patrick.net

gabbar says

How does one learn how to use debt? I will admit that I stayed away from debt because of cultural tradition.

Consumer debt is what to avoid. Business debt to buy assets like a business or rentals where the generated income can pay of the debt and generate income is prudent.

gabbar says

WookieMan says

It's okay for big companies to fail financially but you can't as a person? You are a business and it's the same thing.

Each person should act just like businesses do. If its okay for companies to default on debt, why is it not okay for individuals to default on debt (specially in non recourse states)?

Up until sometime in the late 90s, you could still write off student loans in bankruptcy. I wish I had known at the time. Also, if the IRS hasn't caught your back taxes (after 7 years I think), they can't collect. I'm not sure if that's still true though.

WookieMan says

I can promise this. Without inheritance, you will NOT be wealthy without debt.

Not true.

Debt helps you gain wealth in real estate (or net worth).
However, you can get almost wealthy just buying stock mutual funds.
$20/day can easily become a million bucks but it takes decades; most people lack patience.
A side job can easily raise the $600/month to $1000/month for investment.
Of course most people should inherit something from their parents.
My richest classmates inherited businesses from their parents.
But, they went home after college and never left.
I consider this a negative aspect of their good fortune.

Bitcoiner says

Nuttboxer, since you don’t like loans and banks…..wouldn’t you need a million in cash first to buy the land, equipment, etc to be self-sufficient? Or are you thinking of renting the land and the equipment?

Why are you being sarcastic Logan? Don't like me poking holes in your religion?

You don't need much land, depending on how many people will live on it. At least five acres I'd say, and a good water source. Obviously out in the country, and that can be had for way under a hundred thousand, even at the top of the market. Seeds are ridiculously cheap, and doesn't cost much to start with some chickens and a goat. Add some solar, propane, get a trailer for for free and dump it out there. Composting toilet, minimalist lifestyle that requires little electricity or water. Wood burning stove, or coal. Selling your extra crop, eggs, milk. Trading labor, gold, silver.

You can always find excuses to stay enslaved. Being free, that takes work.

NuttBoxer says

Why are you being sarcastic Logan? Don't like me poking holes in your religion?

Not Logan. Logan had awful grammar. Just typed and went with it. I did mostly agree with him. But Bitcoiner is not Logan. There'd be no point on a random forum. Not that I care, but Logan has(had) an ego, he wants to be known for being Logan.

I also agree with you that you should have land or at minimum move to a rural town. Community does matter. Where I'm at we have pigs, cows, corn, soybeans, wheat, etc. in abundance. Guns too. I will never mention my town, but good luck fucking with us is all I'll say. Have water and can feed ourselves forever. Chicago, San Fransisco, NYC, etc. doesn't have what I have. I don't need 80 restaurants to choose from. Give me 2 solid ones, hell even average. I like cooking so I don't go out much anyway.

clambo says

Of course most people should inherit something from their parents.

No. If you think "most people" inherent meaningful money from parents you may be living in a bubble.

NuttBoxer says

At least five acres I'd say, and a good water source. Obviously out in the country, and that can be had for way under a hundred thousand, even at the top of the market.

Actually, for a lot less than that (pun not intended):



Lots big enough for a trailer and a garden located near a small town can be had for less than $10k. This can be afforded by one who works at the local Dollar Store.

Prices of New Houses Drop Further, Builders Stimulate Sales with Price Cuts, Pulling Demand from Previously Owned Homes
by Wolf Richter • May 23, 2023 • 96 Comments

That arbitrage is now happening among homebuyers. But regular homeowners wanting to sell haven’t figured it out yet.

Homebuilders, unlike homeowners that want to sell a house, are not emotionally attached to prices. Their business is to build homes and sell them, no matter what interest rates are doing, and they cannot sit there and wait, praying, “and this too shall pass.”

So, unlike many homeowners that are thinking about selling, homebuilders started cutting prices in the fall of 2022, and they used mortgage-rate buydowns and other incentives to stimulate demand for their unsold inventory that had been piling up. And it worked. Cutting prices enough always works.

The median price of new single-family houses sold in April fell to $420,800, down by 8.2% from a year ago, and down by 15% from the peak in October, according to data from the Census Bureau today. This does not include the mortgage-rate buydowns. A different measure, the average price of new single-family houses dropped by 11% year-over-year to $501,000.

https://wolfstreet.com/2023/05/23/prices-of-new-houses-drop-further-as-builders-stimulate-sales-with-price-cuts-incentives-pulling-demand-from-previously-owned-homes/

Yep, seeing this in Florida. The stubborn Homeloaners with their 1979 3 bed, 2 bath, carport on 0.20 Acres with the 30 year old roof and Whacka-wah-wah wood panelling and raggedy treeless backyard with a cracked unshaded open concrete slab patio think they're going to get $420k when the Horton brand new 4 bed, 2.5 bath on 0.15 Acres with a garage, brand new roof, HVAC, all new appliances, screened in patio, USB ports in the walls and three times the electric outlets with all new flooring is going for $380k

HeadSet says

Lots big enough for a trailer and a garden located near a small town can be had for less than $10k. This can be afforded by one who works at the local Dollar Store.

As somebody who likes land, two things: Zoning Rules (no RVs, no Mobiles, must be 1000+ sq ft? Where is power lines? Rules for Sewer installation? Water?) and Enviro Rules ("30% wetlands must be mitigated")

Whacka wah wah wood panelling is when you walk into a room and instantly hear the background music:

https://www.youtube.com/watch?v=BAH0eqtDyMM

https://www.youtube.com/watch?v=uX8qTrwquVY

AmericanKulak says

As somebody who likes land, two things: Zoning Rules (no RVs, no Mobiles, must be 1000+ sq ft? Where is power lines? Rules for Sewer installation?

Rural areas like that are not zoned or if zoned residential, do not prohibit mobile homes. Power is available at the street in front and instead of sewer and city water, they use septic system and well. The land you like must be all in cities and developed suburbs.

Here are two with city water and sewer:

HeadSet says

AmericanKulak says

As somebody who likes land, two things: Zoning Rules (no RVs, no Mobiles, must be 1000+ sq ft? Where is power lines? Rules for Sewer installation?

Rural areas like that are not zoned or if zoned residential, do not prohibit mobile homes. Power is available at the street in front and instead of sewer and city water, they use septic system and well. The land you like must be all in cities and developed suburbs.

Here are two with city water and sewer:

That's a great find there.

No, the land I'm looking at is rural and unincorporated.

However, until I knew the Zoning and other Codes explicitly ("General", "Residential Agricultural", "Agricultural"), I would not buy that land. I've seen RA with "No RVs, No Mobile Homes, must be 1000+ sq ft, no camping short or long term." Lots of those in Volusia and St. Johns (although several do allow camping less than 30 days).

I can't imagine Virginia being easier than Florida for the most part, in most places.

Not being a pill or reflexively naysaying, just advising full caution and thorough research.

Eman says

There’s a difference between speculators and investors.

Not for the Soviets. Before 1991 if you're not shoveling government-owned shit with your two hands or sitting all day in the government-owned office - you're speculator and a criminal. That was a truly bizzarre civilization full of weirdest ideas but some of them somehow are surfacing now in the US of A.

AmericanKulak says

That's a great find there.

Actually, pretty typical. You may find this "Red Neck Riviera" interesting:



South Central Virginia has two very huge lakes. The above lot is in a waterfront neighborhood on Lake Gaston. These neighborhoods typically have a few waterfront parcels and the inland parcels have a deeded boat slip on a shared peer. One neighborhood I looked at on Kerr Lake has a golf course as well as a waterfront common with playground and clubhouse. The lot prices for the non-waterfront lots fell from $20k to around $5-6K. The lots here allow trailers but use wells and septic. I just need to find out why the lots fell in price.

Bitcoiner says

Are you including grading the land, amending and fertilizing the soil

Not gonna quote more than this, already shows your lack of knowledge about the subject. I don't think too many self-sufficient people consider themselves farmers, agorists is probably a more accurate term. You don't know about watering using clay pots, tapping into ground water, growing crops native to the area, not tilling up the ground and destroying the topsoil. Building things up little by little. Apparently you only make changes all at once, which means you never change, as that's impractical for most.

Logan's pretended to be other people before, and you're account just went active in the last month... Just say who you really are, or admit you've been caught by me again.

If I wasn't married and having to consider my wife, that would be my life by now, would've left civilization at least eight years ago. And it will be me someday, because we won't have another choice. But for me will be a welcome change.

NuttBoxer says

Logan's pretended to be other people before, and you're account just went active in the last month... Just say who you really are, or admit you've been caught by me again.

It's not Logan dude. 100%. You can't change writing styles that dramatically. Bitcoiner used to be bitcoin. I probably burned 200 comments on his threads. Also wasn't Logan in LA or further north?

@Patrick - this is why you shouldn't allow username changes. All it does is muddy the waters. I'll never change mine or ask you to delete my account. I don't get why people need to do it besides they had a bad take or argument and can't own up to it.

HeadSet says

AmericanKulak says

That's a great find there.

Actually, pretty typical. You may find this "Red Neck Riviera" interesting:

Unimproved land in flyover country is cheap. Kind of surprised in VA it being that low, though I haven't been since I was a kid. There's some nice spots in my opinion getting further away from DC.

If you can fit in, rural redneck country is where you're going to want to be in the next 2 decades or the rest of your life for the demo here. Cities are dying. Have been for a while and the pace is gonna pick up even faster. It won't be Detroit level, but more like Chicago.

Bitcoiner says

Wookie,

“ Cities are dying”
I’d hate living in the city, I live outside of SD (feels rural). I drive to SD quite frequently - mainly for padres games at Petco park or meeting friends.
It’s freakin busy in SD. Anytime you go there. I’d love to see less traffic and RE prices to come down. I don’t see that town dying. Even worse with LA. I try to avoid LA like cancer, traffic is horrible.
SF, lots of commercial RE vacancies. But people who moved away because they could work remotely are now slowly moving back because companies changed the policy and want people back in the office for a few days a week. I don’t think rents have come down significantly in SD, LA and SF. So while some cities are dying, it doesn’t seem like the west coast cities near the ocean are. When you come soon you probably see what I mean.

Can't speak for SD and LA much, but SD is certainly busy. SF however is not coming back, not even by a mile. On a positive note it may restore the city to a calmer, slower pace, with less gridlock and traffic, once they can clean it up, and make it more livable again. It has a a lot of natural beauty and greens, parks etc, doesn't have to be a "tech" or financial city, that ship has sailed long ago anyways. Downtown SF is completely gone and will not come back with the current rents and problems, taxes, the leftoid marxist retards have completed destroyed any business incentives. They should turn it into a nice residential neighborhood by the bay as offices will stay vacant. It's much more romantic without tech and biz anyways. The hard SF party times were good, but they ain't coming back, and overall I preferred the foggy mornings in scarcely populated coffee shops without hipsters, hobos and thugs and trannies. They should also tear down that stupid baseball stadium, maybe make it another aquatic center or a nice huge park, or a practice rooms for musicians, bands etc. Revive bay area thrash lol

@Bitcoiner

What's your "math" for deciding if a property is a good investment? I assume you have different math for flips vs rentals.

I'm good with SD. There's the advantage of the Mexico border to the south, the Pacific and mountains/less hospitable terrain to the East. North is already developed till LA. I see SD as a stable place to be as far as CA goes. Outside of business we'll visit my dad's cousins out there. She has a place in Carlsbad. Another has a place outside LA (not sure area) but he will come south to meet up in the middle.

I like SOCAL. LA to SF ehh. We did 1 the whole way down the state and started in Portland, OR as a kid and ended in LA. I like Northern CA. You can't beat redwoods. Besides the redwoods, SOCAL is the best part of the state in my opinion. Beach, mountains, unique terrain (Joshua Tree), Palm Springs (golf and MCM architecture), desert, ski/snowboard 2 hours away(ish) from what I recall, minimal for CA shit and needles on the street.

I have zero intention of going to LA or SF in my life again unless the kids really want to go or it's to get a rental car and go somewhere else in CA. Same with Chicago and I'm 60 miles from State and Madison (geographical counterpoint of Chicago).

I've only been twice. LA just doesn't feel like a city. It's urban sprawl. If Chicago did it the same way LA did as far as population it would be the 2nd largest city by a long shot, even losing population. We have the Chicagoland metro area which is like 11M people. I believe it's smaller than LA land mass wise. We just have it broken down into large suburbs that LA counts as LA. It's not a top 3 city population wise, they just expanded the boundaries. Call the state of Texas a city and it would be one of the largest in the world. That's what LA has set up.

Bitcoiner says

Maybe I can find some of those old discussions between the two in an old thread. I am getting a bit curious.

Logan has the record for ignores. Because of that he's changed his account, and opened dup accounts. You are doing the same thing. Created a new account to try and pretend to be someone else, because apparently your old account has so many bias's associated with it, it's become unusable.

Real world and history have blown away your biased sources numerous times in this thread, but you keep doubling down like 2008 never happened. You can manipulate stats to support any viewpoint, source is everything when it comes to stats, something you ignore. Real world, not so easy to lie about...

NuttBoxer says

Logan has the record for ignores.

That was likely Iwog and his alt accounts putting him on ignore. This is the problem with predictions. Own up to them if you're wrong. Iwog didn't and ran away. I might eat shit on the Bud Light prediction that it will eventually rebound during the summer. So what? I'll be here. I've lost coin flips and didn't go running to mommy or daddy.

Logan isn't posting on this site anymore. He never changed username or account as far as I can tell and I'm no here 300 days a year at least. He's also a mortgage broker. Of course he's going to give you shit as a renter. He can't make money off you. And that fine. He has intelligent things to say about the market in owning. Renting works for you and you've made valid points.

You sometimes seem offended to be called a renter, yet brag about renting and trash homeowners/debtors. You can slice a pizza into squares or triangles. Guess what, it's still pizza or a roof over your head. It's all about situation and not about how you get into a home. I prefer buying, but I don't look down on renters. I get a hint of jealousy from renters though. I've lost friends over our success as a family. Jealousy is a bitch. If you like renting that's you. Maybe some owners are in over their heads and are jealous of your situation.

Life is jealousy I'm learning. The key is not focusing on what other people are doing or saying. Do what's best for you and your family. Which I think you probably are not knowing you. It's ripped apart my entire wife's side of the family. I'll brag here to an extent, but I'm humble in person unless you piss me off. I like having a housing thread active again. If you want to rent you can learn from the owners and owners can learn from the renters mindset. I think that's good. It's not an argument really. Neither is better unless you make a dumb ass decision.

WookieMan says

Cities are dying. Have been for a while

They are less dying than being strangled by Tavistock Fabian aristocrats in Britain destroying the country by wedging Zimbabwe farm Kommie pidgins without frontal lobes but with enormous corruption appetites into the golden geese and strangling them. In like Detroit. Detroit was the first city successfully destroyed by the Tavistock aliens. Nobody learned from the lesson.

https://www.cbsnews.com/news/homebuying-spring-gallup-poll-housing-market/

More Americans than ever are repelled by rising home prices

A recent Gallup poll of about 1,000 U.S. adults found that just 21% of respondents believe now is a good time to buy a house. That's the fewest ever since Gallup started taking the poll in 1978.

Bitcoiner says

Wookie,

“ I've lost friends over our success as a family. Jealousy is a bitch.”

This!
Same here. It’s sad. I have also lost friends and even family members due to their jealousy. Jealousy is a huge driving force. It makes people do unimaginable things. Jealousy can reveal a few evil traits in people that you wouldn’t have known/seen otherwise.

Are you sure you're not making assumptions? Did they tell you it's because of jealousy?

GNL says

Are you sure you're not making assumptions? Did they tell you it's because of jealousy?

Yes, for example, I know a girl who busts her butt to make $1,000 per week. Then finds out her brother gets disability from SS and VA that combines to over $1,000 per week tax free despite being able to work just fine. The resentment is not really jealousy, but a sense of unfairness.

HeadSet says

GNL says

Are you sure you're not making assumptions? Did they tell you it's because of jealousy?

Yes, for example, I know a girl who busts her butt to make $1,000 per week. Then finds out her brother gets disability from SS and VA that combines to over $1,000 per week tax free despite being able to work just fine. The resentment is not really jealousy, but a sense of unfairness.

How could anyone not have a sense of unfairness to that?

GNL says

How could anyone not have a sense of unfairness to that?

How about this - a girl from a working-class family in her early 20s is working a full-time job and going to college. She has to both pay and find time to do the homework and study. In her classes are girls who are single mothers who do not work and have the college costs covered by welfare. Even daycare is provided.

HeadSet says

GNL says

How could anyone not have a sense of unfairness to that?

How about this - a girl from a working-class family in her early 20s is working a full-time job and going to college. She has to both pay and find time to do the homework and study. In her classes are girls who are single mothers who do not work and have the college costs covered by welfare. Even daycare is provided.

What is a Sense of rage, Alex? Cannot let it derail you though. BUT, surely unfair to the core.

How about this, for Eman and Bitcoiner...a ghetto rat gets first dibs on a sweet real estate deal with taxpayer money. AND, if the investment turns sour, the taxpayer bails them out. This, in turn, requires the city to increase taxes on real estate investors.

Bitcoiner says

Yes, 100% sure it’s not an assumption. Their change in behavior is tied to specific events like us buying a new car, going on a nice vacation or buying houses. And, no, a jealous person would never admit this to you. Lol.
You must have not experienced this before.

When I tell specific fiends or family that we bought a house or a rental, those that are wealthy are the ones that congratulate you and seem happy for you. Many of those that dont own anything are the ones that can’t be happy for you. (some text omitted to shorten quote...) cess story and they look miserable and shortly after you feel the backlash (evil things like not inviting you anymore to family events, trying to exclude you, gossiping about you, trying to always get into arguments or trying to provoke you, making up false stories about you etc).

We were very poor when we got married. Now we are doing well. Some people in your inner circle are left behind and struggle financially. Often the jealousy is very apparent between siblings or people you grew up with.

It is an assumption because you do not KNOW. Some people become quite arrogant when they achieve success. I would not doubt you many be one of them since you spend so much time here boasting about how successful you are. Why are you doing that? No friends to spend time with?

GNL says

Bitcoiner

What's your "math" for deciding if a property is a good investment? I assume you have different math for flips vs rentals.

@GNL,

For flips, I’d prefer 50% to max 60% ARV (after repaired value) when I buy.

For buy-and-pray, I don’t mind paying 3 to 4 cap rate although the market is trading at 5. If I can achieve 7 to 8 cap (stabilized) in 5-7 years, it’s a go. On great properties, I’d take 6 cap after stabilized because I know I can sell it for 4 cap.

GNL says

How about this, for Eman and Bitcoiner...a ghetto rat gets first dibs on a sweet real estate deal with taxpayer money. AND, if the investment turns sour, the taxpayer bails them out. This, in turn, requires the city to increase taxes on real estate investors.

Only the city of Berkeley and SF lunatic politicians would think of this stuff IMO. No one in their right mind would.

Bitcoiner says

You should ask EMAN this, he’s the pro.
I haven’t done flips.

My rentals: that’s pretty straightforward. There’s a lot of fancy metrics you may apply but bottom line for me is:

I focus on detached SFH. Decent to good area. If it’s not an established known good area then it needs to have up and coming potential. PITI + safety cushion + hoa + property manager needs to be covered by rent with a 25% downpayment. It’s a long term play for me. I don’t mind (some text omitted to shorten quote...) nd your equity in the house and your rental income increases yearly. I asked a realtor friend who also owns the PM company to show me how his clients are doing. Most investors he works with put down significantly more than 25%. Instead of buying two rentals and stretching yourself you could just buy one and be on the conservative side. Slow and steady wins the race is my philosophy in real estate. Always have cash on the sidelines for a rainy day. Time and inflation is on your side.

Buying SFH with 25% down at break even or slightly negative cash flow was preached by the veterans in the Bay Area and SoCal. Rent and asset value increase with time. Time will do all the heavy lifting. When you’re retired, you’d have $1M in equity on each property.

I cashed out my IRA, paid the taxes and penalty, and used the money to buy real estate between 2009-2012. 😬

GNL says

It is an assumption because you do not KNOW. Some people become quite arrogant when they achieve success. I would not doubt you many be one of them since you spend so much time here boasting about how successful you are. Why are you doing that? No friends to spend time with?

Success is relative. My biz partner is worth $24M, and he thinks he’s middle class. He made his millions by selling his startup company at the age of 30. He’s 53 now.

My neighbor household income is well north of $500k/year. They own 20 rentals and they think they’re middle class. It’s like WTF?

Share knowledge and pay it forward is how we do it in real estate. The most amazing thing I’ve witnessed is that real estate billionaires are some of the nicest people I’ve ever met. The assholes are the ones who think they’re rich.

Eman says

I cashed out my IRA, paid the taxes and penalty, and used the money to buy real estate between 2009-2012. 😬

Have been thinking about this so often, I was able to get a 3 year 0% covid loan which was great, but really the idea of having to keep the money in by force or threat of penalty doesn't sit well with me, a free society shouldn't need this crap. It's just for people who can't manage their money, but in the end it makes everyone poorer. I'd abolish any such 401k "plans" that have penalties and restriction, everything should work like a roth at the minimum and be acessible.

Just got this in my inbox. Existing 5.7 cap with 7% stabilized. It’s not in my farm so I don’t bother to look into it.

Eman says

I cashed out my IRA, paid the taxes and penalty, and used the money to buy real estate between 2009-2012. 😬

Tread lightly with this advice. Government, banks, etc. can't touch those assets. I wouldn't liquidate them ever unless you needed that cash to live. Risky move. Glad it worked out, but I wouldn't put this out as advice to get into RE. Which I understand the emoji. It was a stupid move and you lucked out and you know it. Keep assets protected and you can do what you want.

WookieMan says

Eman says

I cashed out my IRA, paid the taxes and penalty, and used the money to buy real estate between 2009-2012. 😬

Tread lightly with this advice. Government, banks, etc. can't touch those assets. I wouldn't liquidate them ever unless you needed that cash to live. Risky move. Glad it worked out, but I wouldn't put this out as advice to get into RE. Which I understand the emoji. It was a stupid move and you lucked out and you know it. Keep assets protected and you can do what you want.

Not advice. I made a bet, and it worked out for me. I encountered a few individuals on BiggerPockets who did the same move. None regretted it. In fact, they all were happy they did it.

You and I likely don’t agree on this, but I’ve viewed IRA as live less now so we can live less later. I’d rather live more now so I can live more later. Put enough money in 401k to get the max company match and not a penny more. Other than that, I don’t give a damn about retirement account/plan. I think it was designed so money manager can charge fees for doing nothing. It’s like a lifetime annuity for them.

We don’t have a 529 plan for our daughter. I’d rather put that money in real estate, use the cash flow to pay for her college tuition. Once she’s done with college, we still have the cash flow for decades to come.

Eman says

Just got this in my inbox. Existing 5.7 cap with 7% stabilized. It’s not in my farm so I don’t bother to look into it.

Looks like one needs an AK-47 if he wants to go collect past due rent there...

https://www.redfin.com/CA/Hayward/26485-Gading-Rd-94544/home/1752162

mell says

Eman says

I cashed out my IRA, paid the taxes and penalty, and used the money to buy real estate between 2009-2012. 😬

Have been thinking about this so often, I was able to get a 3 year 0% covid loan which was great, but really the idea of having to keep the money in by force or threat of penalty doesn't sit well with me, a free society shouldn't need this crap. It's just for people who can't manage their money, but in the end it makes everyone poorer. I'd abolish any such 401k "plans" that have penalties and restriction, everything should work like a roth at the minimum and be acessible.

Yeah.

Now that I'm retired and living off those types of accounts, it made me feel stupid. Because nearly all the growth of those was long term capital gains, and dividends, which on the federal return are taxed at a lower rate than ordinary income. But the retirement account withdrawals are taxed as ordinary income.

Makes me feel stupid.