For Those Who Invest/Own in Rentals

[Barefootsies]

For those who invest in real estate, quick couple of questions.

1. Invest in single family homes or multi unit?
2. Advantages or Disadvantages to #1?
3. If Multi.... Duplex/Quad or a Bigger Complex?
4. Car Washes/Laundry Mats/Storage Facilities?

I am looking for those who either currently have, or have had, past experience. Thanks.

Fire away ladies.

[epitome]

The answer is whatever makes you the most money.

In all seriousness, since you're in Michigan, if I were you I'd be buying up shitty units for <$20k, putting $5-10k in them and turning them into Section 8 rentals.

Assembly line.

[fuzebox]

We looked at some fourplexes, but I just couldn't force myself to want to own a shitty building in a ghetto area... I really don't care if I could make a little bit more per month in rental income, the headache is not worth it to me.

My formula of single family home that rents at 1% of purchase price has worked well for me so far.

[JFK]

commercial is not very good at the moment, too many vacancies

[josephfgb]

One of my very good friends father owns a couple of storage unit complexes with uhaul rentals and he does very well for himself. i've worked there a couple of times and it seems to run pretty smoothly. dealing with uhaul is a joke, but the actual storage units are pretty solid. he has the complex paid off so he pockets quite a bit of it.

[marketsmart]

Originally Posted by Barefootsies

For those who invest in real estate, quick couple of questions.

1. Invest in single family homes or multi unit?
2. Advantages or Disadvantages to #1?
3. If Multi.... Duplex/Quad or a Bigger Complex?
4. Car Washes/Laundry Mats/Storage Facilities?

I am looking for those who either currently have, or have had, past experience. Thanks.

Fire away ladies.

single family, duplex, or quad, doesnt matter ... i only look at single units in multi unit buildings, but make sure associations are in order and dues are being paid..

i prefer single family, but downtown where the rental market is hot, there are not many single family home options..

whatever you buy, make sure you can recover your purchase price in 5 years of steady rents otherwise walk away.

for every deal i have found, i have put offers in on 20-30 and either been out bid or flat out rejected by the bank..

if you lose a deal, so be it... set a strategy and follow it..

there are so many deals out there right now if you are patient..

find a realtor that has been in your area for a very long time and knows people at banks..

that helps a ton....





.

[Barefootsies]

Originally Posted by epitome

The answer is whatever makes you the most money.

In all seriousness, since you're in Michigan, if I were you I'd be buying up shitty units for <$20k, putting $5-10k in them and turning them into Section 8 rentals.

Assembly line.

Good feedback.

[Barefootsies]

Originally Posted by fuzebox

We looked at some fourplexes, but I just couldn't force myself to want to own a shitty building in a ghetto area... I really don't care if I could make a little bit more per month in rental income, the headache is not worth it to me.

My formula of single family home that rents at 1% of purchase price has worked well for me so far.

You are not alone in that analogy. I know a couple of people around here personally who follow that same method. Especially preferring the single family home to the apartment building. Although one guy's reason was a bit different. It came down to phone calls.

He said apt buildings you get calls all the time for plumbing, noise, parking places, etc.. Where you do not get that so much with single family places.

[Barefootsies]

Originally Posted by marketsmart

single family, duplex, or quad, doesnt matter ... i only look at single units in multi unit buildings, but make sure associations are in order and dues are being paid..

i prefer single family, but downtown where the rental market is hot, there are not many single family home options..

whatever you buy, make sure you can recover your purchase price in 5 years of steady rents otherwise walk away.

for every deal i have found, i have put offers in on 20-30 and either been out bid or flat out rejected by the bank..

if you lose a deal, so be it... set a strategy and follow it..

there are so many deals out there right now if you are patient..

find a realtor that has been in your area for a very long time and knows people at banks..

that helps a ton.....

Great stuff.

[96ukssob]

depends on how much $$ you have and how involved you want to be.

if you have a pretty big bank roll (around $1mm) id buy a number of single family homes around $200k and rent them out to families. the mortgage would cost you about $1100/mo plus property taxes, etc, but you could probably rent it out for $1800/$2000/mo.

property tax and interest on the loan you can expense on your taxes. at the end you will probably make around $2k +/- per month depending on property taxes and dues.

likewise, you can buy a couple 4-plexes in the city, but most people who live there, treat like like shit. my friends mom owns one and people destroy the place regardless of deposit and their credit history. although, she does make more than if she bought a few single family houses.

plus, the more tenatns, the more you have to. 4 4-plexes vs 4 single family homes is 16 hot water heaters vs 4. likewise thats 32/16 sinks and toilets vs 8

IMO, i value my time and dont want to be spending it all fixing up some unit for the next tenant to fuck me. people who rent single family houses are more proud of where they live then complex renters... says my friend who owns a number of each

edit: btw, a little added rep for my awesome advice, ill be gladly to take lol

[Barefootsies]

Originally Posted by bossku69

if you have a pretty big bank roll (around $1mm) id buy a number of single family homes around $200k and rent them out to families. the mortgage would cost you about $1100/mo plus property taxes, etc, but you could probably rent it out for $1800/$2000/mo.

Interesting. Around here you can get those bread boxes for around $50-100,000.00 and they are like 900-1200 square feet with 2-3 bedrooms. My buddy rents them out for around $750-1000.00 a month. He said the 'key' is to get them under 100k.

Originally Posted by bossku69

IMO, i value my time and dont want to be spending it all fixing up some unit for the next tenant to fuck me. people who rent single family houses are more proud of where they live then complex renters... says my friend who owns a number of each

Good points.

[buyandsell]

Originally Posted by epitome

The answer is whatever makes you the most money.

In all seriousness, since you're in Michigan, if I were you I'd be buying up shitty units for <$20k, putting $5-10k in them and turning them into Section 8 rentals.

Assembly line.

I had a section 8 tenant check came each month like clockwork

[96ukssob]

Originally Posted by Barefootsies

Interesting. Around here you can get those bread boxes for around $50-100,000.00 and they are like 900-1200 square feet with 2-3 bedrooms. My buddy rents them out for around $750-1000.00 a month. He said the 'key' is to get them under 100k.

my friend lives in Michigan, your right the prices are a lot less than they are here in central PA. you can rent out larger homes tho for a lot of money. my ex's parents rented a huge house here in PA, some near 3k sqft house for $3k/mo.

i would personally stay away from businesses as they are a risk. people love to sue places. id only open a car wash if i lived in FL or the southwest of US

[Kenny B!]

The more doors you have the lower your vacancy rate and risk. If you own a house worth $400k you are relying on that one door to pay the mortgage, taxes and expenses, when it sits empty you are paying for it, with a 4-plex worth the same you have 4 doors paying the rent and if one sits empty you have 3 others bringing in income.

Leverage is your friend, as soon as your property increases in value and some principal is paid down time to refinance and use that equity to buy more properties.

There are exceptions to every rule, but in general you want as many doors as possible to limit risk. Also when you are buying multiple units the price per unit drops.

I know the housing market in the states has hit the shits, anything you buy should go up in value and all these people losing their homes have to rent. My example above is based on what's happening in Canada, I don't know the US market enough but those rules generally apply.

The real money up here is developing, build-it, sell it, rince and repeat.

[fuzebox]

Originally Posted by marketsmart

whatever you buy, make sure you can recover your purchase price in 5 years of steady rents otherwise walk away.

Damn, pretty aggressive. I haven't come across any places that fit that profile yet, at least in Vegas...

[targetpro]

I'm always partial to vacation rentals, cause you can use them and enjoy them while you make money.

[Elli]

We're looking into potentially the same kind of idea. Been watching the market in Maple Ridge and Chilliwack. You can get a nice little oldschool rancher for $180k, but they rent for about $1200. BUT you own dirt, which is in limited supply. So is there a math equation to weigh the benefit of owning land opposed to a unit in a strata?

[TidalWave]

Originally Posted by marketsmart

whatever you buy, make sure you can recover your purchase price in 5 years of steady rents otherwise walk away.
.

Originally Posted by fuzebox

Damn, pretty aggressive. I haven't come across any places that fit that profile yet, at least in Vegas...

That's because its bullshit. You will waste more time looking for the "one" and pass up on many good offers in the mean time.

I have five houses I bought for $80K in Florida, that you can't even BUILD for that. The build costs alone are $130K+, even my homeowners insurance will not insure for less than that as their appraisers say theres no way they can rebuild these for less. Before the crash these were selling at $220K!
I bought them for $80K and I'm making 10% yearly on them, and its still not within the 5 year amortization he stated above. How much better of a deal can you expect to find??

I'd rather have multiple good deals, then waste my time and energy looking for a maybe once in a blue moon deal.

Every month he wastes looking for this magical pony, I'm making money on my already purchased houses.

$0 vs profit, which one is better?

[Barefootsies]

Originally Posted by TidalWave

That's because its bullshit. You will waste more time looking for the "one" and pass up on many good offers in the mean time.

I have five houses I bought for $80K in Florida, that you can't even BUILD for that. The build costs alone are $130K+, even my homeowners insurance will not insure for less than that as their appraisers say theres no way they can rebuild these for less. Before the crash these were selling at $220K!
I bought them for $80K and I'm making 10% yearly on them, and its still not within the 5 year amortization he stated above. How much better of a deal can you expect to find??

I'd rather have multiple good deals, then waste my time and energy looking for a maybe once in a blue moon deal.

Every month he wastes looking for this magical pony, I'm making money on my already purchased houses.

$0 vs profit, which one is better?

Delicious dealios.

[GTS Mark]

stick to commercial, way easier and less bullshit.

[candyflip]

Originally Posted by epitome

The answer is whatever makes you the most money.

In all seriousness, since you're in Michigan, if I were you I'd be buying up shitty units for <$20k, putting $5-10k in them and turning them into Section 8 rentals.

Assembly line.

We're in a similar market and pretty much do the same thing, though haven't had to resort to Section 8. Students are actually working out much nicer. But that is just because we're taking places situated between 2 pretty decent (and expensive) private universities.

[Phoenix]

nice thread for sure...anyone ever buy land to put up a coin op car wash?

[Barefootsies]

Originally Posted by bossku69

edit: btw, a little added rep for my awesome advice, ill be gladly to take lol

Done fine sire.

[Barefootsies]

Originally Posted by Phoenix

nice thread for sure...anyone ever buy land to put up a coin op car wash?

My old business partner switched from single house rentals to car washed around 4-5 years ago. He said he would not invest in rentals again moving forward. He loves car washes for whatever reason.

He had started out buying 2 of them from some cop who had gotten in over his head. So he had gotten them for a song. Within 6 months he had bought 2-3 more. Within 2 years, a few more. He even bought a few that were not operational and completely rehabbed them, even adding in more bays.

I know for him, he was happy as a clam once he moved into that business. He has not purchased another rental, although he still retains the 30 or so he has right now.

[ShellyCrash]

Originally Posted by GTS Mark

stick to commercial, way easier and less bullshit.

Don't know how the market is right now in TO, but commercial real estate is in a bad place in most of the us. In Tampa Bay they practically can't give office space away, I'd imagine the same for Vegas. If you want to invest in commercial better be in a spot where you can sit on it for a while.

[McSpike]

Originally Posted by fuzebox

We looked at some fourplexes, but I just couldn't force myself to want to own a shitty building in a ghetto area... I really don't care if I could make a little bit more per month in rental income, the headache is not worth it to me.

My formula of single family home that rents at 1% of purchase price has worked well for me so far.

you mean your PRICE to RENT ratio is 12 fucking percent??!

[fuzebox]

Originally Posted by McSpike

you mean your PRICE to RENT ratio is 12 fucking percent??!

Correct, $85k condo renting at $850/mo, $130k houses renting at $1300/mo. The return isn't 12% after management fees and property taxes, closer to 8%.

[fatfoo]

Invest in a property that will make you more profit. After you buy a property, you could rent it out to other people to receive revenue.