re: Pro's & Con's of Investing in Real Estate

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but nobody has really sold me that RE isn't vastly overpriced and facing a massive correction the next 18 months.

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you have been saying this for how many years in a row now?

yea I don't disagree with what you're saying. there are definitely superior investment strategies out there in 2021

if these big real estate guys were smart they'd consider liquidating some and then moving that into Bitcoin and then collecting interest on their holdings.

far superior and less maintenance and overhead. I'm assuming many are doing it right now. could be the catalyst to correct the real estate market

Good to hear. It seems like one of the few areas you can get close or at 1% rule in town. Other than some select cases in university area, where I currently have enough exposure.

I have zero idea how 2% is possible in any of the markets I buy in. 1% is only possible on properties in the $100k to $200k range.

2%+ you have to be slumlording it up or running a super profitable Airbnb/VRBO.

For example, we will hit 1% in our $160k SFH.

We have a good shot of hitting 1% in our $500k duplex. But that's only thanks to the location and VRBO.

Yea in my hood you'd be lucky to get .5 or .6%

Thanks will do.

if the city ever makes moves on that abandoned naval port on poland, look out

those massive warehouse buildings are very popular right now. shopping. housing. coffee. miss river views etc

so much potential just sitting there rotting away

Oh ok my bad

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Can you expand on the tax part a little? Thanks

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This is really is applicable to any small business, but real estate has a few unique items

Anything that can be conceived as “for the business” should be billed/filed as “for the business”

Mileage
Meals (needs to be “ftb”)
Tools
Fees
Insurance
Mortgage interest
Office
Office bills


Any money spent going into the property is either going to be a write off or a depreciation item.

You can depreciate the property over 27.5 years, not including land cost.

If you do it right every dollar made in rent should be offset by deductions. Ideally you’re able to lower your taxable income from the 401k job.

A good cpa is a must, but Uncle Sam wants you in real estate.




There are deals still out there and homes in most areas that can fit inside the 1% rule. How hard are you looking? Seriously, if you could land a 1% rental by opening Zillow 10 minutes a day, wouldn’t other people do the same? Are you willing to drop 30/40k on a house that needs a lot of work? Are you driving the neighborhoods looking for homes not being kept up?

I found and bought house #1 through word of mouth and had financing lined up when I went speak with them. House #2 is abandoned, I’ve secured a handshake deal, just waiting on life to slow down a bit. I’ve found 2 other homes off market that could potentially fit. I’ve left the sellers alone, because I’ve already got more than I can handle. There’s definitely homes within 60 miles of most people.

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I wouldn't touch anything with office/retail.

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what I see every day is a severe shortage of good warehouse space.
warehousing with modern lighting, sprinkler and dock equipment is in high demand and getting top dollar

if I were investing in RE that’s what I would build/buy