Getting started in real estate investing

Jan 13 12 Comments

If you have owned a rental property in the past - what was your experience like? Where was it? Would you do it again? Was it profitable beyond the returns you would have recieved in the stock market? How did you get started the first time?

Thanks

comments

Want to comment? LOG IN or SIGN UP
TOP 12 Comments
    • Google hi?
      OP
      First of all, if I had to put $500k down for $2k rent, it’s not a property I’m interested in. Secondly, 3% per year is not at all unusual by historical standards. Furthermore, of course if you buy and sell every 5 years it will be a bad investment - most people who own rentals buy and then never sell! Lastly, AND BY FAR THE MOST IMPORTANT, this COMPLETELY ignores the leverage! I only need to put 20% down on a house! So if I put 100k down and in 5 years it sells for $580k, that’s not a 16% return, that’s an 80% return! This article is so fucking stupid. Very clearly biased to get you to keep your money with wealthfront.
      Jan 14
    • Walmart QTFP86
      OP is right, this article is BS, no seasoned investor will ever keep flipping rental property unless it turn out to be too bad to maintain. Even in worst case I will rather hold as I would have invested in upgrading and property taxes goes up with putting every new costly chunk in your portfolio so why not to pay less property tax as that if older date when I bought it. I could be oversimplifying property tax here but that is a factor to note.
      Jan 14
  • Google hi?
    OP
    “Imagine you bought a house or condo for $500,000 and financed it with a mortgage of $400,000 at a 30 year fixed rate (with no points) of 3.8%. Your monthly payment would be $1,864. Your monthly real estate taxes would probably be at least $400. You should also factor in monthly upkeep and insurance, meaning you’d need to charge a monthly rent of almost $3,000 just to break even.” Not even their problem statement is correct. The mortgage principal payments are going to your equity which you own !! - they aren’t just disappearing! Sheesh this article is horrible in every way. What terrible analysis.
    Jan 14 2
    • Hi? I see your point. Thanks for helping us newbies
      Jan 14
    • Tableau dvTr65
      I think their point is that you won't be cash positive for a while. And don't forget that on a 30y mortgage, the portion that goes to your principal is small....the major part goes to your bank.
      Jan 14
  • My.com sAui57
    What is prop13 rollback?
    Jan 13 1
    • Walmart QTFP86
      There was a law enacted somewhere in 1978 in California about capping the property tax to 1% to some additional assessments but not beyond 2% something like that(best google it, I know there is a law but I may not be articulating it right)
      Now socialists wants to raise this tax to generate new revenue sources for cities, it is a disastrous but some sections are arguing about doing it selectively for rental properties or firms but you never know who they will throw under the bus at last moment. Sometimes the fear is, even normal homeowners will be subjected to prop13 rollback, that will be disastrous...
      Jan 13
  • Walmart QTFP86
    Will limit the answer to my experience. You can take a deep into real estate market but do not compare it with other investments. Taxation, returns, how much degree of passiveness all aspects are totally different if you are comparing with stocks for an example. Think of it more like a mere different bucket instead of keeping all eggs in same bucket. What return one got in different time frame will not be a better reference for you to draw any conclusion but learn from those experiences to be alert.
    Spend time in understanding zoning, demographics of area, taxation before jumping in for bigger pie. If you are renting small property, returns are great but as soon as that clout becomes bigger you need to keep more capital aside as a operation costs.
    If you are in California, keep eyes and ear open over crazy idea of prop 13 rollback and selective rollback on rental properties...
    Some more adventures venues are foreclosure properties if you have enough cash and got enough semantics of real estate.
    Jan 13 0

Salary
Comparison

    Real time salary information from verified employees