So I want to get into real estate investing

Detroitgator · Apr 4, 2019

78 said:
I'm not going to attempt a backdoor way to guess your 2014 AGI but I may be hitting you up for a loan at some point.

There was a four year stretch there that made me vomit writing checks while spending time reading people in the PF here... would've loved to have the current tax laws during that period, have ramped up working again to take advantage this time. It was just rape (still is though) at the lowish end of the high tax bracket... plus PPACA added wealth tax.

NVGator · Apr 4, 2019

Alligatoridae said:
I bought my house 3 years ago with a VA loan (0 down) that is the only actual experience I have. I have read a few books (I'll list them if yall want to know), and I have watched 100's of YouTube videos. I only have about 5k cash and am not trying to get rich quick. My wife is going back to work after 8 years, she is getting her real estate license and working with another agent that sold us our home.

My tentative plan is to save as much of her commissions as possible to get enough money to fix&flip houses for a while and keep a rental property when the income for the year is high (for taxes). I am seeking advice from people who are experienced and successful in the real estate market, not merely ambitious and well read people such as myself. If anyone is interested in having their brain picked I'm your guy..

Investment property financing requires 20% down, keep that in mind. You might fair better using your VA again to upgrade your primary residence and rent out your current house. I don't know all your details on your current financial situation.

As for the wife, good luck. Everyone's becoming a Realtor now. They think all they have to do is sell a home a month. Easy peasy.

Detroitgator · Apr 4, 2019

NVGator said:
Investment property financing requires 20% down, keep that in mind. You might fair better using your VA again to upgrade your primary residence and rent out your current house. I don't know all your details on your current financial situation.

As for the wife, good luck. Everyone's becoming a Realtor now. They think all they have to do is sell a home a month. Easy peasy.

You need a good team, and the right mortgage broker/lender is a key part of that team... you can get quite creative.

Bushmaster · Apr 4, 2019

Detroitgator said:
Just to bring you up to speed, "Politi" (actually "L-Boy") considers you "lucky" and refers to what you are doing in real estate as a "scheme", not an investment opportunity/business.... just so you know what you are dealing with. Also, on your tax discussion, also to bring you up to speed, he's failed at this before by trying to reverse engineer what I stated I paid in Federal Income Tax in 2014 (7 figure number) into what I earned that year. He is well educated (I'd say overly so) and somewhat intelligent, but has zero risk tolerance in life and bristles at those who have taken risk and succeeded. I've often suspected that he actually tried something once, but it didn't work out, he never tried again (for whatever reason), and now poo poos anyone who had the balls to try one or more times and succeeded.

7 figures!!! Damn, did you hit the lottery?? That is some serious change to write to Uncle Sam.

I have a couple football player clients and one hit close to 1.5 in tax the year he got his second contract with bonus. Good thing for him he still has most of what he earned playing.

Bushmaster · Apr 4, 2019

NVGator said:
Investment property financing requires 20% down, keep that in mind. You might fair better using your VA again to upgrade your primary residence and rent out your current house. I don't know all your details on your current financial situation.

As for the wife, good luck. Everyone's becoming a Realtor now. They think all they have to do is sell a home a month. Easy peasy.

This is where it gets creative. We get our bank to finance estimated fix up costs (we are always under) as long as the appraisal come in right. We bought several houses last year and didn't have to come out of pocket. I am sorta scared to ask my banker what he does to work this.

Detroitgator · Apr 4, 2019

Bushmaster said:
7 figures!!! Damn, did you hit the lottery?? That is some serious change to write to Uncle Sam.

I have a couple football player clients and one hit close to 1.5 in tax the year he got his second contract with bonus. Good thing for him he still has most of what he earned playing.

I got a "life changing" contract the year before that ran for 5 years.... all Obama/PPACA tax years with minimal (practically zero) eligible deductions off that contract other than travel. :(

Detroitgator · Apr 4, 2019

Bushmaster said:
This is where it gets creative. We get our bank to finance estimated fix up costs (we are always under) as long as the appraisal come in right. We bought several houses last year and didn't have to come out of pocket. I am sorta scared to ask my banker what he does to work this.

This is what I was talking about in regard to having the good team, which includes mortgage broker/lender. All about the relationships and delivering on what you say you will do... like everything in life.

williston_gator · Apr 23, 2019

You could try something like fundrise but it may not be what you are looking for.

Gatormac2112 · Apr 23, 2019

I’m just getting started in this as well, the pickings are slim around here as everyone thinks their 10 year old trailer on an acre is worth $90k. I did find and purchase a VA foreclosure on an 1100 sqft 3/1 brick home with basement on 5+ acres of useable land for $45k. Needed work, but will only have about $60-65k total in it, the land in this area goes about $5k/acre so I could either sell off $25k or develop it. It’s a safety net the way I look at it.

I have no idea what I’m doing though, but eventually you have to do something other than read blogs and books or you’ll never learn, so when I saw what I thought was a good deal I jumped.

Detroitgator · Apr 23, 2019

Gatormac2112 said:
I’m just getting started in this as well, the pickings are slim around here as everyone thinks their 10 year old trailer on an acre is worth $90k. I did find and purchase a VA foreclosure on an 1100 sqft 3/1 brick home with basement on 5+ acres of useable land for $45k. Needed work, but will only have about $60-65k total in it, the land in this area goes about $5k/acre so I could either sell off $25k or develop it. It’s a safety net the way I look at it.

I have no idea what I’m doing though, but eventually you have to do something other than read blogs and books or you’ll never learn, so when I saw what I thought was a good deal I jumped.

If you break even on your first one and learned a lot, that’s a big win.

BMF · Apr 24, 2019

NVGator said:
Investment property financing requires 20% down, keep that in mind. You might fair better using your VA again to upgrade your primary residence and rent out your current house. I don't know all your details on your current financial situation.

As for the wife, good luck. Everyone's becoming a Realtor now. They think all they have to do is sell a home a month. Easy peasy.

This is great advice for the OP.

Bush is an excellent source for advice on rental property.

We've discussed this before in previous threads, but the market is WAY, WAY over valued right now and I'm staying out until I see some price drops. I'm not sure when that will be, but there's no way home values can continue to rise the way they are.

One of my favorite books is Rich Dad, Poor Dad - he talks about the 1% rule. For Bush to get 1.2% is VERY impressive.

I've been looking for properties that can get the 1% rule and I'm zeroing in on Englewood, Port Charlotte, Punta Gorda areas - lots of properties under $175K that rent for well over $1,000...so it's just finding one that brings you close to the 1% rule. (but I'm still holding off right now - I sold one of my two rentals last year and I banked the money in a brokerage account).

For the OP, I think NV's advice is solid. Rent out your current home and find somewhere else to live. That's how I got my first "rental property".

Concrete Helmet · Apr 24, 2019

BMF said:
Rent out your current home and find somewhere else to live. That's how I got my first "rental property".

I mentioned this in an earlier post and it is how I got started. I had saved enough to put a large,30%, down on my 2nd house and the first house was on a 15 year with only about 30K remaining, it was worth 160K at the time. The cool thing about renting a home you'll already lived in is that you know what to expect most of the time when something goes wrong be it an AC, roof, plumbing or whatever. When you purchase investment property that you don't have a history with it usually has more than a few suprises particularly if you purchase from an "investor or flipper"... We've got one that we acquired that way and it has been a real motherf......well it is a nice write off every year lets put it that way...We're in the process of evicting the tenant and when their gone it's going to be sold back to another investor. Thank God property values are up right now...

Bushmaster · Apr 25, 2019

Gatormac2112 said:
I’m just getting started in this as well, the pickings are slim around here as everyone thinks their 10 year old trailer on an acre is worth $90k. I did find and purchase a VA foreclosure on an 1100 sqft 3/1 brick home with basement on 5+ acres of useable land for $45k. Needed work, but will only have about $60-65k total in it, the land in this area goes about $5k/acre so I could either sell off $25k or develop it. It’s a safety net the way I look at it.

I have no idea what I’m doing though, but eventually you have to do something other than read blogs and books or you’ll never learn, so when I saw what I thought was a good deal I jumped.

That is solid. Put mobile homes on the other property if zoning allows it.

Bushmaster · Apr 25, 2019

Detroitgator said:
If you break even on your first one and learned a lot, that’s a big win.

Yep!! Did our first flip this year. The house was amazing and we had over 10,000 engagements on our Facebook page the week we put it on the market. We did a week by week update and kept in front of our followers so there was always some excitement.

We broke even. :(

We over improved the property but did learn a lot. We now have a slew of contractors who we know do good work, which ones are crap, how to build a property for the neighborhood you are in, how not to improve a property as if you were going to live in it (it costs a lot!!). My partner was bummed we didn't make a bunch of money, but education isn't cheap. Luckily, all we lost was profit and some sweat.

Detroitgator · Apr 25, 2019

Bushmaster said:
Yep!! Did our first flip this year. The house was amazing and we had over 10,000 engagements on our Facebook page the week we put it on the market. We did a week by week update and kept in front of our followers so there was always some excitement.

We broke even. :(

We over improved the property but did learn a lot. We now have a slew of contractors who we know do good work, which ones are crap, how to build a property for the neighborhood you are in, how not to improve a property as if you were going to live in it (it costs a lot!!). My partner was bummed we didn't make a bunch of money, but education isn't cheap. Luckily, all we lost was profit and some sweat.

Yup... it's all about having the right TEAM. Ya recruit, develop, trade, and.sometimes... cut! ;)

Gatormac2112 · Apr 26, 2019

Bushmaster said:
That is solid. Put mobile homes on the other property if zoning allows it.

That actually was our plan, but I’m not sure where to find mobile homes for a decent price anymore. And one of the neighbors came by and basically begged me not to put mobile homes on it :tongue:

gatormandan · May 3, 2019

I started in the house flipping business back in 04 I think. I was grasping at straws for a long time trying to get financing and having enough money for repairs, remodels and insurance etc. I managed somehow but lost big on one dumb purchase (50k) and thought it would ruin me but I pulled thru and went on to making some decent money.

The whole time I was in the business I sought out millionaires that would be my go to bank while I made them money as well. It was difficult finding them and then convincing them to trust me in such a short time. I finally found my guy and life got so much easier. No more bank loans for me.

I advertised everywhere that I bought distressed properties and got pretty well known in my area as the "house guy". Everything was buzzing along and I had several houses bought and in the process of remodeling when my investor died in his sleep and his sons came into the picture. There was a long drawn out court battle mainly because my investor never wanted any payments until the properties sold and the sons wanted immediate payments which was not our agreement. It was a mess but I won. I sold the properties and started slowly getting out of the business.

Today I manage 23 rentals for my investors nephew. I have been doing this for years. I have 2 guys that work for me full time that do everything that needs done. If I were to give advice to a new investor I would say make sure you have cash in the bank or another source of cash available. I took many courses from the guys who preach that you don't need any money to invest in real estate and I beg to differ. Start slow and don't overload yourself. There is always money to made in real estate. Good luck.

So I want to get into real estate investing

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