All Forum Posts by: Martin Yung

@Duncan Lai

Hey Duncan, you can try areavibes, neighborhoodscout and city data to do your macro and micro research for a suitable investment market.

@Dawn Brenengen might be able to help you. 

Thanks everyone for the great advise, @Charles Worth @Rusty Scott@Nate Garrett thanks for reminding me on using IRR, indeed I have forgotten the principal pay down, thanks. You guys have convinced me.

Ya those numbers are proforma or past performance. Most funds started after the crash, around 2009. I believe that's how they get higher hostorical returns too. 

I have the same feeling as you where 1% rule hardly pencil out. 

Hi all, 

I couldn't get the numbers pencil out after looking at tons of B class and above turnkey properties, here's a hypothetical example. 

SFH 3/2

Turnkey price: $100,000

Monthly rent: $1,000 (most turnkey providers can hit the 1% rule)

Monthly Expenses:

Property tax : $100

Insurance: $50

Property management: $100 (10%)

Maintenance allowance: $100 (according to the blog written by Eric D. 10% is the minimum 12 “Hidden” Real Estate Expenses That Blindside Investors)

Vacancy: $50 (5% vacancy rate)

Leasing fees: $40 (approximately half month rent)

Mortgage payment: $405 (20% down, 4.5% fixed amortized at 30 years)

Monthly net income: $155 which translate to about 9% leveraged annual return. 

This is before income and federal tax. Besides, I have ignored CAPEX and eviction allowance. And My calculation barely break even for turnkey properties in Texas (high property tax and insurance premium)

My question is there are real estate related private equity funds that generate net of state income tax which yield around 8-9% per year, so I'm really in a dilemma to choose between the both options. Or should I go the traditional way and engage a realtor to find good deals? 

Does low to no appreciation market = low to no appreciation in rent? Most cash flow markets offered by turnkeys have low appreciation, my concern is will you be receiving the same rent 10 years down the road but repair cost has gotten up? 

@Kelley B. 

Check out this detailed discussion on love / hate for condo. I am also looking at condo as one of the cash flow option. 

http://www.biggerpockets.com/forums/311/topics/164031-condos-buy-and-hold-why-the-resentment

@Leo Qu 

There is an extensive discussion about the company in this tread. 

http://www.biggerpockets.com/forums/92/topics/126001-anyone-worled-with-profit-from-rentals