All Forum Posts by: Account Closed

You're a menace to society! You are literally the boogeyman to these people lol.

@Wendell De Guzman That's good to know. I use cap rate to estimate how much I'll be willing to pay for something without factoring in financing, but I'll start focusing more on coc and roi for these smaller properties.

Hey we're opposites!  My weak spot is going to be building rapport with distressed sellers. I suck at small talk and am not a very warm or empathetic person.  I come across as insincere when I try to be nice. When I try to prove my sincerity by being really nice I don't get taken seriously. What's worked best for me so far has been to be a hardass. It's something I'm continually working on though. 

I think there's a place in real estate investing for all personality types to use their strengths because there are so many aspects to it.

This is just for fun but I'm interested to see what kind of personality types are drawn to real estate investing.  Here's a test: http://www.16personalities.com/free-personality-te...

I'm istp :)

Assuming no significant future appreciation, in a C class area(or whatever class a blue collar rental market is), what's the cap rate you shoot for for a 2-4 plex?

The area I'm most interested in right now is a near Chicago suburb and I think I can get a 10% cap rate if I find a good deal on a distressed property and do a basic no frills rehab to get it rent ready. Since I'm inexperienced im not sure if I'll even be able to get anything that will give me the 10% cap rate, I'm only hopeful I'll be able to find something. Nothing in the area on the MLS right now is a deal that would work for me.

So I guess I have two questions. What cap rate would you shoot for in a stable C class rental neighborhood(they just got a Walmart and a new community center this year). And how much % cheaper than the MLS do you expect to find if you buy direct from a distressed seller?

Thanks in advance.

Thanks for the discussion everyone this is all very good input. I'm thinking it's just one of those things that needs to be continually adjusted based on your comfort level, market conditions, goals etc. at any given point in time.

Since my boyfriend and I both have decent income, we're planning on buying our first property distressed for all cash. Then creating value by rehabbing it and renting the units out. I think this will give us a solid footing to build our investing career off of. My question for this thread came when I was thinking how much we should cash out afterwards to roll into other investments, but I think the answer to that question will be more clear when the time comes. I don't want to get greedy with max leveraging but I don't want my money not working for me either.

I really appreciate all the perspectives and guidance.

I'm trying to reply to a thread and it's showing on my profile that I made these replies, but they're not showing in the thread. Hopefully they show up eventually but it doesn't end up with me having a bunch of duplicate posts.

@Paul C.  Thanks for figuring out my question. I don't really know how to ask questions sometimes when I'm just thinking, so I like to try to phrase it like a discussion starter I guess. I see what you mean about me still being on the hook anyways and I'm not actually reducing any risk by maximizing leverage.

I think it's just a psychological thing, about wanting my sweet cash in my hands. I suppose the smart way to look at it would be to make my decisions based on interest rates, and if I can make a higher return off my cash than I'm paying on the mortgage then I'd keep the mortgage(s).

@Paul Thanks for figuring out my question. I don't really know how to ask questions sometimes when I'm just thinking. I see what you mean about me still being on the hook anyways and I'm not actually reducing any risk by maximizing leverage.

I think it's just a psychological thing, about wanting my sweet cash in my hands. I guess the smart way to look at it would be to make my decisions based on interest rates, and if I can make a higher return off my cash than I'm paying on the mortgage then I'd keep the mortgage(s).

 Yeah, I guess max leverage would be the word. Over- and under-leveraging are both bad by definition. I just wanna see what people would be more comfortable with if they had to choose one.