Real Estate
 

Just blowing my own horn here. Everything I bought in the down turn has doubled in price. I should have bought more!

The big question is do we go to new heights or has it topped out with all the QE stuff. This has been a huge recovery. Very long if not super strong by most standards.

Sell sell sell!

You could always hedge - sell some, keep others.

The best money making tip is real estate here in Europe.

I was planning to buy a few years ago but I was lazy to do so, now the prices went up and I easily could make a nice 30% profit on it :(

congrats :thumbsup:thumbsup:thumbsup

What area of the country did you buy in?

There is no such thing as a bad profit :2 cents:

Bears win ... Bulls win ... Pigs always lose :2 cents:

:thumbsup:thumbsup

Who says there is such a thing as bad profit?
Of course, on the other hand, there is such a thing, lets say 0.1%/year would be a bad profit :)

I'm with you. Purchased our primary home 3 years back. Sold for almost double.

We downgraded on the next home sq footage wise, put more $ down and are on a 7 year plan. We took the other half of the profit and have invested in a new primary residence being built. The current home has gained about 20% in 6 months and will become a rental.

Once we get the rental property paid off and we have that passive income coming in, we will aim to purchase another...Rinse/Repeat.

Our main goal is to not increase our monthly spending on real estate, while acquiring more properties and equity. We haven't seen any spikes out here that would indicate a bubble, but still hesitant after what just happened a few years back.

Hope all is well, my friend!

...maybe in your world but in the real world
Bulls make money, bears make money, pigs get slaughtered

Doubled value in Pompano Beach .... plus a bonus 35% exchange rate .... Not bad ...

Paid during the crash : 170K
Same unit sold a month ago : 348500.00

Local real estate in Montreal is not the same as we did not have a crash ... My rental properties here increase of about 4% a year, stll giving me 45K$Cdn a year, aside from the cash flow and profit .

Can`t say the same of my mutual funds ... :(

We need to meet up and shoot the shit.

I've avoided buying locally because tenants have way too many rights in Quebec. All of my real estate holdings are in Phoenix, I bought during the crash. If a tenant is 5 days late I can have the sheriff remove them in under 30 days.

For me real estate is a long term play, buy and hold. If I sell it's to upgrade to a different property. Time will tell if that's the right move but anyone who bought real estate 30 years ago and held it has done quite well.... except those who bought in Detroit :Oh crap

Pay attention to your ROIs... Appreciation is always risky to rely on, pay more attention to cash flow. Dead equity dragging down returns is not something you want...

Initially we hadn't planned on getting in on Real Estate as an investment. The home going up for rent was supposed to be our primary home...until we found one more suited to our tastes that was a VERY limited opportunity.

This rental will be a break even, as it was financed more as a primary home with a 10 year mortgage. I'm not too worried about the equity on it in the near future. We owe pretty little and we're not borrowing on it's equity to fund the new primary residence. In 7 years, the passive income will be near $2k a month after property management fees. It'll be nice to have that full loaf for sure.

Down the road, 100% of the decisions (of rental properties) will be based on ROI. With our primary residence, us liking it regardless of the market value is the key. We can hope the value goes up on that, but I personally don't see much upward trend over the next 5 years that is above inflation. :thumbsup

For those who invest in residential/vacation properties do rents cover your mortgage payments and maintenance costs?

Well yea. Should always build in mortgage payments, maintenance, vacancy, expenses (like utilities, administration etc), taxes, etc and still cash flow. And have it leveraged up enough to cash flow with an estimated ROI that'll beat safer easier investments

Appreciation is a bonus

If it's break even due to the loan that's some forced savings which I guess is a thing, but why not sell and buy a few leveraged properties with better numbers? Maybe not immediately but as you get more comfortable doing it and need more for down payments. Another option is cash out refi, pull extra equity out (tax free), change term to longer for cash flow so you can reinvest quicker

It sounds impressive, but really it's not... you could have bought sp500 index fund and doubled your money too, with zero work or worry... with some leverage and/or buying some slightly riskier assets could have very easily tripled your investment... :2 cents:

Genius, touting profitable funds after the fact.
Could have became a billionaire if you knew that before hand.

I'm not touting anything, just pointing out that investing in the "stock market" (which sp500 fund tracks) in the same time frame, would have resulted in the same (or greater) profit with far less work/worry...

And what is your point? After the fact there will ALWAYS be something else that would have netted you more.

The majority of what I do now is cater to the vacation cabin rental market and I cater to 2 hot zones.

In both, the majority of home owners do not make real money. In both the majority do not even cover all their expenses - UNLESS THEY DO ADDITIONAL MARKETING ON THEIR OWN.

I have also found the sweet spots are 1 and 2 bedroom units, and then 6 bedrooms and above. I had a 1 bedroom bring on almost 60K in one year (unit cost $115 to build). I had 4 bedroom units on the same street in better condition that brought in about 1/3rd that for the owner.

If you have a heavily used rental you will not get 10 years out of a sofa, dishwasher, carpeting, hot tub etc. Once you are not "fresh" the ratings go down along with the rentals so you need to really keep up.

Is that a separate house/cabin? 115K including the land?

Most years yes and then some. A few unexpected repairs and vacancies and it's easy to be upside down, but if you put away in the good years you'll be just fine during the not so good ones.

The difference is with a property it's the tenant is paying off the asset for you. Plus if or I should say when the market tanks like it does every 8 to 10 years at least you have a house you can live in;-)

This was the point I was trying to make. That's why you need to pay attention to ROI cause stock market is light years easier then dealing with tenants. Real estate isn't nearly as passive

yeah i heard 400 million more rapefugees are coming over next year

:1orglaugh

You are ignoring positive cash flow which was quite high as the properties were free and clear.

Wow good for you. If you ever want advice, just hit me up. I come out there about once a year. And maybe I should hit you up for advice hahahah

well it took 8 years. its great for real estate but i am too impatient to wait that long to make a good return.

wot?

.

maybe when you get to finance 201 you'll learn about the tax advantages of his investments.

I purchased after the market hit rock bottom in 2012. We purchased in an area with 5* schools (elementary, middle school and HS). We purchased a 4,000 sq. ft McMansion and at the time the production costs were even with the sale cost, more or less. The zip we are in has not doubled in price, but the community we purchased in has since 2012 due to the area growth. It's one of the top 10 growing communities in the nation. Homes bought in 2012 have that inflated equity, whereas a home purchased in 2014-2016 doesn't.

The reason that house in particular increased at that rate, was because of the size. Most homes in the area are 1800-2500 sq feet. That particular home was semi-unique, hence the accelerated increase. The typical growth rate in this zip since 2014-2016 is 14%. It's a great growth rate, but not an abnormal spike. I don't forsee the doubling of this market anytime soon, and it's currently just growing at a pretty normal rate.

Slapass: Sounds good! Looking to make another move on the market in a different area in the next 6 months. :thumbsup

ARock: That's the plan. After this tenant is out, we'll likely put the unit up for sale, collect the equity and reinvest to another property or 2, while also refinancing our primary to a 15 with bi-weekly payments.

Woj and ARock: Not diversifying and investing in the S&P as well as other investments would be a poor play. I take advantage as many tax deferment investments as possible. To take it a step further, I've invested in the art market as well, which has returned about 500% over the last 5 years. There's some work in that, but it has a level of enjoyment as well.

All bickering aside from everyone, it's great to see so many in this industry investing in the future. Back in the early 2000s, the large population of this industry believed that the money machine was everlasting and we all spent like crazy. :1orglaugh

:love-boob

:yinyang

Research, research then research again. We're selling a property we bought 10 years ago. For 4 times the price we paid because we researched how Brno is expanding. The old cottage is being demolished and the builder will construct 4 properties where there was 1 and a lot of garden/orchard/vegetable plot.

My brother in law did the same.