theJ Posted May 21, 2018 Share Posted May 21, 2018 33 minutes ago, cddolphin said: I have a family member who had a PM company charge 8.3% annually, one month's rent; 30% hardly seems like it would be viable at any level. Sorry, i didn't explain that well. What i meant was that if you get a steal up front, then you're not making 10% on rent, but 30%. If a rental agency takes 10%, you're still making 20%. Link to comment Share on other sites More sharing options...
cddolphin Posted May 21, 2018 Share Posted May 21, 2018 3 minutes ago, theJ said: Sorry, i didn't explain that well. What i meant was that if you get a steal up front, then you're not making 10% on rent, but 30%. If a rental agency takes 10%, you're still making 20%. Okay, that makes sense, and it fits perfectly with the example I posted, his mortgage is $650 monthly and he's renting it for $1,100, now of course that's after like a decade and a half of mortgage payments. The margins were undoubtedly not as good when he first purchased the house. Link to comment Share on other sites More sharing options...
theJ Posted May 21, 2018 Share Posted May 21, 2018 7 minutes ago, MikeT14 said: I agree. I'm not...yet. But like a retirement account, it IS an investment that down the road I think will payoff. Like I said, after a couple years of it getting paid down, and a refi that benefits me, it could turn into a monthly cash pull. That's what I am hoping at least. Got to start somewhere. If you still have it mortgaged, then yeah it's tough at the beginning. The two things that turn a single rental into a cash cow are: 1) getting a steal up front on the purchase and 2) not having a mortgage. If you owe the bank 4-5% monthly, that could be half your profit. Link to comment Share on other sites More sharing options...
theJ Posted May 21, 2018 Share Posted May 21, 2018 1 minute ago, MikeT14 said: I agree. I'm not...yet. But like a retirement account, it IS an investment that down the road I think will payoff. Like I said, after a couple years of it getting paid down, and a refi that benefits me, it could turn into a monthly cash pull. That's what I am hoping at least. Got to start somewhere. If you still have it mortgaged, then yeah it's tough at the beginning. The two things that turn a single rental into a cash cow are: 1) getting a steal up front on the purchase and 2) not having a mortgage. If you owe the bank 4-5% monthly, that could be half your profit. Link to comment Share on other sites More sharing options...
ramssuperbowl99 Posted May 21, 2018 Share Posted May 21, 2018 52 minutes ago, theJ said: The only way to make this workable is if you get a steal on the upfront purchase. Then your 10% is 30% and you can afford the rental agency. But that takes experience in the industry, and patience. This is why I'm more of a fan of mutual funds as investments for most people. If you have a $5M nest egg and have the capacity to diversify across a lot of different units, then I think real estate makes a lot of sense. Average Joe with a rental is putting a lot of risk on that one unit. Link to comment Share on other sites More sharing options...
theJ Posted May 21, 2018 Share Posted May 21, 2018 5 minutes ago, ramssuperbowl99 said: This is why I'm more of a fan of mutual funds as investments for most people. If you have a $5M nest egg and have the capacity to diversify across a lot of different units, then I think real estate makes a lot of sense. Average Joe with a rental is putting a lot of risk on that one unit. That's very true. Someone with a few hundred thousand in his retirement and a rental has a big chunk of his portfolio in one asset. That's dangerous. Link to comment Share on other sites More sharing options...
Cheesehawk Posted May 22, 2018 Share Posted May 22, 2018 Good to know I'm the resident peasant of FF. Link to comment Share on other sites More sharing options...
skywindO2 Posted May 22, 2018 Share Posted May 22, 2018 1 hour ago, packerrfan74 said: Good to know I'm the resident peasant of FF. Silence, serf! Link to comment Share on other sites More sharing options...
cddolphin Posted May 22, 2018 Share Posted May 22, 2018 2 hours ago, packerrfan74 said: Good to know I'm the resident peasant of FF. You live in (presumably) the USA or Western Europe in the 21st century. You are the 1% of the 1%, historically Link to comment Share on other sites More sharing options...
Malfatron Posted May 22, 2018 Share Posted May 22, 2018 3 minutes ago, cddolphin said: You live in (presumably) the USA or Western Europe in the 21st century. You are the 1% of the 1%, historically and the 99% percentile of FF. Link to comment Share on other sites More sharing options...
cddolphin Posted May 22, 2018 Share Posted May 22, 2018 4 minutes ago, MathMan said: and the 99% percentile of FF. So can I spit on him as he passes if I'm in the 82% percentile? Link to comment Share on other sites More sharing options...
Cheesehawk Posted May 22, 2018 Share Posted May 22, 2018 15 minutes ago, cddolphin said: So can I spit on him as he passes if I'm in the 82% percentile? Spit on me all you want, I'm blessed to be in the presence of the upper echelon. Link to comment Share on other sites More sharing options...
VikeManDan Posted May 22, 2018 Share Posted May 22, 2018 On 5/18/2018 at 3:36 PM, ramssuperbowl99 said: https://www.bogleheads.org/wiki/Health_savings_account They're amazing. Potential retirement account money that you can invest for years and never pay taxes on it. Provided you're withdrawing after age 65 correct? Link to comment Share on other sites More sharing options...
JaguarCrazy2832 Posted May 23, 2018 Share Posted May 23, 2018 On 5/22/2018 at 2:59 PM, VikeManDan said: Provided you're withdrawing after age 65 correct? Doesnt that account have to be used solely on medical stuff? You will be penalized if you spend it on something else Link to comment Share on other sites More sharing options...
ramssuperbowl99 Posted May 24, 2018 Share Posted May 24, 2018 On 5/22/2018 at 1:59 PM, VikeManDan said: Provided you're withdrawing after age 65 correct? No if you use it on medical expenses its never taxed regardless of age. If you're 65, you can roll it into a tIRA. Link to comment Share on other sites More sharing options...
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