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re: If you had a million dollars to invest
Posted on 10/12/17 at 6:59 pm to MadDoggyStyle
Posted on 10/12/17 at 6:59 pm to MadDoggyStyle
I like real estate, so if I had a mill I'd be looking at rentals as well.
Invest in what you know. I farm, so I know farmland and what it is (or isn't) worth.
Invest in what you know. I farm, so I know farmland and what it is (or isn't) worth.
This post was edited on 10/12/17 at 7:00 pm
1
Posted on 10/12/17 at 7:22 pm to SoFunnyItsNot
quote:
cant afford to lose huh. well not stocks
I usually don't correct people on TD about money, but let's take you to school.
You look back at the history of the overall US stock market and negative returns, over long periods of time, are extremely hard to find.
Over all historical rolling 10 year periods ('89-99, '05-'15, etc...), the market is positive ~95% of the time. Over rolling 5 year periods the market is positive ~89% of the time. Even rolling quarterly returns are positive ~68% of the time.
You just don't know how to invest your money with discipline.
Posted on 10/12/17 at 7:54 pm to LSUcam7
And to take your point even further. If you had to make this decision exactly 10 years ago at the peak of the marke and before the crash, of where to invest your money can you take a stab at what had the best returns 10 years later? It wasn’t CD’s, wasn’t treasuries, wasn’t real estate.. LINK
Posted on 10/12/17 at 8:53 pm to Shepherd88
Exactly.
Although there's a place for those investments for safe returns and diversification.
But if you don't have a respectable amount of your liquid assets in common stock, you are probably doing yourself dirty.
Although there's a place for those investments for safe returns and diversification.
But if you don't have a respectable amount of your liquid assets in common stock, you are probably doing yourself dirty.
Posted on 10/12/17 at 9:02 pm to rocket31
quote:
not sure why anyone is investing in real estate in 2017?
what 5% gain per year?
lol
joke's on you pal. you know how I know you do not know shite about RE? Myself and steventiger and even that bama guy have only explained it ad infinitum and you still do not get it? wow. but please continue. this is entertaining.
Posted on 10/12/17 at 9:09 pm to Fat Bastard
quote:
you know how I know you do not know shite about RE?
oh please explain how RE is better than the 500% ive made sitting on my arse investing in BTC this year
this will be amusing
Posted on 10/12/17 at 10:15 pm to Decisions
What kind of realistic ROI should one expect in rental units after all expenses?
This post was edited on 10/12/17 at 10:37 pm
Posted on 10/12/17 at 10:18 pm to MadDoggyStyle
quote:
What karl nd of realistic ROI should not ne expect in rental units after all expenses?
cash on cash return %? my properties are in the twenties. i have one in the thirties. That does not even account for appreciation. straight positive cash flow also.
This post was edited on 10/13/17 at 8:09 pm
Posted on 10/12/17 at 10:35 pm to Fat Bastard
How do you figure your ROI on a rental? Say you purchase at $100,000 and rent for $1,000.00/ month. You don't start positive ROI until house is paid for in 8.3 years. If it appreciates then great but where is the great return on RE? Not being obtuse, I just don't see it when you consider taxes, upkeep and risk.
This post was edited on 10/12/17 at 10:37 pm
Posted on 10/12/17 at 10:38 pm to hey benji
I'm close to NOLA and intrigued. Sell me
Posted on 10/12/17 at 10:43 pm to MadDoggyStyle
Listen to FB. Read his RE investing thread and the links. It's gospel. It's also why I'd recommend those properties over farmland ATM, even though that is my personal expertise. Occasionally you'll hear of a good deal in farmland, but most people are doing well for the land to pay for itself and the interest on the loan, much less make double digit ROI's.
Posted on 10/12/17 at 10:49 pm to Decisions
I'm listening, just not seeing the light yet. Seem's like a damn long time to reach the point where you are making a profit on rental units after taxes and expenses.
This post was edited on 10/12/17 at 10:50 pm
Posted on 10/12/17 at 10:52 pm to MadDoggyStyle
quote:
Say you purchase at $100,000 and rent for $1,000.00/ month.
For ease of math let's assume you have no other expenses. That's 12k a year on a 100k investment, i.e. a 12% annual return. Assuming you could always sell the house for at least what you paid for it (and hopefully more) that is all profit and positive ROI. It's like buying a dividend paying stock, in a sense.
12% ROI is pretty far above stock market average, and as we said it's not even accounting for appreciation of the asset. Taxes and upkeep will cut into the profits a bit, but it shouldn't be anything serious. The risk is certainly no worse than that of owning stock in a company that goes bankrupt.
This post was edited on 10/12/17 at 10:56 pm
Posted on 10/12/17 at 11:05 pm to Decisions
The problem with real estate that I have is these deals are a) never in my area and b) require a ton of up front capital. If I wanted to get 1,000 a month for a place I'd need to spend 225k.
Posted on 10/12/17 at 11:09 pm to Decisions
quote:
For ease of math let's assume you have no other expenses. That's 12k a year on a 100k investment, i.e. a 12% annual return. Assuming you could always sell the house for at least what you paid for it (and hopefully more) that is all profit and positive ROI. It's like buying a dividend paying stock, in a sense.
12% ROI is pretty far above stock market average, and as we said it's not even accounting for appreciation of the asset. Taxes and upkeep will cut into the profits a bit, but it shouldn't be anything serious. The risk is certainly no worse than that of owning stock in a company that goes bankrupt.
Posted on 10/12/17 at 11:30 pm to LSUtoOmaha
Lots of people certainly go where the deals are, but it could also be as simple as coming up with a new, more intensive use for an old piece of property that no one really wants. "Hit 'em where they ain't" ...so to speak.
Posted on 10/13/17 at 8:06 pm to MadDoggyStyle
quote:
How do you figure your ROI on a rental? Say you purchase at $100,000 and rent for $1,000.00/ month. You don't start positive ROI until house is paid for in 8.3 years. If it appreciates then great but where is the great return on RE? Not being obtuse, I just don't see it when you consider taxes, upkeep and risk.
sorry I should have clarified. COC return. That is the great return. Those are the percentages i gave you. COC return and PCF is what matters. every expense is accounted for in PCF.
Those are the best two metrics to use. You want a good COC return and a good PCF. I am not quite sure why you are not grasping this. it is all in the numbers game. You need to find good deals, have good rents, run expenses, see what amount you want to put down and see what the PCF would be on an average basis. Depends on what PCF number you want to hit relative to what you want to spend on the deal. I have my own minimum numbers for certain price points. you take PCF and divide by cash invested and that gives you the COC return. see link below.
LINK
This post was edited on 10/13/17 at 8:57 pm
Posted on 10/13/17 at 8:32 pm to MadDoggyStyle
quote:
Seem's like a damn long time to reach the point where you are making a profit on rental units after taxes and expenses.
huh? You are making profits from day one if you buy right. Let's say you buy a stock for 25k. It does not move much but is paying a nice dividend. you are making profits on that from the first dividend. You seem to be mixing up profits with 100% returns on investment. You expect to get 25K profit on that 25K stock you bought? 100% return? you might over a period of time. same with real estate. A down payment on a home is no different than buying that stock. great returns/profits relative to what your COC return is and PCF is IF you buy right. they are both related. FInancing a home gives you tons of leverage and increases your COC return versus a cash buy. Then all the tax benefits RE gives yo not to mention equity/principal paydown your tenants do for you.
This post was edited on 10/13/17 at 9:04 pm
Posted on 10/14/17 at 8:26 pm to Fat Bastard
My million is invested 1/2 in Vanguard Wellington, and 1/2 Wellesley.
Posted on 10/15/17 at 2:04 am to MadDoggyStyle
Bitcoin
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