The Entrepreneur Forum | Startups | Entrepreneurship | Starting a Business | Motivation | Success

Thoughts on my RE portfolio

Remove ads while supporting the Unscripted philosophy...become an INSIDER.

GetRichODT

Contributor
FASTLANE INSIDER
Read Millionaire Fastlane
Feb 8, 2015
280
96
57
44
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

I'm still working and can put away about $10,000 per month in after tax.

I have after tax assets of about $300,000.

Right now I'm not too comfortable with the amount of mortgage loans I have with total mortgages being more than twice my cash mortgage position.

Paying no extra on the mortgages I reduce my mortgage by about $1,050 each month. That amount increases about $5 / month with each passing month.

What am I doing well?

Wrong?

What would you do differently?
 

Don't like ads? Remove them while supporting the forum. Subscribe.

biophase

Legendary Contributor
EPIC CONTRIBUTOR
FASTLANE INSIDER
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Jul 25, 2007
7,374
34,265
5,083
Scottsdale, AZ
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

I'm still working and can put away about $10,000 per month in after tax.

I have after tax assets of about $300,000.

Right now I'm not too comfortable with the amount of mortgage loans I have with total mortgages being more than twice my cash mortgage position.

Paying no extra on the mortgages I reduce my mortgage by about $1,050 each month. That amount increases about $5 / month with each passing month.

What am I doing well?

Wrong?

What would you do differently?

If you aren't comfortable you can:
1) Start to pay down your highest interest rate mortgage
2) Sell one property and use the proceeds to pay down/off a mortgage

I don't think you are way out of line. But if you feel that property values might go down or you will have more vacancies or maintenance expenses coming up, then maybe it is time to sell one.
 

Real Deal Denver

Gold Contributor
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Jan 13, 2018
879
2,088
547
66
Denver, Colorado
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

I'm still working and can put away about $10,000 per month in after tax.

I have after tax assets of about $300,000.

Right now I'm not too comfortable with the amount of mortgage loans I have with total mortgages being more than twice my cash mortgage position.

Paying no extra on the mortgages I reduce my mortgage by about $1,050 each month. That amount increases about $5 / month with each passing month.

What am I doing well?

Wrong?

What would you do differently?

Why are you in real estate to start with?

I am too, and I'll give you my reasons. I can leverage. If I have 20K, how much can I buy in stocks or bonds? 20K. How much can I buy in real estate? 200K. Ten times more.

With leverage, comes multiplying factors of gain. I do very well with my 20K of stocks, and they go up 12%. That beats the market, as MJ so well puts in his Fastlane book (which is reason enough to NOT go into stocks, but he said it so well so I won't repeat it here). I make $2,400. Wow. I can now buy that nice set of tires for my Lambo. I sure can't buy the Lambo, but hey - one step at a time...

My real estate does fairly well too. It goes up half that amount in market appreciation. I now have 6% of 200K, which is $12,000. Or put another way, about FIVE times more than I luckily made in the stock market getting TWICE the returns.

In real estate, it is all real. Nobody is going to merge, dissolve, or declare bankruptcy - unlike the directors of the companies that I invest in that I know nothing about. You want to put your fate in the hands of people that you know nothing about? Fine - call ME - I'll do it for you and pay you much better than they will!

Now, let's factor inflation. Let's say you are getting $2,100 a month, after expenses. Oh, you did say that - good. Your rents increase 5%. Whoa - that's what the stock market people HOPE they can get. Anything beyond that is gravy. You already have that with your rent alone. Sure it's not a lot, but it's $105 off your house payment, which is a start. Next year, it could be another $105 a month. In a million years, it will big money - too bad you won't be here to enjoy it... You get the point. I said that to counter you saying that it's nothing. Yes, it is something. Add in your market appreciation of 5 or 6% (getting that here in Denver for the past several years), and you have the market appreciation of which I spoke of ealier, of $12K or so.

So, what to do? Invest in stocks, or even worse, park it in your 401K? You said you could put away $10K a month. For what? For a pissy 2% gain, if even that much? You should pray that you can keep up with inflation if you're in that game.

No.

Pay off your real estate as fast as you can. Everything I've said so far explains why. Or, plan B - get more real estate. I'd concentrate on paying it off, while sitting on the sidelines for the great property you may encounter here and there with the golden ROI. For a super shot of income, go the flipper route. Or combine them. Fix but don't flip: rent. Any way you cut it, it's like shooting fish in a barrel. You can't lose. Well, you can, but it takes a lot of skill to do that, actually. Some manage, though.

There you go. If you find something - anything - better than real estate, let me know. I sure don't know what that is, other than the possible home run from launching my own Fast Lane business venture. And that's, exactly, why I'm here. But that, whatever it may be, is not going to withstand the test of time like real estate will. My next great thing will be copied, lose its luster, and eventually just fade away. Real estate will be here a hundred years from now, still an ATM machine, cranking out money, month after month.

I didn't even TOUCH on the two year no capital gains rule. That alone is how some savvy people pay off their homes in eight years or less!
 
Last edited:

JohnD Realestate

Making Real Estate Great Again.
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Dec 23, 2017
118
227
162
47
Chappaqua
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

I'm still working and can put away about $10,000 per month in after tax.

I have after tax assets of about $300,000.

Right now I'm not too comfortable with the amount of mortgage loans I have with total mortgages being more than twice my cash mortgage position.

Paying no extra on the mortgages I reduce my mortgage by about $1,050 each month. That amount increases about $5 / month with each passing month.

What am I doing well?

Wrong?

What would you do differently?


Not sure anyone could answer this question for you.....as well as you can.

It sounds like you have 300k in equity, so that’s about 64% debt. I might have read it wrong.

In 2007-2012 I had a property with similar cash flow. The mortgage amount- 714. Over 5 years the equity went from 5% -20% back up to 20%. The equity numbers never really meant too much to me(looking back) as the property was paying its bills.

For about 5 years I paid down the mortgage. I got it down to the low 600s. In hindsight it would have been better to buy another property. But that not how things work.

I’m not saying you should do what I do...here is part of my plan.
Right now I am 55% leveraged. But my plan is to cash out refi and build a larger portfolio.

What helps me sleep Is that I look at a lot of properties. I buy at a discount, mostly off market. With solid cash flow. That way what I’m buying can pay the bills during a downturn.

I have a spreadsheet I use to compare income properties if you need one. I can either upload it here or DM me.
 

ZCP

Legendary Contributor
Staff member
EPIC CONTRIBUTOR
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Oct 22, 2010
2,912
10,057
2,456
Woodstock, GA
We'd love to see your sheet!
 

JohnD Realestate

Making Real Estate Great Again.
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Dec 23, 2017
118
227
162
47
Chappaqua
We'd love to see your sheet!

Thanks for your generosity! Please double check the formulas before using. I’m a hack with computer programs. I got a template of this off Www.biggerpockets.com and then tinkered a bit.

I don’t have a clean copy handy, but I do have the sheet I was using a few months back. The maintenance looks more like 10-12% right now but this is a cold winter up here and I had a lot of frozen pipes, emergency plumber calls etc. my last property 400$ per unit a year was fine. Note: that was all gut renovated with a higher class tenant. That’s always my long term plan. Buy poorly managed properties with hidden value, stabilize, renovate as units become vacant.

I am also at 10% vacancy up here at the moment. That’s due mostly to poor management from prior owner and a bit of my own poor choices. Long term 5% should do with proper screening.

I’ll dig up another copy that has a hard money calculator in as well.

Edit: some of the numbers like insurance are my own quotes others are a formula I use after seeing a pattern and running lots of numbers. Taxes I check, but utilities is a lot tougher. For instance if some one uses oil heat you can ask for the bill but they can easily fake that number by taking a cash delivery or putting diesel into the tank. For public utilities like water/sewer/sanitation...I can foil the municipality during DD. But electric and gas I’ve never had much success at seeing actual bills in this price range. Million dollar houses they will have bills. 50k houses the bills are probably still in the junk drawer and I’ll never see them.
Very important to remember(or learn the hard way) is many sellers fabricate the best case scenario, even if they don’t they could forget an expense. That’s where the sheet comes in handy. I can compare to other properties I own which I always keep on the sheet and look for outliers.

In other words keep the BS detector set to loud and sensitive.
 

Attachments

  • Property_Comparison_Newburgh.xlsx
    96.1 KB · Views: 25
Last edited:

GetRichODT

Contributor
FASTLANE INSIDER
Read Millionaire Fastlane
Feb 8, 2015
280
96
57
44
Still plugging away. I’ve not made any extra payments as my loans are all well below prevailing rates.

Each month now I’m paying off an additional $100 of the mortgages just as time passes by.
 

biophase

Legendary Contributor
EPIC CONTRIBUTOR
FASTLANE INSIDER
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Jul 25, 2007
7,374
34,265
5,083
Scottsdale, AZ
Still plugging away. I’ve not made any extra payments as my loans are all well below prevailing rates.

Each month now I’m paying off an additional $100 of the mortgages just as time passes by.

It all depends on what you are doing with the money you aren't using to pay down the mortgages. I used to pay some round number, like if my mortgage was $798, I'd pay $1000 a month. What I also did was sometimes pay chunks off like $5000, $10000. It would greatly increase the principle pay down. But this year, I just went ahead and paid them all off. This is because I had the cash sitting in the bank at .5% interest and I wasn't doing anything with it, so it made no sense to keep pay 3.5%-4% for no reason.
 

Real Deal Denver

Gold Contributor
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Jan 13, 2018
879
2,088
547
66
Denver, Colorado
But if he pays off the debt he is also loosing the leverage.

You are absolutely right - which is why I said "or"...

I stated it that way to make a point, but I could have done that better I see.

YOU are thinking the way rich people think. That's where it all has to start. As @JohnD Realestate stated - he should have bought more real estate rather than paying his mortgage down.
 

Real Deal Denver

Gold Contributor
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Jan 13, 2018
879
2,088
547
66
Denver, Colorado
It all depends on what you are doing with the money you aren't using to pay down the mortgages. I used to pay some round number, like if my mortgage was $798, I'd pay $1000 a month. What I also did was sometimes pay chunks off like $5000, $10000. It would greatly increase the principle pay down. But this year, I just went ahead and paid them all off. This is because I had the cash sitting in the bank at .5% interest and I wasn't doing anything with it, so it made no sense to keep pay 3.5%-4% for no reason.

Wha Wha Wha WHAT?

You paid off a 4% loan? Come on @biophase - you had to have been able to find something to do with that money instead of letting it sit, or paying off cheap money !

I think my brain is bleeding! I can't stand the pain! Tell me you didn't do that.

If you find yourself with a cool 2-3 hundo thou, let me know. I'll get you some hot real estate in Denver. I just had a deal slip through my hands a week ago. Selling a home to be torn down in the hottest part of town. It was listed at $425K - sold in a few hours - and somebody is going to walk away with maybe 1-2 hundo thou by selling it to a builder, who will tear it down and put up a 2-3 mill home, and make a mill himself! Damn - I DO get to go to the ball, but I have leave before it's over or I'll turn into a pumpkin. And the next day, all I hear is how great the party was!

My fault - I need to have buyers lined up to grab things like this when they come along. It sure was a slap and a kick in the face wake up call.

I need someone to make me rich, doing nothing but writing a check. I wanna make 100K every month - so make me feel guilty and tell me I'm greedy... I've been called a greedy little bastard before, but the truth is I'm really not that little.
 

Don't like ads? Remove them while supporting the forum. Subscribe.

Suzanne Bazemore

Silver Contributor
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Sep 30, 2018
444
967
339
@JohnD Realestate , thank you for sharing your spreadsheet for cost comparisons. I haven't invested in real estate yet, but I would like to, and I had made a spreadsheet for comparison but yours is better.
 

Suzanne Bazemore

Silver Contributor
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Sep 30, 2018
444
967
339
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

2) Sell one property and use the proceeds to pay down/off a mortgage

Obviously, I am not familiar with your properties or your market, but you are feeling uncomfortable with the amount that you are leveraged. Something is making you feel that way - and you know your own market. If you think your market is going to take a hit, then you can do what @biophase suggested and ditch one and use it to pay for the others. Sometimes properties are worth more than you can get out of them in rent. Do you have a property like that - that lies in an area where the value outside of rent might have rapidly increased? Maybe you could sell it before the bubble pops, if there is a bubble where you are.
 

JohnD Realestate

Making Real Estate Great Again.
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Dec 23, 2017
118
227
162
47
Chappaqua
Still plugging away. I’ve not made any extra payments as my loans are all well below prevailing rates.

Each month now I’m paying off an additional $100 of the mortgages just as time passes by.
Wha Wha Wha WHAT?

You paid off a 4% loan? Come on @biophase - you had to have been able to find something to do with that money instead of letting it sit, or paying off cheap money !

I think my brain is bleeding! I can't stand the pain! Tell me you didn't do that.

If you find yourself with a cool 2-3 hundo thou, let me know. I'll get you some hot real estate in Denver. I just had a deal slip through my hands a week ago. Selling a home to be torn down in the hottest part of town. It was listed at $425K - sold in a few hours - and somebody is going to walk away with maybe 1-2 hundo thou by selling it to a builder, who will tear it down and put up a 2-3 mill home, and make a mill himself! Damn - I DO get to go to the ball, but I have leave before it's over or I'll turn into a pumpkin. And the next day, all I hear is how great the party was!

My fault - I need to have buyers lined up to grab things like this when they come along. It sure was a slap and a kick in the face wake up call.

I need someone to make me rich, doing nothing but writing a check. I wanna make 100K every month - so make me feel guilty and tell me I'm greedy... I've been called a greedy little bastard before, but the truth is I'm really not that little.


Have you worked on finding and having a good relationship with a hard money lender?

If your that confident that the deal has meat on the bone it’s the perfect scenario for a HML.

Biggerpockets has a list of HML.

When I needed one I just called every one in my state and then weeded through. Jus be aware the more deals you do the easier it becomes to get money bc they think you can’t lose.....bc youve done deals and not lost.
 
Last edited:

biophase

Legendary Contributor
EPIC CONTRIBUTOR
FASTLANE INSIDER
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Jul 25, 2007
7,374
34,265
5,083
Scottsdale, AZ
Wha Wha Wha WHAT?

You paid off a 4% loan? Come on @biophase - you had to have been able to find something to do with that money instead of letting it sit, or paying off cheap money !

I think my brain is bleeding! I can't stand the pain! Tell me you didn't do that.

Sure there are plenty of things I can do with my money. The constraint isn't money, it's time. I'm sure I can use it to start a business right? Well I started 2 last year and am starting 3 more next year. It's not like each business takes $100k to start. So what did I do with some of it? Well I bought a car. :)

If you find yourself with a cool 2-3 hundo thou, let me know. I'll get you some hot real estate in Denver. I just had a deal slip through my hands a week ago. Selling a home to be torn down in the hottest part of town. It was listed at $425K - sold in a few hours - and somebody is going to walk away with maybe 1-2 hundo thou by selling it to a builder, who will tear it down and put up a 2-3 mill home, and make a mill himself! Damn - I DO get to go to the ball, but I have leave before it's over or I'll turn into a pumpkin. And the next day, all I hear is how great the party was!

My fault - I need to have buyers lined up to grab things like this when they come along. It sure was a slap and a kick in the face wake up call.

I need someone to make me rich, doing nothing but writing a check. I wanna make 100K every month - so make me feel guilty and tell me I'm greedy... I've been called a greedy little bastard before, but the truth is I'm really not that little.

How did this deal slip through your hands exactly?

You aren't really selling your ability to find deals here. I run away from anyone who presents any business or investment opportunity this way.
 

Real Deal Denver

Gold Contributor
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Jan 13, 2018
879
2,088
547
66
Denver, Colorado
If your that confident that the deal has meat on the bone it’s the perfect scenario for a HML.

I have HML's that I am in contact with. They are not the be all solution to everything. They can't move fast. Takes them from 2 days to a week to make a decision. They don't have a shortage of clients, so it's hard to get them excited enough to jump. They're still on my list - they may come in handy, despite their high costs...

How did this deal slip through your hands exactly?

You aren't really selling your ability to find deals here. I run away from anyone who presents any business or investment opportunity this way.

My screen name is Real Deal. I don't know everything, and I have made mistakes. I admit those to anyone - but I also tell them that I am constantly improving too. One of the main things I "sell" about me is my honesty and laying out the facts as they are. I don't sugar coat things, and if I don't know something, I'll tell someone that. I detest the flashy know everything types, so I go out of my way to be as genuine as I can be.

How did I lose this deal? I don't have an "army" of strong buyers built up. I'm working on that though. My strongest ones are not liquid all the time. My liquid ones are not strong enough some of the time. I know there are perfect buyers out there that can turn on a dime and make a decision within minutes (not days). One of my goals is to have an assortment of clients like this that I can call on a moments notice to do a deal. And that's how I lost the deal - someone else discovered its great potential and DID have the ability to turn on a dime. Well, it's not the first, and it won't be the last, deal that I saw walk away from me. It's kind of painful because this one was particularly meaty.

But - there's always one coming. I'm branching into wholesaling directly and therefore will be in control - which will eliminate the horse race that some deals turn into.

Speaking of running away... big mistake there. I have not met a lot of people that I truly admire. But one guy I know is particularly unusual in that he is as close to a natural born winner that I have ever seen. They guy has laser beam focus and he's unrelenting. Sure he has made a lot of mistakes along the way, and missed opportunities too. He freely talks about them and doesn't make excuses. I like that he has learned from his mistakes and that he's open and honest about them. Sometimes the "losers" that talk about how they lost are really the strongest ones out there. This guy - Louie - is a dangerous and formidable competitor. He doesn't lose too much anymore. As you might have guessed, he doesn't put on airs, and is an all around "regular" guy - that just happens to be a superstar - but he doesn't let that go to his head ever.
 

biophase

Legendary Contributor
EPIC CONTRIBUTOR
FASTLANE INSIDER
I've Read UNSCRIPTED
Summit Attendee
Speedway Pass
Jul 25, 2007
7,374
34,265
5,083
Scottsdale, AZ
How did I lose this deal? I don't have an "army" of strong buyers built up. I'm working on that though. My strongest ones are not liquid all the time. My liquid ones are not strong enough some of the time. I know there are perfect buyers out there that can turn on a dime and make a decision within minutes (not days). One of my goals is to have an assortment of clients like this that I can call on a moments notice to do a deal. And that's how I lost the deal - someone else discovered its great potential and DID have the ability to turn on a dime. Well, it's not the first, and it won't be the last, deal that I saw walk away from me. It's kind of painful because this one was particularly meaty.

Here is the reason I asked... your language said that you that "I just had a deal slip through my hands a week ago.", but you really didn't. You didn't have the means to close the deal so it never slipped through your hands. You did not have a buyer lined up. You did not have the means to close this deal. Did you make an offer on it at all? Maybe next time put an offer at $475,000 with $10,000 non-refundable earnest money to close in 15 days? Then go find a buyer?

Please see it from another perspective. I see the same deal as you on the MLS, I call MJ and tell him it's a great deal and I need $450,000 to close in 7 days. MJ says no thanks. Did I really just miss that deal?

What I'm getting at is that you feel that you just missed a deal, where in reality you were just as far away from it as I was. You have to be in the game to miss a deal. This is a mindset thing where in your brain you feel like you are always missing out, where in reality you weren't in the game to start with.

I see this alot when people think they have bad luck, or no luck, when in reality they had 0% chance at every step of the way.

You just saw a great deal on some property and someone else bought it. My definition on missing a deal, is that you make a solid offer, equal to that of another buyer and the seller picks the other buyer.
 

JohnD Realestate

Making Real Estate Great Again.
FASTLANE INSIDER
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Dec 23, 2017
118
227
162
47
Chappaqua
I have HML's that I am in contact with. They are not the be all solution to everything. They can't move fast. Takes them from 2 days to a week to make a decision. They don't have a shortage of clients, so it's hard to get them excited enough to jump. They're still on my list - they may come in handy, despite their high costs...



My screen name is Real Deal. I don't know everything, and I have made mistakes. I admit those to anyone - but I also tell them that I am constantly improving too. One of the main things I "sell" about me is my honesty and laying out the facts as they are. I don't sugar coat things, and if I don't know something, I'll tell someone that. I detest the flashy know everything types, so I go out of my way to be as genuine as I can be.

How did I lose this deal? I don't have an "army" of strong buyers built up. I'm working on that though. My strongest ones are not liquid all the time. My liquid ones are not strong enough some of the time. I know there are perfect buyers out there that can turn on a dime and make a decision within minutes (not days). One of my goals is to have an assortment of clients like this that I can call on a moments notice to do a deal. And that's how I lost the deal - someone else discovered its great potential and DID have the ability to turn on a dime. Well, it's not the first, and it won't be the last, deal that I saw walk away from me. It's kind of painful because this one was particularly meaty.

But - there's always one coming. I'm branching into wholesaling directly and therefore will be in control - which will eliminate the horse race that some deals turn into.

Speaking of running away... big mistake there. I have not met a lot of people that I truly admire. But one guy I know is particularly unusual in that he is as close to a natural born winner that I have ever seen. They guy has laser beam focus and he's unrelenting. Sure he has made a lot of mistakes along the way, and missed opportunities too. He freely talks about them and doesn't make excuses. I like that he has learned from his mistakes and that he's open and honest about them. Sometimes the "losers" that talk about how they lost are really the strongest ones out there. This guy - Louie - is a dangerous and formidable competitor. He doesn't lose too much anymore. As you might have guessed, he doesn't put on airs, and is an all around "regular" guy - that just happens to be a superstar - but he doesn't let that go to his head ever.


My hard money lender and I have a good relationship i know what he will do and not do. If he won’t do a deal for the most part it’s not a deal that I would want to do. And I’ve done stuff that’s lost money before. He knows that.

I don’t ask him anymore if he’ll do a deal I ask him how much he can discount rate and points. Don’t get me wrong I do ask him what he thinks but I don’t bring any dogs to him. If it’s not a great deal i let it pass. 12/3 is normal around here.....I don’t pay that anymore. I’m borrowing at less than 10.75 all in except closing costs and attorneys.

If your asking other people for money like OPM your talking equity partners? I would think they are more expensive meaning at the end of the deal they’re talking a bigger piece...I could have that wrong but usually debt is safer=less return. equity is riskier bc they take equivalent losses or gains depending on your split.

As far as moving quickly I do it a bit different. I don’t ask a HML for a decision before i put in an offer. If I’m looking in the market in a certain price range than I usually have at least 15-20% in cash and sometimes up to 100% or more. I’ve been sending him emails about what I’m lookimg at. Telling him when I put offers in and at what #s just asking his opinion.

I put in an offer it’s usually immediately upon seeing a property. cash offfer no inspection contingency bc I do that myself and I have my own strategy. Depending on what they counter. I make a good amount of offers but by no means bs offers. Usually my offer will be low enough that a HML will jump all over it. If offer Gets accepted I send it to my attorney call the HML and we get an appraisal. The appraisal should be in line with my own rough #s. If it’s not I messed up or I disagree with the appraisal. Doesn’t happen to often lately. It takes practice. I was really far off on a few a year and a half ago but not on the ARV....So I bought the house but then ran out of cash during rehab. That’s changed.

My last 3 deals

My ARV 250k. Appraised at 235k 45k+112 rehab=157k all in.

My ARV 120. appraised at 120k 75k purchase +15k rehab. I sold it for 134k so I say I was right.


My ARV 250. appraised at 245k
79k purchase +100k rehab=179


No grand slams. I’m never really too much more than 25k into them I rent them out and when refi is complete only leaving what I have too.

I keep a close eye on what’s selling within 90 days. I discount out the highest and lowest and I don’t reach far for numbers.
 
Last edited:

Real Deal Denver

Gold Contributor
Read Millionaire Fastlane
I've Read UNSCRIPTED
Speedway Pass
Jan 13, 2018
879
2,088
547
66
Denver, Colorado
Here is the reason I asked... your language said that you that "I just had a deal slip through my hands a week ago.", but you really didn't. You didn't have the means to close the deal so it never slipped through your hands. You did not have a buyer lined up. You did not have the means to close this deal. Did you make an offer on it at all? Maybe next time put an offer at $475,000 with $10,000 non-refundable earnest money to close in 15 days? Then go find a buyer?

Please see it from another perspective. I see the same deal as you on the MLS, I call MJ and tell him it's a great deal and I need $450,000 to close in 7 days. MJ says no thanks. Did I really just miss that deal?

What I'm getting at is that you feel that you just missed a deal, where in reality you were just as far away from it as I was. You have to be in the game to miss a deal. This is a mindset thing where in your brain you feel like you are always missing out, where in reality you weren't in the game to start with.

I see this alot when people think they have bad luck, or no luck, when in reality they had 0% chance at every step of the way.

You just saw a great deal on some property and someone else bought it. My definition on missing a deal, is that you make a solid offer, equal to that of another buyer and the seller picks the other buyer.

Yeah, you're right. Thanks for the insight. I'm in the game - gotta ramp up and be a player. I know the game. And I know players that don't know how to play the game. Gotta make those matches made in heaven happen!
 

Michael Burgess

Bronze Contributor
Speedway Pass
Sep 30, 2014
161
445
210
26
Ontario, Canada
I own several properties and am trying to determine my plan for the next 5 years.

I owe about $800,000 in mortgages.

I net about $2100/month total on the portfolio after all expenses.

I'm still working and can put away about $10,000 per month in after tax.

I have after tax assets of about $300,000.

Right now I'm not too comfortable with the amount of mortgage loans I have with total mortgages being more than twice my cash mortgage position.

Paying no extra on the mortgages I reduce my mortgage by about $1,050 each month. That amount increases about $5 / month with each passing month.

What am I doing well?

Wrong?

What would you do differently?

Given how much you owe, and how much you're producing in cashflow after all of your expenses, I'm wondering:

Is there another geographic market within reach for you that would provide better cashflow with the same capital?

Could you liquidate your lowest performing properties, do a 1031 exchange into better casflowing properties, and put yourself in a position where you're more comfortable with the debt?

Are you currently working on any projects where you can force appreciation by renovating the property?

Just a few thoughts!
 

Sponsored Offers

  • Sticky
MARKETPLACE Fox Web School "Legend" Group Coaching Program 2020
Hi Fox, After reading your threat and watching some of your youtube I have several query ? 1...
  • Sticky
MARKETPLACE Lex DeVille's - Advanced Freelance Udemy Courses!
If you read the last message then you know I'm removing my courses from Udemy next month. You...
  • Sticky
MARKETPLACE Grow Your Business With a Book (An Unorthodox Marketing Strategy That Built One of the Largest...
PS. what do you think about the idea of setting up live Busking experiences on Air BNB? I could...
  • Sticky
FEATURED! Introducing... WEALTH EXPO$ED, A Short Story By MJ DeMarco
Hi Mj, I just bought it. And reading it. I think is a great idea to write using the stories to...
  • Sticky
MARKETPLACE You Are One Call Away From Living Your Dream Life - LightHouse’s Accountability Program ⚡
Just got off the phone with @LightHouse. Having just a 45 minute conversation with him has...
  • Sticky
MARKETPLACE Kill Bigger Incubator
@Kak Thanks for the reply. Whats interesting is that I have an idea that's been cooking which...



Forum Sponsor

sponsor

Fastlane Insiders

View the forum AD FREE.
Private, unindexed content
Detailed process/execution threads
Monthly conference calls with doers
Ideas needing execution, more!

Join Fastlane Insiders.

Top Bottom