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    Monday, May 18, 2020

    Real Estate Investing: Rents are lower than mortgage payments in my area. Is it a bad time to buy?

    Real Estate Investing: Rents are lower than mortgage payments in my area. Is it a bad time to buy?


    Rents are lower than mortgage payments in my area. Is it a bad time to buy?

    Posted: 17 May 2020 02:54 PM PDT

    I'm deciding whether to rent or buy a condo for my own personal use and rents are 5% lower than mortgage payments. It seems like rents will need to stay flat/decrease for awhile because incomes are dropping for everyone who doesn't work at Amazon/Netflix. Despite the shaky economy, sellers still aren't accepting lowball offers -- I'm guessing because the RE market takes longer to react to events. One of my friends who has a real estate business sold his personal house and started renting. Is there any reason to consider buying now? Low interest rates are nice, but I could also save cash and buy a place for a lower price in the future.

    submitted by /u/Random_Cat_On_Bench
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    Forecast for Chicago’s residential & commercial real estate market in the next few years?

    Posted: 17 May 2020 06:49 PM PDT

    I currently live here in Chicago, but I want to know if this is a good market to invest in during the next few years while considering the effects of the pandemic. I'm pretty young, so I can always consider other markets.

    submitted by /u/joshua_2401
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    What do you do with the money you set aside for capex every month? High-yield savings acct? Invest in bonds? Broad market index fund?

    Posted: 17 May 2020 08:07 AM PDT

    I start house hacking this month in a home I plan to turn into a rental so I'm trying to get my systems in place now.

    Say you set aside $200 per property each month to save for capital expenditures or even basic maintenance. What would you do with this money so that you beat inflation, have access to it when you need it and have relatively good risk/return profile considering it's purpose?

    It seems like most people use a high-yield savings account, but I feel like this leaves too much money on the table. I had the thought of investing this money into stocks, with a cash buffer for the first few years until the stock portfolio could pay for most capex costs even after a downturn, leaving the cash in the bank but no longer contributing more to the pile of cash. Obviously there's more risk here, but it sort of mimics an HSA account, though the withdrawals would be taxed.

    I wanted to know what people thought of this idea, and what you do yourselves

    submitted by /u/Jtmyer
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    What’s is your experience with dealing with mice in a property?

    Posted: 17 May 2020 06:29 PM PDT

    I have a property with a tenant reporting mice. I am not comfortable with setting live snap traps, poison traps, etc in a house I can't control to be in.

    The tenant has a pet and if they were to get into the traps I feel as though I would be responsible for vet bills.

    Any recommendations?

    submitted by /u/thatoneguysbro
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    Buying shared flat, live in one room, rent out others as a university student

    Posted: 18 May 2020 04:11 AM PDT

    I am 19 years old and live currently in Austria with my parents. In October I will change university, start to study business and economics and move to the capital. I have always been interested in real estate. My dream is to buy a flat close to university, live in one of the rooms and rent out the others to cover a big part of the loan. Its been on my mind since middle school and i have read countless books about money, investing, real estate,... I just dont know how to make the numbers work/ what numbers I need to make it work and if it is even possible at my age/with no 40h job that pays for the loan.

    I have more than 4k on my bank account (I know its not much for what I have in mind) and very supportive parents. They want to support me in this since their parents never did and they ended up taking a loan in foreign currency (swiss franc) because they didnt know any better by that time and you all know how that turned out. Loan is payed off due to my dads good salary but it cost us 300k more than it should have.

    My biggest problem is getting a loan without a regular income that can pay it 100% back in time - I would depend on the tenants. I have no tution costs, my parents pay for groceries and other essentials and I spend basically nothing besides that.

    I just wish to know if it is even possible. Because if I start now, I wouldn't have to even start on the downwardsspiral paying rent until I take out a loan and build a house by the time I am 30+.

    Also, Corona has stirred up the market and university students always have to live somewhere. I dont want to look back at this moment in my life and think I have wasted a huge chance even if really risky. I am down to get dirty!

    What is your oppinion on my story/dream? How did you start out? I would be so grateful for your stories and experiences or tips!

    submitted by /u/xSaphira
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    How do investors make the numbers work?

    Posted: 17 May 2020 09:40 AM PDT

    Hello,

    I've been looking at single family houses to buy for a long term rental. I've put in a few offers on houses that need a fair rehab. (20k-40k).

    I've been outbid by others consistently.

    Anything offer that I am comfortable with ends up being way too low.

    I have low cost contractors. I could pay cash but prefer not to. Though I am not working as my own realtor though.

    I saw a house listed at 180k at 100/sqft with a good 40k rehab needed to take it to top dollar. Comps after remodel are 150/sqft. Which would put this house at 265k.

    So I offer $190k and am told they already have offers at $215 to 220k.

    How do investors make this work? How do they buy at $220k with closing costs and put $30-40k in to flip at 265k? Who puts all of that work in just to bring their final cost to market value?

    The ROI on a flip seems very poor, and the cash on cash return as a rental is also very poor.

    How are people making these work as an ongoing business?

    Is it safe to assume there is no good investment to be found on mls? Where do you find them otherwise?

    Thanks for any input.

    submitted by /u/Chabubu
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    What amount of rent can I expect to charge per $100,000 put into a property?

    Posted: 18 May 2020 01:48 AM PDT

    I am considering some scenarios before jumping in to real estate. And was unable to find any estimates on exact earnings. Or at least on how to think about earnings when considering what type of properties to keep on my plate.

    I have seen a reverse set of estimates on articles and videos discussing from a renter's point of view what "fair" rent should be charged when looking at options. And it seems that monthly rent should be 1% of the property's value.

    With this in mind, is my assumption correct that for $100,000 invested in a property, I should expect to receive $1000 gross profit before fees and taxes on it? As an additional, straightforward and simple example, should five properties worth $100,000 each gross me $5000 a month?

    Thank you for your time. I'm trying to figure out what X amount I should put into real estate to achieve a livable income. My monthly spend is around $4000 for my wife and I. If I can supplement all of that through managed properties anywhere in the world, I am open to having one apartment in LA, one in NY, and two to three elsewhere in the world to diversify my holdings in different real estate markets. I assume having them furnished and managed by agents in each of their cities is no different than trying to consolidate 4-5 properties in a single city.

    submitted by /u/veotrade
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    International Markets - what are your thoughts?

    Posted: 17 May 2020 07:21 AM PDT

    Hello everyone!

    🏡

    I am interested to know what your thoughts are on cross-border investing with real estate?

    Are there any key markets you are currently investing in, or, have your eyes on?

    What are the key signals for a yes - or a no - when looking at an overseas market?

    submitted by /u/NEBSLY
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    Inheriting a duplex and weighing my options

    Posted: 17 May 2020 04:32 PM PDT

    Hey everyone, Looking for some advice here. My mother passed away and I am inheriting a third of her estate. One of her assets was a duplex that I'm currently living in. I'm planning on purchasing the duplex from my two siblings and likely buying another property. So, my question is should I take out a loan for the amount I would need to pay them off or should I use the inherited cash to pay them off and own the duplex free and clear and then pull money out of it to buy the next property? Thanks for your advice!

    submitted by /u/turtleboy523
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    What would you do?

    Posted: 17 May 2020 10:31 PM PDT

    I'm looking to buy or a rent a place with my SO that's around 1000 sqft 2b/1.5b but any decent ones go for 300k-ish with some dumpy looking ones for 250k-ish. Most of them are condos or townhomes. Rent for a similar place would be 1600-2200

    Alternatively there is a few newly built 2017+ houses with 4b/3-3.5b 2200-3300sqft going for around 450k-500k and older ones that could use a facelift for 250k. The extra space/larger rooms and extra rooms would reduce our initial need to only use 1bedroom and 1bath (massive dual vanity with separate shower and tub, extra dens). We would both have room for office space without occupying additional bedrooms.

    I could get the house and rent out the 3 additional rooms at 1k each on the rock bottom end and up to 1250-1500 (considering all shared living space furniture/equipment except room is included — could maybe include some cheap ikea furniture in their rooms. And also including consumables since I buy things in bulk from Costco) on the upper end.

    I can easily afford the mortgage/tax/insurance payment myself so not having renters wouldn't be a big deal. It would just be a lot of space we wouldn't use. having only 2 renters would cover most of it maybe even including utilities. A third renter would most likely be pure profit if things go well and the home doesn't need any repairs (since it's new).

    The thing is I'm not sure if I plan to live in this city for 4-5 years, but if things end up going great this house would be the almost a perfect "settle down" home. Pulling 100k out of investments for a down payment during a downturn is also a hard pill to swallow.

    All in all financially I think buying the new one to live in makes the most financial/self satisfaction sense while the 250k facelift one makes pure financial sense to buy. Maybe could buy ones that need a facelift as investments down the road if I can get room by room to work?

    Sounds good on paper, but seems too good to be true.

    submitted by /u/TurboBerries
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    Where to find rental comps

    Posted: 17 May 2020 09:49 AM PDT

    I am looking to purchase a rental property. I am having trouble finding a website that I can browse through rental comps, as in properties that have been listed for rent and then were subsequently rented. I have a limited MLS access portal through my realtor, but it does not have that feature. My realtor can look them up for me, but I would really like the ability to do it myself. Any advice?

    submitted by /u/Nico_Briggs
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    How does square footage get recorded for new development

    Posted: 17 May 2020 05:13 PM PDT

    I know so many cities have terrible record keeping and square footage at the assessor's should not be trusted...

    How does the original figure for square footage get determined at the city level? Most new development in my market (Bay Area) includes a visual floor plan in the disclosures. Is that the number that will get sent to the city? I'm assuming the city doesn't send anyone out to actually measure each unit in a new development, but could be wrong.

    submitted by /u/ospreyintokyo
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    Ideas for finding properties?

    Posted: 17 May 2020 08:24 PM PDT

    So I'm ready to get started, I have enough for a down payment. My issue is that I cant seem to find duplexes/triplexes etc for sale. It might be a factor of where I live, Oahu. But there is so little out there in can find. I even looked at some properties in areas I might be transferred to in 2 years, Annapolis and Groton CT.

    I looked on Zillow, Realtor.com, redfin etc. No real multifamily properties are coming up. Am I missing something? Any suggestions on where to look?

    submitted by /u/raiyos
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    Is this stupid

    Posted: 17 May 2020 11:11 AM PDT

    Hi guys so I was recently told that I could use life insurance as collateral on a loan so as a 20 year old I got life insurance that would allow me to do that. After talking on the phone with my bank they said that I could do that so I tell my friends and they said that using it as collateral is stupid I just want to hear your thoughts.

    submitted by /u/BrandonAlanFrazier
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    Renew lease for good tenant but super under market?

    Posted: 17 May 2020 03:53 PM PDT

    Curious of your thoughts on this...One of our tenants in our recently acquired quadplex has been living there for 6 years and has not missed a rent payment. They even pay rent early in a time like this. They keep their unit super clean and in good shape, they don't make any noise, and we hardly ever see them. However, they are paying ~$200 under-market rent.

    Our options include raising rent to market rent and 100% losing them or raising rent slightly and most likely not lose them. Keeping a good tenant is worth the slightly smaller cashflow right?

    The other factor here is that we were intending on moving into this unit, since it is slightly better for the owner-occupancy, and we are renovating a different unit that we were planning on renting at market rent. Thoughts?

    submitted by /u/vTheCurrentEvent
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    Does the property need to be owned by LLC?

    Posted: 17 May 2020 06:29 AM PDT

    I have read about all the pros of having an LLC for your rental property. My question is, could the LLC just manage the rental and not own the building? This seems like the best way to protect the building as an asset if there were a lawsuit against the LLC. I don't find any information on this, what am I missing here?

    submitted by /u/Squashpi
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    Has anyone had Condo fee/HOA increased because of being an investor ?

    Posted: 17 May 2020 08:16 AM PDT

    I had an amazing 1500sf 2BR/2FB condo 3 blocks from the US Capitol in Washington DC. It was a small building with maybe 10 units . They managed to change the bylaws and put an extra 10% surcharge.

    submitted by /u/NPRjunkieDC
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    Thoughts/questions about energy efficiency, ROI, and rents

    Posted: 17 May 2020 11:43 AM PDT

    Would making one's rental (specifically 5+ units) more energy efficient provide a meaningful ROI? I understand most landlords bill the utilities back to their tenants, but what if one could reduce the utilities that their tenant is paying while billing maybe 20%-50% of the saved money back to the tenant in the form of increased rent? In the end, the tenant will still be saving money and one has successfully increased rent while providing something tangible to the occupier.

    Is this a viable strategy?

    submitted by /u/Blackesst
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    Best Way To Learn Real Estate Investing

    Posted: 17 May 2020 04:27 AM PDT

    I have been mainly investing in stocks and I would like to learn more about real estate and perhaps start investing as well.

    My problem is that I'm a complete beginner. I don't know how it all works, how to protect my assets, how to get a loan, traps, what to look for, what not to buy...

    Heck, I don't even know all the terminology...

    What is the best way for me to learn about real estate investing. Are there any courses, books YouTube channels, any other resources...

    Thanks!

    submitted by /u/jamesbutchermess
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    Online rental application Rentscreener?

    Posted: 17 May 2020 11:00 AM PDT

    Hello,

    I really want to have my rental application to be online and customizable to my own liking with the ability to choose the agency I get my credit checks from. Rentscreener seemed to be the only website that allows you to really customize an online application and select your own agency. Does anyone have experience with this company?

    submitted by /u/turbowd
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