Since I know Salty is a realstate agent...OT
02-19-2005, 08:30 AM
#1
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Since I know Salty is a realstate agent...OT
My sister recently bought a house in central Austin. It cost her a decent chunck of money. So I started looking around to see how much I would have to save up to buy a house down there. I quickly realised that unless my future wife makes double what I make I won't be living in the place that I want. http://www.realtor.com/FindHome/Home...7&lnksrc=00001
Anyways I started thinking of ways of making money in the long run. And well concidering how many houses my parents have I decide to look into that. (I can fix almost anything on my own.) I just put in 0-50,000 range on condo's on a website. I got over 30 condo's that came up. This got me started on buying four of them and putting down 10,000 each and renting them out. (Sell the wrx, buy a civic...) And rinse and repeat. I figure give me a couple of years and I would have a decent income from the rentals that I could use to buy more.
My question for Salty is this a good idea? Will the taxes kill me eventually? Tenants? He have the same idea? And has anyone else done this here?
Anyways I started thinking of ways of making money in the long run. And well concidering how many houses my parents have I decide to look into that. (I can fix almost anything on my own.) I just put in 0-50,000 range on condo's on a website. I got over 30 condo's that came up. This got me started on buying four of them and putting down 10,000 each and renting them out. (Sell the wrx, buy a civic...) And rinse and repeat. I figure give me a couple of years and I would have a decent income from the rentals that I could use to buy more.
My question for Salty is this a good idea? Will the taxes kill me eventually? Tenants? He have the same idea? And has anyone else done this here?
02-19-2005, 10:11 AM
#2
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You're basically going to have to compare apples to oranges in your personal fiances and your purposed finances. Typically, you're looking at covering the essentials for the renter or else renting isn't going be attractive. This includes non-luxury expenses like garbage, water, sewer, Home Owner Association (HOA) dues (usually required for condos), and property management dues if you're out of the area as the landlord. The difference in these fees from the rent has to be eventually made-up in the housing market or else there's no point in investing.
Just because you've found 30 condos in the 0-50,000 range does not mean it's a good deal in regard to it's housing and rental market. For example, The rental market is a bit weak in my immediate area and condos can sometimes sit for 6months or longer before a renter knocks on the door. If you consider the long-term you may be looking at 50% occupied properties and a tighter wallet. You don’t want to bank on that happening.
If you can manage the expenses by giving-up current luxuries like the WRX, you may be able to get your hands on a lower, short-term mortgage/rate in order to get your hands on the deed quicker (I wish condos sold for that price here). You'll own the subject property faster and pay less on interest in the long run. BUT your monthly payments will be fatter which may force you into holding off for the rinse and repeat portion.
So the absolute key is the housing market first http://money.cnn.com/pf/features/lists/nar_4q/ and the rental market at a very, very close second. It's best to find where you want the property to be first... preferably somewhere that has serious potential and an area where the housing market hasn't shot through the roof yet (you want to be there when it does
). Then call a realtor in that area in regard to property management, how strong the rental market is and so forth. My wife can help you find a person to give you a investment package once you've narrowed your search if you'd like?
My, Mother and VP of the company I work for just bought 10 homes in Tucson, AZ based on the very same idea and is planning on buying more. Those 10 homes got rented-out within a month. You see Tucson on that list? It's ranked at 24 with a relatively low average market values in comparison to the rest of the country (what you want). You can get a 2500sq ft home for abut 180-ish. It's sickening to me. But imagine if the housing market turns into another Northern California in that area like it's supposed to do. We're talking bank, my friend. You need to find a Tucson type area within your budget. Even if it means doing some serious homework in finding out why Tucson is such a hot spot and matching those characteristics in another area.
Just because you've found 30 condos in the 0-50,000 range does not mean it's a good deal in regard to it's housing and rental market. For example, The rental market is a bit weak in my immediate area and condos can sometimes sit for 6months or longer before a renter knocks on the door. If you consider the long-term you may be looking at 50% occupied properties and a tighter wallet. You don’t want to bank on that happening.
If you can manage the expenses by giving-up current luxuries like the WRX, you may be able to get your hands on a lower, short-term mortgage/rate in order to get your hands on the deed quicker (I wish condos sold for that price here). You'll own the subject property faster and pay less on interest in the long run. BUT your monthly payments will be fatter which may force you into holding off for the rinse and repeat portion.
So the absolute key is the housing market first http://money.cnn.com/pf/features/lists/nar_4q/ and the rental market at a very, very close second. It's best to find where you want the property to be first... preferably somewhere that has serious potential and an area where the housing market hasn't shot through the roof yet (you want to be there when it does
). Then call a realtor in that area in regard to property management, how strong the rental market is and so forth. My wife can help you find a person to give you a investment package once you've narrowed your search if you'd like? My, Mother and VP of the company I work for just bought 10 homes in Tucson, AZ based on the very same idea and is planning on buying more. Those 10 homes got rented-out within a month. You see Tucson on that list? It's ranked at 24 with a relatively low average market values in comparison to the rest of the country (what you want). You can get a 2500sq ft home for abut 180-ish. It's sickening to me. But imagine if the housing market turns into another Northern California in that area like it's supposed to do. We're talking bank, my friend. You need to find a Tucson type area within your budget. Even if it means doing some serious homework in finding out why Tucson is such a hot spot and matching those characteristics in another area.
02-19-2005, 01:22 PM
#5
I'd do it, the only problem is always having tenants, I have a friend here who at 25 just bought his second house for 550,00. He bought his first and rented it to some friends who paid the mortgage plus. While renting a room at his sisters house. I dunno how the market is down there,but in the bay area it's off the hook, you can't really get anything right now for under half a million. My buddy bought his first home like 4 years ago for 375 and now it's worth 580.
02-19-2005, 06:02 PM
#6
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Originally Posted by Salty
Why on earth did your sister buy a $1.25 million property when she could of bought a similar home for $380? Wow.
Hehehe no she didn't buy a house for that much. (Her fiance is a bean counter.
) She bought it for around $380. (Yet WAY smaller and its a house.) Thats the place I want to live. Reason being right by all the night life and right by the green belt. (Hike and bike trails, pools etc...) And the view from that building is awesome! But its a pipe dream and like you stated not practical.
02-19-2005, 06:07 PM
#7
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Originally Posted by Salty
You're basically going to have to compare apples to oranges in your personal fiances and your purposed finances. Typically, you're looking at covering the essentials for the renter or else renting isn't going be attractive. This includes non-luxury expenses like garbage, water, sewer, Home Owner Association (HOA) dues (usually required for condos), and property management dues if you're out of the area as the landlord. The difference in these fees from the rent has to be eventually made-up in the housing market or else there's no point in investing.
Just because you've found 30 condos in the 0-50,000 range does not mean it's a good deal in regard to it's housing and rental market. For example, The rental market is a bit weak in my immediate area and condos can sometimes sit for 6months or longer before a renter knocks on the door. If you consider the long-term you may be looking at 50% occupied properties and a tighter wallet. You don’t want to bank on that happening.
If you can manage the expenses by giving-up current luxuries like the WRX, you may be able to get your hands on a lower, short-term mortgage/rate in order to get your hands on the deed quicker (I wish condos sold for that price here). You'll own the subject property faster and pay less on interest in the long run. BUT your monthly payments will be fatter which may force you into holding off for the rinse and repeat portion.
So the absolute key is the housing market first http://money.cnn.com/pf/features/lists/nar_4q/ and the rental market at a very, very close second. It's best to find where you want the property to be first... preferably somewhere that has serious potential and an area where the housing market hasn't shot through the roof yet (you want to be there when it does ). Then call a realtor in that area in regard to property management, how strong the rental market is and so forth. My wife can help you find a person to give you a investment package once you've narrowed your search if you'd like?
My, Mother and VP of the company I work for just bought 10 homes in Tucson, AZ based on the very same idea and is planning on buying more. Those 10 homes got rented-out within a month. You see Tucson on that list? It's ranked at 24 with a relatively low average market values in comparison to the rest of the country (what you want). You can get a 2500sq ft home for abut 180-ish. It's sickening to me. But imagine if the housing market turns into another Northern California in that area like it's supposed to do. We're talking bank, my friend. You need to find a Tucson type area within your budget. Even if it means doing some serious homework in finding out why Tucson is such a hot spot and matching those characteristics in another area.
Just because you've found 30 condos in the 0-50,000 range does not mean it's a good deal in regard to it's housing and rental market. For example, The rental market is a bit weak in my immediate area and condos can sometimes sit for 6months or longer before a renter knocks on the door. If you consider the long-term you may be looking at 50% occupied properties and a tighter wallet. You don’t want to bank on that happening.
If you can manage the expenses by giving-up current luxuries like the WRX, you may be able to get your hands on a lower, short-term mortgage/rate in order to get your hands on the deed quicker (I wish condos sold for that price here). You'll own the subject property faster and pay less on interest in the long run. BUT your monthly payments will be fatter which may force you into holding off for the rinse and repeat portion.
So the absolute key is the housing market first http://money.cnn.com/pf/features/lists/nar_4q/ and the rental market at a very, very close second. It's best to find where you want the property to be first... preferably somewhere that has serious potential and an area where the housing market hasn't shot through the roof yet (you want to be there when it does
). Then call a realtor in that area in regard to property management, how strong the rental market is and so forth. My wife can help you find a person to give you a investment package once you've narrowed your search if you'd like? My, Mother and VP of the company I work for just bought 10 homes in Tucson, AZ based on the very same idea and is planning on buying more. Those 10 homes got rented-out within a month. You see Tucson on that list? It's ranked at 24 with a relatively low average market values in comparison to the rest of the country (what you want). You can get a 2500sq ft home for abut 180-ish. It's sickening to me. But imagine if the housing market turns into another Northern California in that area like it's supposed to do. We're talking bank, my friend. You need to find a Tucson type area within your budget. Even if it means doing some serious homework in finding out why Tucson is such a hot spot and matching those characteristics in another area.
Thanks! Its just a idea for now. And I figured since I only have the experience with my parents I would get help from someone that does it for a living. (Btw my parents have a realtor but I don't trust him at all.) Im really concidering going to med school and thought this would atleast help me have some sort of income minus just student loans. Austin in general is pretty easy to find tenants since its a college town. (60,000+ students at UT alone.) But then the question is do I want to rent out to college students. Got to run but thanks for the info, you just made up my mind that I will like to do this but that I have to study the information and the market a lot more than I thought before I make the leap.
02-19-2005, 08:16 PM
#8
Originally Posted by Unregistered
Hehehe no she didn't buy a house for that much. (Her fiance is a bean counter. ) She bought it for around $380. (Yet WAY smaller and its a house.) Thats the place I want to live. Reason being right by all the night life and right by the green belt. (Hike and bike trails, pools etc...) And the view from that building is awesome! But its a pipe dream and like you stated not practical.
) She bought it for around $380. (Yet WAY smaller and its a house.) Thats the place I want to live. Reason being right by all the night life and right by the green belt. (Hike and bike trails, pools etc...) And the view from that building is awesome! But its a pipe dream and like you stated not practical.
02-19-2005, 10:35 PM
#9
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Originally Posted by Unregistered
And the view from that building is awesome! But its a pipe dream and like you stated not practical.
view? its texas.... its all flat. what's there to look at?
02-20-2005, 11:23 AM
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Originally Posted by Unregistered
Will the taxes kill me eventually? Tenants? He have the same idea? And has anyone else done this here?
Didn't really answer this. Property taxes can be easily calculated based on the local property taxes for the subject property area. This along with insurance will be added into the P&I payment when the deal is being made. Insurance can be expensive and it can be reasonable but isn't always needed in some respects. It can get costly if you’re in a flood area etc. These are part of the apples you’ll be comparing to the oranges.
As for tenants ... you can pre-qualify them on credit history, pets, number of dwellers etc. But you cannot discriminate on race.
02-20-2005, 12:56 PM
#15
Originally Posted by ish
view? its texas.... its all flat. what's there to look at?