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Going for broke

  • #21
  • Jun 22, 2008 5:28pm Jun 22, 2008 5:28pm
the good thing about real estate is that its a tangible asset that does not waste and historically increases in value. As long as the world/local population continues to grow so will the value of your home. In miami alone there are 100k ppl +/- that immigrate EVERY month (this was a stat from NAR this time last year). As well, regardless of anyone's personal financial situation they still need a home, therefore a tenant or homebuyer is ALWAYS around the corner. Usually rents are fixed based upon market rents and a escalation in rents is usually contigent with commercial property with long term tenants. To me commercial is great!!! you find a long term tenant (usually a large commercial company ie mcdonalds) lock them in on a 10 year lease with 4-5% annual increases. By the time the lease is up they cant just pack up their bags and leave and lose their client base so they tend to stay. And oh yea with commercial foreclosures you could evict the tenant and take over the biz!!! It has happened
  • #22
  • Jun 22, 2008 5:32pm Jun 22, 2008 5:32pm
Quoting tdion
you make sense.... though it seems it comes down to being a cut-throat business man with no regard for the tenants.... many folks just can't afford a rent increase

it's neither here nor there.... i understand your point of view.... it is the capitalist way of doing things.... i guess i just wouldn't have it in me to raise rent on people barely making their ends meet.
I moved them in dirt cheap- usually just enough to cover my note. Maybe a little more if I had bought the property at a very low price. In several cases the guy agreed to do a lot of the work in return for x number of months rent.

I told them exactly what I was doing. I said I was going to repair the property- new paint, inside and out, landscaping. If the floors were torn up, I fixed them..etc.

Then I told them I was going to raise the rent at the end of six months and told them exactly how much I was going to raise it. I told them this before they signed the lease.
  • #23
  • Jun 22, 2008 5:37pm Jun 22, 2008 5:37pm
Quoting renegade7
Interesting.
Did you find you were limited by neighboring properties and their rent pricing, or was your property "well worth it" on the interior, etc.
How exactly did it "raise the value" with comparitive housing in the area for possibly much less?
I looked for property that was in disrepair. I didn't want anything that required a renovation. Cosmetics makes a lot of difference in property values.
Paint, a crappy yard, a fence that had fallen over etc.
I wanted a place that looked like hell, that would not take a lot of money to fix.

I would initially rent it out at below market. Repair it and rent it at market or above.
  • #24
  • Jun 22, 2008 5:40pm Jun 22, 2008 5:40pm
Quoting billbss
I looked for property that was in disrepair. I didn't want anything that required a renovation. Cosmetics makes a lot of difference in property values.
Paint, a crappy yard, a fence that had fallen over etc.
I wanted a place that looked like hell, that would not take a lot of money to fix.

I would initially rent it out at below market. Repair it and rent it at market or above.
Gotcha.
So that would make sense for why the clients stayed after 6months if they were paying less than market value to begin with. Is that correct to assume?
  • #25
  • Jun 22, 2008 5:43pm Jun 22, 2008 5:43pm
Quoting renegade7
Gotcha.
So that would make sense for why the clients stayed after 6months if they were paying less than market value to begin with. Is that correct to assume?
They knew they were getting a deal to begin with.
I also offered to apply part of the rent they had paid to the house if they wanted to buy it, when I was ready to sell it. I gave them first shot at it.
  • #26
  • Jun 22, 2008 5:47pm Jun 22, 2008 5:47pm
Quoting billbss
They knew they were getting a deal to begin with.
I also offered to apply part of the rent they had paid to the house if they wanted to buy it, when I was ready to sell it. I gave them first shot at it.
Cool. Thanks for responding
  • #27
  • Jun 22, 2008 5:56pm Jun 22, 2008 5:56pm
I've had rentals and I've also had maintenance contracts with apartment complexes while also running a handyman and remodeling business, and it's a line of work that I thoroughly enjoyed, and made pretty good money at it as well, but there is a lot of work involved with doing this, along with time driving, time running the business, time hiring and firing employees, making sure the customer is satisfied and making sure the renters pay and don't move out overnight or tear up your place while you have to pay to get them evicted when things go bad as they will do in a slow economy. Where I live they penalize homeowners on taxes, make the landlord pay the water bills, imagine driving by your rental and seeing a pool in the back yard 8) lots of headaches and now that I'm pushing 40 and I have a son that I want to spend time with, forex is the perfect job for me, I've spent the last year and a half studying and learning what makes this thing tick and reading everything I can, especially here at forex factory (thanks to everyone that posts here, you all have been a great help) and I've made money, lost money, made it back, you know how it goes, but I get better as time goes on and I'll continue to get better and it'll provide a better standard of living than what I used to do ever did and it'll do it with less physical effort, less headaches, less worrying. As much as I hate to admit it, I'm glad oil has skyrocketed, when gas hit $3.50 a gallon and the materials I've had to buy doubling and tripling, I quit driving, saving myself $30 a day in gas alone, and now I focus on forex as much as possible. Good luck to all the traders out there
  • #28
  • Jun 22, 2008 6:09pm Jun 22, 2008 6:09pm
Quoting renegade7
Cool. Thanks for responding
Here the scoop on the first house I did.
These prices will make you laugh. Remember this was in 1971 and in a location (Texas) where property was cheap.

I bought an old frame, 2 bedroom house for $5,000.

It looked like heck. It needed paint inside and out. It had hardwood floors that looked like someone had urinated on them every day for years. The bathroom fixtures were rusted. The sink was lopsided on the wall.
The yard was grown up with nettles. I don't know the last time it had been mowed.

It was structurally sound. There was no rotten lumber in it. The roof was ok.

I couldn't even move anybody in to it as it was.

I painted it, inside and out. Hired a guy to grind the floors and refinish them.
Resurfaced the tub, put in a new sink.
Tilled up the yard and sewed bermuda grass. Planted some flowers (wife).
Did a few more small things. It looked good.

I moved people into it on a 1 year lease. I moved them in at the rental I had targeted.

I sold it in less than 6 months for 15,000.

I had spent less than 1,000.

I netted about $9,000.

I was hooked. In 1971, that was a fortune
  • #29
  • Jun 22, 2008 6:25pm Jun 22, 2008 6:25pm
Quoting billbss
Here the scoop on the first house I did.
These prices will make you laugh. Remember this was in 1971 and in a location (Texas) where property was cheap.

I bought an old frame, 2 bedroom house for $5,000.

It looked like heck. It needed paint inside and out. It had hardwood floors that looked like someone had urinated on them every day for years. The bathroom fixtures were rusted. The sink was lopsided on the wall.
The yard was grown up with nettles. I don't know the last time it had been mowed.

It was structurally sound. There was no rotten lumber in it. The roof was ok.

I couldn't even move anybody in to it as it was.

I painted it, inside and out. Hired a guy to grind the floors and refinish them.
Resurfaced the tub, put in a new sink.
Tilled up the yard and sewed bermuda grass. Planted some flowers (wife).
Did a few more small things. It looked good.

I moved people into it on a 1 year lease. I moved them in at the rental I had targeted.

I sold it in less than 6 months for 15,000.

I had spent less than 1,000.

I netted about $9,000.

I was hooked. In 1971, that was a fortune
So multiply by 10 for todays figures (If not more, considering a movie was 10 cents "back in the day"...at least from what I've heard, hah!)

Were the renters to cover the house just sitting there while it was on the market (your original plan) or for income? And how many of these did you end up doing? (Not a number figure, just wondering if it was easy to find those types of properties). Now'a'days I'd figure it'd be harder since flipping has been made popular by various media outlets...
  • #30
  • Jun 22, 2008 6:39pm Jun 22, 2008 6:39pm
You guys can have all the real estate you want, put up with the crappy tenants, taxes, and maintenance......... and illiquidity...
I will stick with highly liquid investments.
Same Whore .... Different Dress
  • #31
  • Jun 22, 2008 6:40pm Jun 22, 2008 6:40pm
Quoting renegade7
So multiply by 10 for todays figures (If not more, considering a movie was 10 cents "back in the day"...at least from what I've heard, hah!)

Were the renters to cover the house just sitting there while it was on the market (your original plan) or for income? And how many of these did you end up doing? (Not a number figure, just wondering if it was easy to find those types of properties). Now'a'days I'd figure it'd be harder since flipping has been made popular by various media outlets...
I rented it out to make it more attractive to a buyer of rental property, and to pay my note and recoup my expenses.

I was new at it and thought it would take a year or two to sell. If I had it to do over again, I wouldn't have rented it at that point, because I was eliminating possible buyers who wanted to live in it. I would have put it on the market. It worked out though.

I did about six of them between 1971 and 1973 or 1974.

I have no idea how hard it would be today. I haven't been close to that business in years.
  • #32
  • Jun 22, 2008 6:42pm Jun 22, 2008 6:42pm
Quoting johnedoe
You guys can have all the real estate you want, put up with the crappy tenants, taxes, and maintenance......... and illiquidity...
I will stick with highly liquid investments.
Highly liquid?
You mean bootlegging whiskey?
  • #33
  • Jun 22, 2008 6:46pm Jun 22, 2008 6:46pm
Quoting renegade7
Controlled risk isn't gambling. Gambling is gambling.

I agree with that; but also gambling seldom involves
skill. A consistent successful trader doesn't become so
by chance, rather he/she does so by skillfully applying
knowledge. Even formulating his/her own trading
system.

..
  • #34
  • Jun 22, 2008 6:52pm Jun 22, 2008 6:52pm
Quoting billbss
Highly liquid?
You mean bootlegging whiskey?
Whatever floats yer boat........
Same Whore .... Different Dress
  • #35
  • Jun 23, 2008 12:06pm Jun 23, 2008 12:06pm
i'm a college student.

have studied forex for around 2 and a half years, blew my first account a long time ago by not knowing what do do.

i also have a part time job from which i pay my expenses and put away every month a bit to invest in forex(money i can afford to lose). it builds up. i will be going live again with $500 for a start, trading micro-lots.
Twitter: @forexpokerpro
  • #36
  • Jun 23, 2008 6:36pm Jun 23, 2008 6:36pm
LOL!!!!!!!!!! this is quite possibly the most retarded arguement i have evr heard in my life. you should NEVER try and hit it big. if you try and hit it big, you will ALWAYS lose. i dont mean right away, it could take a few trades or whatever, but the fact is, if youre looking for that one big winner, you will end up with that one big loser. it's just how this thing works. the ONLY way to be succesful in the forex market is to build up your account slowly. you will lose a lot less money and you will make a heck of a lot more. always use money management, never go more than 1 to 3 percent of your account. this way, you limit your losses and you wont be in the position to lose your whole account. it will take a lot longer to build up your account, but remember, THIS IS NOT A CASINO!!!!!!! you are not here to gamble. you are here to make money, am i right? so dont gamble. find a system and go with it.
  • #37
  • Jun 23, 2008 6:36pm Jun 23, 2008 6:36pm
Ignore that last post, i posted it in the wrong section
  • #38
  • Jun 23, 2008 6:42pm Jun 23, 2008 6:42pm
Quoting blacksun1
Ignore that last post, i posted it in the wrong section
I hope you don't make this kind of mistake when you are trading.........
Same Whore .... Different Dress
  • #39
  • Jun 23, 2008 6:45pm Jun 23, 2008 6:45pm
yes, i always post my arguements on the wrong charts. it sucks.
  • #40
  • Jun 23, 2008 6:48pm Jun 23, 2008 6:48pm
I have done the same so I'm just laughing with you........
Same Whore .... Different Dress
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