re: Buying investment properties...

yeah. Im still renting well below market rate for where i am. Got a townhome with two other guys, i pay around $600 a month. 1 bedroom apartments(700square feet are going for $1500.

People brag on the market but there is a bubble buiding. Brand new 2000 Sq ft townhomes are being built and selling for $400k in areas around downtown where the previous property(SFH with a front and back yard) was selling for maybe $100k.

Builders are trying to keep up with demand. We are getting alot of people from areas of the country that have typically higher home prices. There is still so much of inner city Houston that is undevelped that once the housing catches up with demand that prices will begin to fall again. There are also alot of condo construction being built.

I know alot of newly maried couples that have bought recently. But within 5 years they will have kids and need more space, no telling what the resale will be.

I have thought about buying the Woodlands as an investment.

post those pics of your property I Love Bama

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post those pics of your property I Love Bama

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I can't believe anyone believes that ILB, who was bragging just a year ago about going from being an intern to having a big boy job, has a real estate portfolio that would rival Donald Trump.

He very well may have bought A rental house but he obviously talks more than he walks and from me being in this business for the past 15 years I feel sorry for anyone that takes his advice. A lot of it is off base or stuff regurgitated from infomercials.

BTW, rentals suck and the average person isn't getting rich off of them because banks aren't going to just give you an open checkbook to buy enough to generate serious monthly income. You may make some steady money but it's a lot of headache IMO. The only way I would do it is if I set up a plan where I get my 10 year depreciation off of them then flip them on year 11. You would have to start buying a few a year though to get to that point. I was going to do this and use the ones I flip in year 11, 12, 13 etc as my retirement but then I had something bigger come along I put money into. Even doing that I would turn it over to a management company to deal with the headaches for me but then again I hate people so it just isn't for me.

I would rather owner finance with $5K down and nail them on rates and late fees. I have 4 I have done this on. One of them I have had for 12 years now and the people always pay late but they always pay eventually. The good thing is that they are no where closer to paying it off than they were the day they bought it because of late fees. The greatest beauty of it is that they also pull their own maintenance so no 2 A.M. calls that their A/C is out or some bullshite.

There are plenty of oil field trash and plant workers around here that can afford the $5K down and monthly notes but because of poor life choices and/or an ex-wife they have horrible credit and can't buy through a bank.

One of my friends actually wrote a book about this very thing. He owns over 65 owner finance properties now. He has owned rentals including whole apartment complexes and he dumped them because of the headaches of rentals vs owner financing.

I only do this on properties I get cheap enough though. I flip anything else and mostly build on spec.

My friends book

My uncle owned a mobile home park. His only gripe was that when he bought it there was some park owned units he had to deal with renters on. He eventually got rid of them and just went to lot rentals which is less of a headache but will still have some management time. His biggest headache was collecting rent. Not to stereotype just to do it but you aren't dealing with the most upstanding citizens when it comes to a mobile home park.

I would also imagine the insurance premium on a park is fairly high. I wouldn't allow anything bigger than a house dog for one to keep that liability down.

How can you get it ready for $30K? A multi unit sewer system costs that much alone much less other utilities. Just curious.

Being a mcneese grad I hear where you're coming from. I'd love to own a place like sugarloaf. I think it's sugarloaf. On 14?

What does a management firm usually charge? I'm guessing around 7-10%?

I had a 8 % monthly management fee in BR.

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Or you just looking for cash flow if so build out storage units and leave space for people to park stuff, very good cash flow.

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Storage units suck. You are collecting very little money from a lot of people. It's not a bill that's a high priority for people to pay every month. Also, when people need to cut bills out storage units are one of the first things to go. I know because I used to have some and when the economy tanked people came and got their stuff and I had units sitting empty.

I disagree, it's all I'm doing right now new. I like how when a tenant leaves it doesn't hurt, you have a retail or office tenant leave and you spend all that money on TI and brokers fee getting a new one not to mention the money lost with a vacancy. You lose some and you get some new tenants all the time storage units. My favorite part is the rv and boat parking outside that you get paid on for without any buildout . Plus there are bigger groups buying up well run facilities right now at $35-$40 SF so you just need to build under that. Also they are easy to run you just have one guy in a apartment that keeps it maintained. May not work everywhere but they key is to build near high concentrations of multi families seems to work best. Buying land cheap in good proximity is the biggest challenge.

Also i would only do bank drafts, never leave it as a bill to pay. I found people moving and downsizing during the downturn made vacancys lower?

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I'm not putting a permanent building on that property. Less than a quarter mile away will be a walmart going up (carencro)

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In that case if it has road frontage you need to get a alta survey and pitch it to every national credit tenant you can think of (aldi, jiffylube is expanding, ect ect) and hit a lick and 1031 that money into a better project