripped bathroom, could that be left out of the square footage?

It is a pretty standard size for the neighborhood though