patrick.net

@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.

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

Don't exaggerate, is not bad location. Glock 9 mm will be sufficient for surely.
5 unit is step up in expense to finance than 4 unit.

The type of person who would want to be a tenant there is not the type of person who I'd want to know I'm the landlord.

Eric Holder says

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

Not my farm so I can’t comment on its location. Just like anything in life, have to kiss a lot of frogs before I find my princess. Good deals rarely make it to the market.

One thing I’ve learned is that there are more wear and tear on lower end properties. Everything in life has a price. There’s a reason why something is cheap and not selling.

Eman says

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

Yeah, seems like a big risk...at the time. What convinced you to throw all your chips on the table at that time?

Eman says

The assholes are the ones who think they’re rich.

I have no problem with you or Bitcoiner. However, I do stand by my comment about adding to the economy. Rent seeking (no just in RE) is an extraction moreso than an addition imo.

B.A.C.A.H. says

But the retirement account withdrawals are taxed as ordinary income.

yeah, that is why i try to get my family and friends to maximize their roth ira contributions

GNL says

Eman says

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

Yeah, seems like a big risk...at the time. What convinced you to throw all your chips on the table at that time?

Historical data. I did a ton of research and was convinced it was a once in a lifetime opportunity for real estate. Everything was on 🔥 sale. I quit my W2 and plowed into real estate full-time. On deals I couldn’t close b/c I ran out of cash, which wasn’t much, I brought on partners. 50% of something is better than 100% of nothing. Or passed them to family members.

Ironically, I only saw upside and didn’t see much downside (risk) based on the numbers. Turned out, my estimated numbers were way too conservative.

My buddy bought this building in my farm 1.5 years ago. His rent roll has gone up 15%. He works for the Federal Reserve and has a pension. Rent seeking or not, he also gets a pension. Is pension also a form of rent seeking? 🤑

https://redf.in/ckKM1z

GNL says

Eman says

The assholes are the ones who think they’re rich.

I have no problem with you or Bitcoiner. However, I do stand by my comment about adding to the economy. Rent seeking (no just in RE) is an extraction moreso than an addition imo.

Real estate is a means to an end. We’re all only on this earth for a short amount of time. I want my stay here as enjoyable as possible. I want to have control of my time so I can spend it however I want. Since HS, I knew I didn’t want to work for others. Working for others is also a means to an end. This was why I didn’t last very long in my W2 career.

Rent seeking or not, this is only a start. My goal is a lot bigger, but I’m doing it at my own time. No deadline and no one tells me what to do. If/when I die and I haven’t reach my goal, it is what it is. No need to work myself to death to get there sooner. I want the journey to my destination as enjoyable as possible so I don’t mind if others disagree with the way I make my money. It’s all good. We can agree to disagree.

My other friend bought this building in our other farm. This is by San Jose Japantown. We offered the seller $2.7M in 2017, but he insisted on getting $3M for it. So I passed it to my friend, who bought it for $2.95M.

Last year, they refinanced and got 50% of their money back. Husband works for GOOG for 17 years. Wife for for FTNT. High income earners.

My partner and I own 24 units in this neighborhood. Paid $5.04M. Appraised for $7.5M last year when we refinanced.

https://www.zillow.com/homedetails/589-N-3rd-St-APT-04-San-Jose-CA-95112/2092967938_zpid/

Eric Holder says

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

Belt fed or dead! You have to outgun the locals to get street cred.

Eman says

Rent seeking or not, he also gets a pension. Is pension also a form of rent seeking?

Yes, especially when it is paid by people that never had a vote or choice in said pension. The grifting is aplenty. The government has had to cover how many pension funds? I think they even have a federal pension guarantee fund or something? Haha, did I hear uncle Sam (you and I) are paying Ukraine's pensions?

GNL says

Haha, did I hear uncle Sam (you and I) are paying Ukraine's pensions?

Nope, just you are paying. Everyone else is on their own government pension. (If you researched how many people are collecting gov pension/disability/grants you may find this joke closer to the truth than you like).

HeadSet says

GNL says

Haha, did I hear uncle Sam (you and I) are paying Ukraine's pensions?

Nope, just you are paying. Everyone else is on their own government pension. (If you researched how many people are collecting gov pension/disability/grants you may find this joke closer to the truth than you like).

You're not paying through inflation?

@Eman, I would agree with anyone who would suggest I spend too much time being unhappy about the current American system(?). I'll live my life trying to add and/or improve what I see around me. The financial system and incentives are, imo, exploitive but, I would imagine that's with any system. I pride myself in making money while improving other people's lives.

What is anyone's opinion, here, on how Soros has achieved his financial position? We are financializing everything. Carbon credits anyone? If a thing can be done, it should be done?

Just some thoughts.

Some unsolicited advice: be careful how you "think" you are helping your family. I'm sure almost everyone can attest to the horrible results $$ has had on friends and loved ones. My son in law is part of a family that owns about a billion dollars worth of real estate. My 2 grandkids already own part of the family REIT. I am quite worried how they will end up. Seriously.

GNL says

Some unsolicited advice: be careful how you "think" you are helping your family. I'm sure almost everyone can attest to the horrible results $$ has had on friends and loved ones. My son in law is part of a family that owns about a billion dollars worth of real estate. My 2 grandkids already own part of the family REIT. I am quite worried how they will end up. Seriously.

Wealth can be destroyed in a generation or less. Assets that produce cash flow can be sold by people who don't know what they are doing but just inherited the estate.

GNL says

Eman says

Rent seeking or not, he also gets a pension. Is pension also a form of rent seeking?

Haha, did I hear uncle Sam (you and I) are paying Ukraine's pensions?

No, they are being paid from the $350B in Soviet assets.