My Plan B------> Real Estate

Does anyone think about selling their houses this year in anticipation of the big market crash coming? After 2008 I bought two houses for dirt cheap and they appreciated 40% since then. But one house I had owned since 2000 lost so much equity the whole package is a wash.

Should I sell everything wait for the crash and burn then swoop in like a bird of prey and make a killing on the next big upswing. Because I believe that after the next crash their will be so so many people who can't afford to buy anything so all they can do is rent for the rest of their lives. Hence landlords will make a killing.

 

Hard to give advice without asking more questions but here are some opinions.

If house bought in 2000 is breaking even or positive cash flow don't sell.

The other 2 homes you could sell and pay capital gains on profit or 1031 the proceeds but you would need to buy another home soon

Why not keep the homes, open credit lines on the homes and use the credit lines ONLY if the market crashes and you can get good deals. Assuming your mortgage is being paid by rents no reason to sell.

Landlords are already making a killing on properties bought in the last few years because rents increasing and less home buyers

 

You got 3 houses. Need only 1 to live in...Sounds like your primary/current home is just breaking even on appreciation..first? do you like living in it, the neighborhood, schools..can see yourself there for next 8 years? Yes. then stay the course pay it off sooner that later.

2 rentals..going like gangbusters up 40%! wow..talk to a professional tax accountant (ie. pay for some good advice, instead of these boards, real estate agent -guess what! its a great time to buy another house, will be their reply , Banker? guess what? great time to take out a Line of Credit or Loan is their reply..Stock jockey? Guess what..SELL! and BUY STOCK, mutual funds!)..

Do plenty of research and education..think of what 'you' want your money to be doing and what your comfort zone(s) are..Build a real plan for safety and growth (heck...do you have even enough basic life insurance? or 8 months living expense in cash in the bank?)

was a former rep, laid off, went into financial services (that is dog eat dog world) so know how the finance industry works-think used car lot and polyester leisure suits, now I'm out..you've got good problems to have..don't make a real problem.

 

Another winning plan I know a local guy pulls off is buying 50k ghetto homes and renting them out with a few grand of repairs. People in th low end have little options when it comes to buying so they will pay just a little more in rent because what else's do they know and how much comparison shopping do renters on the bottom actually do. I flipped lots of houses and I can not even explain the living conditions that most of the people out there love in. Dark rooms, dirty animals, food that's never cleaned up, beds and floors that are never cleaned. Buy at the bottom and rent to the bottom and never repair your jokes and you can MLS some great money. The guy I'm speaking about makes 500 a door on every ghetto home. I hate to say this but typically where I love you are looking for these houses in poor black neighborhoods. Find the worst schools and buy local to them.

 

The best part is the government pays the rent. Can anyone beat these deals. Buy for $15,000 put $10,000 in it for a total of $25,000. PAY CASH. Rent for $1250 a month. After taxes and insurance clear $1000 a month. Do this 2 to 3 times a year.

 

I'm out of pharma. What I'm doing is NOT for everyone but I think it's worth hearing about. Not saying real estate is bad, but exploring several options is wise.

Check me out at LifeAfterPharma dot com

 

OMG! What a scam! It should be scamafterpharma dot com.

 

For me the rule has always been to buy in a city where monthly rent can equal 1% of the purchase price. So I buy a 200k house and I get 2k in rent a month. I'm lucky I invest in the city I grew up in, it's in Virginia. I buy close to schools and rent out to students who live in absolute filth. I do few repairs and I don't get complaints. Usually I'm renting by the room so I make 400 to 550. Bedroom in a 4 or 5 bed house I buy for 200k. So it works well. Students are amazing. I had 3 boys renting and they had a flea infestation all semester but they never told me I found out their solution was to buy 50 flea collars on amazon and just throw them around the house. I had to spray at the end of the lease but that cost nothing. I never heard a single complaint from my student renters. Real estate is the way to go.

 

Well I'm about to get fired and all I can say is thank you lord I own three houses with no debt and I can lean on my 3500 a month of rental income to keep food on the table and not have to dip into my savings.

 

That's the reason to diversify and buy rental properties. Good for you. Now get another job and buy another 3 properties and next time there are lay offs you will have $7000 of rental income. I make considerably more income in rentals than collecting a paycheck. Paycheck allows me to purchase more rentals

 

Well I just cashed out my 401k and paid off my house and bought 2 condos to rent. The economy is going to blow up and the only thing that matters is owning something real.

 

yeah, real estate! 2007 is calling your name.

 

I wish I had the stats for how many fail vs. how many make it. On this site it seems like everyone makes money....you never hear from the ones who took a bath and tanked. I wonder what the true ratio is.

 

I will say this: real estate investment is much harder than getting your Viagra detail from the POA 1 meeting, and then going out and saying the exact same thing that has been said (in 40 second sound bites) since the drug was launched 18 years ago.

Our current business model is 2 to 3 years (max.) from imploding. Don't you read any trade journals or blogs? Soon pharma company field forces will be majority contract reps. And how do you think that decisions will be made on who stays? The same way that decisions were made about who got those coveted KAM slots, and who stayed "fired". If you think that you're playing it safe by just hanging on, you're gonna be in a lot of trouble.

Do your homework, or be the last one knocking at Publicus' door.

But don't whine about the riskiness of investing in real estate.

 

No longer in Pharma or knocking real estate. Was just wondering what the success rate is. You can also invest in a franchise as a business, but not all them succeed either. It was just a question-not a knock. No investment is all reward and no risks....right?

 

I own 35 properties. Do some people fail - of course. They fail because they watch the TV series which shows of a couple making $60,000 on a flip which takes 60 days. This is not reality in every market. I have bought properties which are mistakes but the mistakes are much less than the successes. I rent for cash flow and barely flip. If you have any business sense, learn the business from a mentor and have cash for emergencies, real estate investing in many markets is profitable. There are so many renters when I advertise a home for rent I get 20 calls a day. It is better than being a rep!

 

Owning 35 properties is awesome. At what point did you hire someone full time to manage it or did you just contract out to a property management company?

 

Manage myself, contract out the repairs. Having a sales job allows freedom to handle emergencies. Work nights and weekend handling small stuff and rehabbing new properties. 10 years of long weeks will allow me to live off the rental profit for the rest of my life.

 

You mean having a Pharma sales job allows it. Not many other sales positions allows you to work 10-2 and manage 35 properties. I hope you buy your DM a nice Christmas gift every year! He's either clueless or a real nice guy. Anyway-congrats on the success. Hope one of those properties is beachside!

 

Work 8-2. I have been upfront with all managers I ever had. Of course I do not tell them I am done at 2:00. One manager said you can't have a alot of properties it is another job. My response was if you have an issue with me than you have an issue with 20% of reps who own at least 1 rental property. These are investments. Never heard another word about it.