- Real estate as an investment reddit. Inexperienced investors can do very poorly. What are your overall returns on your properties, net taxes, maintanence, and other Pros of Real estate vs REITs: - Having the ability to buy small properties at a good price (large REITs won't compete to buy a $500,000 property) - You can live in the property you bought. Rates could be 6-7% by fall or winter. I spend less than 2 hr a week on real estate unless I'm looking to purchase a new property. Buy 1 house/duplex for primary with conventional loan for 5% down then buy another house/duplex with FHA for 3% down. r/realestateinvesting. it Not specifically real estate related, but Never Split the Difference is a good book on negotiation that you can apply any time that negotiation comes up in your life. ) If you are not residing in Japan, or if you do not own a Japanese company, then it will be almost impossible for you to get a Japanese bank account. This is just a basic amortization schedule that automatically creates itself based on the "Property Analysis" spreadsheet. Jumped head first into RE by liquidating my stock account and buying my first SFH in early 2020. I’ll continue to say it…. This drawback is the same for real estate and stocks: if you have $100k and borrow $100k to make a $200k investment, it it goes up 50% in value we'll have a 100% return (50->100) and if it goes down 50% in value we'll have nothing. Detroit is the most undervalued and under appreciated market today. As others have said, you better have a solid track record of prior deals or you are dead in the water. There are several good Houston real estate investing Facebook groups. ) Ditto for a Japanese bank loan. Owning where you live is a way to double dip the value of your investment, but just saying "real estate" is not helpful. Go Along with the Financial Plan. Buying that same townhome would currently cost around $1. . This is factored into the Net Worth section of the "Growth Projections" sheet. true. 2 - Incrementation. 5. It's one of the richest cities in the USA and rental demand in Houston is increasing steadily. There is considerably less risk and the house will never lose all of its value. Real estate requires work (no matter how minimal you think it is) while the stock market requires 0 work. When investing is talked about within the community it's painted with this rosy brush where investors Arrived Single Family Residential Fund Update. As An Aspiring investor you should make out time to attend as many networking events and investment clubs as possible. When you invest in a syndication, you are an partner in the deal, meaning you hold actual equity in a specific project/property. Stay away from Chicago. My total equity in these properties is about 60%. Bankrupt city and county and state. In my opinion, Cleveland is the best city in Ohio to invest in both residential and commercial properties. Yes it’s over saturated which means the ROI of real estate investments made today will likely be low. The opposite of that is Virginia-Highland, one of the leafiest, yet highest property values inside 285. It's a great read, I think anyone remotely interested in real estate should read it. You may find these links helpful: I am a bot, and this action was performed automatically. It is important before buying to make sure the HOA is healthy (reserve funds), there aren’t short term rentals, etc. Sales. 4K+ Fund investors. Investment properties, they use 75% of the reasonable theoretical rental price. However, the potential of returns is also lower. I followed his approach and I am happy with the results! Rich Dad's "ABC of Real Estate Investing". Investing in real estate means that you have full control of a tangible asset. Sam is one of the most colorful and successful real estate investors of our generation. Real Estate may seem like a good investment but considering it's low liquidity and taxes, maintainance and other legal formalities it often becomes a burden. How does someone start investing in real estate when there is such a high requirement for money down? Basically, to invest in a building that costs $1 million, the purchaser must have at least $500k cash in savings to commit to this investment (down payment, repairs, vacancy, legal costs, etc). You have 0 equity, and you can’t cash out refinance even if you did because the rates suck. While the property may appreciate in value, there is no guarantee of this. I see people saying banks won't lend, higher rates etc. I own a SFR, a STVR, and 2 four-plexes in a HCOL area. Houston is great for real estate investment. Keep in mind that 33% of Americans rent their home . redd. /s. Our family, like most families, started early on back when there were hardly any other investment options available, or of there were, it wasnt that popular yet. Smaller sizes are typically more profitable: As assets get in the $30M+ range, the cap rates compress as competition goes up. Please note that as a topic focused subreddit we have higher posting standards than much of Reddit: 1) Please direct all advice requests and general beginner questions to the daily discussion thread. Niharika_Saroj. https://preview. This tool provides a detailed real estate investment analysis, considering all potential income sources that the investment can generate and accurately calculates the ROI. Borrow at 2. We have an excellent credit (800+) score, enough for a 20% down payment for a home around $240k. In 5 years the rates go up and the prices go down. Indiana, and MI much better Midwest choices. I've read that real estate in the USA historically appreciates about 5 percent a year. Which means there are instances where it clearly is ethical. Earn 8+%. If RE investing is a means to an end, where the landlord is the means to by which the person who can’t qualify for a loan has a roof over their head then you have to ask yourself, is the end ethical rather than the means. The Book on Rental Property Investment by Brandon Turner and The Book on Tax Strategies by Amanda Han and Matthew McFarland. I have people go from $0-$1M in real estate in less then 60 months. If you have a solid career you can use your earned income to supercharge your investment portfolio. • 6 yr. Currently paying almost $4,400 for mortgage, maintenance fee, and property taxes every month. You won’t learn anything buying a condo, and a lot of time the HOA knows even less about home ,aintenance than you do (after all, they all bought condos too). 5% is $2100/month. Go through biggerpockets books, better than any course. 5. Investing in a syndication has massive advantages over REITs in terms of tax advantages. A bit pricey but they have tons of experience. After a year of working in real estate investment financing, I've begun to question the ethics of a majority of real estate investing. Interested in learning about people who are/were in small-scale real estate investment groups, and how I might start or join one. However, you could invest in Commercial through REITs ( passively). Too bad, so sad, for the property owner. At the end of 2028, he sells it off at 1. Aside from rental properties, we also did brokerage and buy and sell. Dec 28, 2023 · 1. To go full time you need to be committed. My net income on these properties stands at about $80K/yr. 5M+ invested. This includes beginner questions and portfolio help. From there raise capital either by yourself or through intermediaries. See how others are investing in real time. ) is 8%, before inflation/fees/trading costs/etc. My school offers principles of real estate, real estate finance, real estate valuation and investment , real estate development, and real estate financial decisions and i was wondering if these classes would help. Renting a townhome in our desired area costs between $3,800-$4,000. Hence this question. drnick5. Plus, you can write off all repair expenses and 1/27th of the depreciation of the home. 5-4%. That, and you will get benefits out of in person meetups that online just can’t emulate. Stay away. more skill based; a knowledgeable investor can better determine how to deploy their money. Bezos and Salesforce CEO Marc Benioff are backing a real estate investment firm called Arrived Homes. I am new to this, so i am trying to get a sense of what the returns are like. stock market returns (after the cost of fees, etc. ADMIN MOD. However, the interest rates we’ve been quoted have been the real killer for us. With the proper property management company you can mitigate a lot of the costs by utilizing their lower overhead to make up for the management fees. So my ROI on the investment is 100%+ (over the course of the investment) But yes. It's definitely not get quick. Personally I think it's an awesome business. Google will explain it more consumably than I can. Basically, you scroll through their app like Robinhood and pick out homes you want to put a small stake in. 5%. Zillow also has a MF search option for smaller buildings. I figured I could get a personal loan in the US, find an investor, or borrow from family. This means that you can invest in a vacation rental property without having to buy the entire property yourself. At 25% down the monthly costs for mortgage, insurance, and taxes were about $1,500 with a 4. Start with a Teeny – Weeny Investment. Plus tax credits. That's why I chose a college in a super wealthy area lmao. Assume we will get 12% appreciation for 15 yeas on this amount. Real estate investing is a simple business but it's not an easy one. I did not get rich. You've come to the right place! /r/realestateinvesting is focused on sharing thoughts, experiences, advice and encouraging questions regardless of your real estate investing niche! Structured Deals, Flipping/Rehabbing, Wholesaling, Lending, Land, Commercial Real Estate and more! If it has to do with real estate investing this sub is for you! Buy a ton of houses with 5% down. Edit: Overall, it sounds more like a new job than an investment. You’ll get shot in Chicago before you’re a climate refugee. It is a waiting game. If it has to do with real estate investing this sub is for you! Members Online Would you rather buy a overwater bungalow on a shallow turquoise waters that 15- 20ft above sea level or buy a beachfront house that’s 5-10 ft above sea level as an investment property or home that you plan to hold for decades to come. Honestly the trashier areas have the best cash flow (ie buy for $90k and rent for $1000/mo). - REITs can be be expensive/inexpensive at times (valuations are volatile), property prices Leveraging equity growth by refinancing your existing real estate. The mortgage payment on $300,000 at 7. $12. Rents are actually starting to go the other way. Yes, but not much as an investor you can do about the IRS. I'm eager to start building wealth in business ventures, and real estate is an interesting possibility. Yes at some point investing in commercial real estate is better that investing in residential, Below are some of the benefits of investing in commercial real estate. But if there's a deal between US and your country to avoid There’s nothing inherently bad about condos. It really depends. Compare owning $300,000 in real estate to I'm debating if now is a good time to buy in NYC. Choosing the Neighborhood. I tried being a landlord and it was the worst investment/experience in my life. 4. 5/month (you paid another 20) 2027: 5 lakhs 2028: 7 lakhs. I was evaluating investment option for REIT vs Real estate investment for ticket size of 75lakhs. Assume we get Rental yield ~3. The areas outside 285 are suburban and the inside 285 are slightly higher density. My plan is to finance, live there for a few years, and either rent or sell in 2 or 3 years when the market bounces back. I was not familiar with the mortgage on a property being a separate entity to the property for tax purposes, and any mortgage "profit" can not be offset by other capital losses (it must be booked as income when the mortgage is paid). Many REITs are publicly traded on major stock exchanges, and therefore open to Rates go up and down, and you can refinance at any time, but the price you pay is locked in forever. ) Agent's commission + other misc fees will come up to 4-5% of the transaction value. RE is mostly a good investment in select markets, but it's a lot of work and not for everyone. Reply. This sub's wiki. REI is about having capital, so you need all the money you can get OR you make friends that have a lot of money. About as legit as it comes and IMHO has been the best teacher of new investors for several decades. To earn the same return with real estate, I would need to get approved for a mortgage, hire a realtor, look at homes, hire an inspector, buy the house, hire a property manager Think of fires and natural disasters. Let’s say you buy now with high prices and low rates. You rates won't change if you buy a fourplex and you will not occupy whether it is under TL;DR: After working in real estate investment financing, I've started questioning the ethics of real estate investing. [deleted] • 1 yr. With 1. It can pay for your kid's education or for whatever fancies you and is still there for your retirement. Go on zillow and search for areas with homes that are renting monthly for 1% their purchase price. You can't buy 80% of a house to save money because the prices have gone up. ) So, amount paid as EMI in: 2024: 0 2025: 3 lakhs @ 25k/month 2026: 5 lakhs @ 25+16. Otherwise you can get into US REIT, with higher yield, but you'll be subject to US tax ( 15% ) + your local one. You can also simply buy the other 20% later on when you have more money. Carroll ISD, this can be South Lake or Grapevine. Even less likely when you consider that you generally don't have to worry about needing to suddenly throw more cash into a 1. That said, as many others have stated, you have the ability to sell your owned property later and therefore either recoup some costs or make a profit, depending on how the market turned and how you've kept the property. Let’s assume that his principal of 70 has This is a useless rule because it completely ignores the interest rate of the mortgage. 13. So the chances of having negative equity in a leveraged position and not being able to pay it off is less likely to happen with real estate. you can’t just buy a bunch of houses on a primary residence based loan. As an agent and investor I use the MLS almost exclusively for myself and investor clients, as you get a lot more info such as rent roll and financials. TOTAL: 20 lakhs. 5% yearly). The clock is ticking. Buying an investment property at a 7. When you buy a property (say a single family house), all of your cash flow will depends on that 1 house and that 1 tenant making that 1 payment monthly. On a MFH, they look at the realistic rent of the 3 lowest renting properties and use 75% of it to count as income. I'd also like to read opinions on whether this would be a smart way to get started in real estate. In fact, for a young professional it can be considered a positive thing to not have to worry about lawn care (as an example). If you're to buy a rental property, you should do it now before mortgage rates go up even higher. Consider Both – Rentals vs. Real estate is a leveraged investment. Re-capitalize in less the 60 months, and redeploy. 1. Here is a relatively new platform, but it has been gaining popularity in recent months. Unpopular opinion: Real Estate is a terrible investment. Also, Networking Is Key. There are 2 ways to invest : 1) buy and hold which produces income or 2) flipping which if done right can grow your investment quickly . 5 new properties added. The must reads IMO are: Larry Loftis - Investing in Duplexes, Triplexes and Quads. You could also look at it this way. Real estate is location, so it is very different investment depending on demand and purpose. In a nutshell: A civil, well-moderated discussion hub for a wide range of real estate investing topics, including news, trends, rants, tips, and more. im_vitas. Build a network of lenders, insurance brokers, contractors, that can give you different viewpoints and estimates. Now, in the initial years, his EMI is majorly cutting the interest and not the principal amount. Yes I have a full time job. I could go on and one, but you need to dig a little deeper into each of those areas as all have their good points and bad points. For example, I met a couple of other investors and we ended up coming up with a plan whereby we would buy five houses on the same block and really try to clean up the street. You're better off with finding a SFH less than new builds per sqft. If you have at least a starting point then find a lawyer to draft the docs. Duplexes are difficult to come by in Houston. 25% interest rate really sky rockets our mortgage payment Mortgage Amortization. 500k goes up 10% and you made 50% on your initial investment. Clay county is a nice area with better schools and more affordable houses, it's just not 20 minutes from downtown. Even if the loan isn't a non-recourse loan, the floor on real estate prices is historically a lot higher than it is for stocks. You Can’t Strike Gold Quickly. David Lindahl's book Multi-Family Millions. Now, opposite scenario. It's not about whether you like the house or not, it's all about ROI. Real estate: Pros: better upside. 5 million followers, it trumps even the more general r/RealEstate Reply. 2 single family homes and 1 condo. One variable, like most real estate, is the area. I have young people who are under 25 who can qualify for over $1,000,000 in investment real estate. Follow the Business Minded Approach. It's a variable mortgage, so the mortgage is entirely interest and no principal. Receive at least 75% of gross income from real estate, such as real property rents, interest on mortgages financing the real property or A REIT or real estate investment trust is a company that owns and sometimes operates income-producing real estate. ago. No, it is never a good idea. Yes, Here is a platform that allows investors to buy fractional shares of vacation rental properties. Members: 1. Hi, welcome to r/investing. You've come to the right place! /r/realestateinvesting is focused on sharing thoughts, experiences, advice and encouraging questions regardless of your real estate investing niche! Structured Deals, Flipping/Rehabbing, Wholesaling, Lending, Land, Commercial Real Estate and more! If it has to do with real estate investing this sub is for you! The estimated cost of buying land in Mexico City, demolishing and constructing a new building with about 6 apartments would run me about 1 million pesos which is 50k USD. It breaks down various components such as cashflow, principal paydown, home and renovation appreciation, initial equity, and potential tax savings, showing their individual Buy your home, take a HELOC at a low percent then invest that money making an average ROI of 7-8 or even 11% year over year (based on average) Basically. - Ability to have a higher return if you buy at the right price. Though the both have a clearly different cashflow rate, most commercial are down. 5m. With regards to that it does seem a little odd that so many people are into real estate investing. There are a lot of variables. As the boomers down size, properties will become avalible. I would 100% invest in a syndication over a REIT. Some REITs invest in a variety of real estate properties, such as offices, warehouses, and retail, while some specialize in just one type of property. Maybe instead of buying 100 shares of VTI, they only buy 80 because the price is higher. . I don't think you can say that Condos are, or are not a good investment. Turnkey off-market properties are sometimes the best deals since you don't have to put a dollar in to fix them up. REIT dividends are ordinary income. There is risk, but that is the attraction to RE. In a rural area with mostly houses with larger yards, condos likely will be valued less. I would pay the monthly bill out of pocket the first year and have the property pay I purchased my first primary residence in 09 but didn't start thinking of real estate investing until 2020. I’ve been hearing a lot of real estate investment experts claiming “it’s difficult to find a deal that makes sense in todays market”. Thank you! Check out Loopnet! It’s specifically for investment properties, tho not all of them make it on there. For example, dealflow, mentorship, and the ability to ask questions. Unfortunately, there's nothing really like property, which is: (1) a store of value; (2) easily priced; (3) easily liquidated (banks are eager to lend money to people who want to buy it from you); (4) always in demand; and (5) which can generate cash flow (be rented out) while increasing in value. They think they're being benevolent by doing this. Florida Market is insane!! Homeseller. All real estate is local. With stock investing I can spend a few minutes a month looking at stock prices and entering a buy or sell order in my brokerage account and earn 8% annually on average. Under this scenario, on a SFH, they will not count rent and just look at your income. Here are a few options to consider: Invest in a real estate crowdfunding platform: Many real estate crowdfunding platforms allow you to invest as little as $500 in a variety of real I would like to ask Redditors on this subreddit how they started investing in real estate here in the Philippines. With inflation averaging 7% over past 40 years money is bound to flow into real estate as it is a safe heaven. Usually they appraise pretty well if comps are strong. Check out the Single Family Residential Fund's April Performance below. The people who think landlords are immoral agree with you, and the people who think RE is a good investment don't want the competition. And with real estate, a huge portion your money is concentrated in one place. Read lots of real estate article and publications. A little harder to opt out of the housing market. Cons: illiquid. R/realestateinvesting is Reddit’s largest real estate subreddit by far. Lack of alternative investment opportunities as stock market is not matured enough as well as too risky for most people where as bond market is not accessible to retail investors. Smaller/Mid-sized markets are actually more stable than large markets due to the overvaluations. Not before 2100. Unlike stocks . Real estate is best protection against inflation. Stay out of Cincinnati 🤝. If you really want a course his three-day RE Mentor bootcamp is pretty good for only $1,500. So if you have one unit, can refinance after X years to pull out that capital, then you have money to spend on the next unit. Before buying the home, this gives a closely accurate payment schedule for the period of the loan. Start small, get investors, do some deals, if things work well, repeat and scale. Prices seem really low, was looking on Zillow and condos that sold for over 500k in 2012 are now listed at 200k. 8. 100K will get you a 500k investment. I also have about $500K on the sidelines, waiting for multifamily in my area to drop further as interest rates continue to rise. Not because of the money that can be made, but because as an investor you have Property Management is the answer. And that's all before interest, which you have to pay either way. One day your friendly politician might show up and tell you you can't collect rent on your property. Every condo purchase ever has been a bad idea. inflation 'on average' is 3%. Rental Returns – The rental return for owning a commercial property is generally better than residential properties and is easier to achieve a First off the beginners perks to Investing In Real Estate are pretty straightforward but nonetheless professional guidiance is necessary along the way. It sold after ONE day on the market for $840,000 no inspections taking the house AS IS. If you want to get exposure to real estate, you should probably buy actual real estate. REITS are relatively correlated with the stock market and already included in total market index funds. I did cost benefit analysis for buying a 2BHK home on 15 year loan and putting its rental of 25k pm to index fund as monthly SIP. Apr 11, 2024 · Invest at least 75% of total assets in real estate or cash. The current rent-to-own ratio is 30 in San Francisco. Any degree that pays well. As a reminder, investments made by April 30th (today) will qualify for the next expected dividend, around June 25th. But i feel like people have anecdotes about much more significant gains. 5% interest rate. passive income. The rents were $690, $730, and $1000 respectively or $2420 total. whatever percentage you put into it is the percentage you get out of it with no liability or maintenance on your end. The main advice I can give you: shopping for investment property is completely different from buying a home. $150k base + 7% bonus + $25k equity Real estate is definitely a team sport and it’s helpful to have several investor contacts. It's about Sam Zell's career and life. more control: you actually operate the real estate, not the stock. Borrowing $300,000 at 3% is different from borrowing $300,000 at 7. Started putting money away in a stock account. It seems like the internet is bolstered with positive reviews, but one can never really tell if they are trustworthy. 2) Please understand the rules and guidelines for commenting. 3. I estimated about $300/month in maintenance and $200 in utilities for additional expenses. much higher start up capital needed. I've never bought any type of real estate before, and the idea 10 votes, 20 comments. I believe real estate isn’t a great investment for most people. We have an affordable housing crisis already as it is…. Found out baby was on the way and felt like I needed to make more money someone to be able to better support him and my own financial goals. When it collapses and people flee, the demonrats there will tax the only thing left…real estate. 6 new leases secured. With the SP500, it is spread across 500 American companies with a diverse range of industries. Also IL bleeding ppl left and right. A nice way to get into real estate might be via REIT, we have some ETF Ucits friendly by BlackRock/Ishares, you collect a steady dividend each quarter without any hassle. Plus their forum is awesome. Very hard to to find a SFH for Carroll ISD right now but the property value and rent will stay elevated in this ISD. Through no fault of your own, your cash flow +$200 had turned into negative $1500 with the stroke of a pen. Naples is insane !! Happy but wow. That means that to rent an $800,000 house, you're looking at ~$27,000 in the current year (increasing by 3. Manhattan is not the same as Mongolia. 5% vs Laser45 • 7 yr. Saved up about 35k over 2 years. I now have three properties. Please stay out of our cities. My wife and I are looking to invest in our first property in Houston. REI is typically a boring investment, that has bigger payoffs as long as you stay the course. Real estate will always have value. With that being said. Share Add a Comment. Beware, check out Michigan instead. The amount of equity you can pull out You'll be competing with every real estate seminar graduate for the scrap deals of the real estate industry. Generally: You should buy an investment property with an LLC. This is going to sound nuts but accounting maybe the best degree for real estate investing. You've come to the right place! /r/realestateinvesting is focused on sharing thoughts, experiences, advice and encouraging questions regardless of your real estate investing niche! Structured Deals, Flipping/Rehabbing, Wholesaling, Lending, Land, Commercial Real Estate and more! If it has to do with real estate investing this sub is for you! 10 Tips for First Time Property Investors in NYC: Research the Market. I highly recommend the weekend training course by Right Path real estate in Katy. There are two scenarios: Owner occupied. That way, the RE company deals with most of the burden that tags along due to the pandemic. The equity will grow based on the assets you have under management (therefore scalable using the Stack theory). So online courses are often too general. Yes, any investment property whether under your own name or a LLC name will have worse terms than a property that you plan to occupy . 2. Plus, in today's markets, 3cr will fetch you a good 2-3 BHK Flat in a swanky locality if you're lucky. Look for a Reliable Partner. Also, there is a lot less diversification in real estate than there is in stocks. "The Real Book of Real Estate Investing" compiled by Robert Kiyozaki is also useful but it is very long - has chapters by different investors. Yes, there are several small ways to get started in real estate investing, even if you don't have a lot of money or experience. Risks on all sides, but investment accounts are much more liquid and taking a bit you can lower your entry by buying more stock if it dips. 3 million. Most actual real estate is not an investment. It just doesn't sound like you want to do it, which would make it a bad idea and bad investment for you. After finance fees, taxes, insurance and maintenance I think there are simply too many expenses for the average person to come out ahead or at least make any solid money. The mortgage payment on $300,000 at 3% is $1265/month. In light of the pandemic, I'd advise Residential and not commercial. We just sold my moms house that she bought 9 years ago for $346,000. A Real Estate Investment Company, focused on Fix/Flips, and a Broker company, where we lend money to investors. Also, I was browsing CrowdStreet and their IRRs and equity multiples seem really high on some of the properties (some as high as 28% IRR, or EMs of 3x or greater) for relatively low investment periods (3-5 years). There's a multitude of advantages, but one no one is discussing is taxes. Everybody should read Rich Dad Poor Dad. That would leave me about cashflow positive of about $420 a month. The way you learn about home maintenance is by doing it. Where I live, I’d be lucky to get a 10% year over year return on a rental— Without resorting to Airbnb or something similar. ht qx zn nh jo rm tm xs hy mp