Wednesday, December 7, 2011
RE online auctions are waste of time.
[from online forum]
if you want to learn something, go to few sheriff auctions...
if you want to learn something, go to few sheriff auctions...
Rent increase? Howto
[From online forum]
we sending letters out this week... @ 2011-12-07
current lease holders no increase.
month to months, 3-5%
new leases, 5-10%
month to months, 3-5%
new leases, 5-10%
Investment RE must cash flow, cash flow and cash flow!!!
[From online RE forum]
Lately, I notice many posts begin to ask questions on "Cash Flow" vs. "Appreciation", that reminded me, these were same questions raised 3 years back, when this forum first form.
This forum was separated from Home forum in 07, RE was so hot, RE investors begin to chase ultra high appreciation. Many forum members share their stories on how to make 25-50k by just signing a construction contract, and value RE investing was put aside.
There were only few members argue that high appreciation, also translate into high risk. in 08, I wrote these.
while traditional RE is more focus at location, location and location, I think investment RE must focus on cash flow, cash flow and cash flow.
many ppl here more interest in ultra high appreciation in RE and sacrifice with negative cash flow, they need to relearn the truth of RE investing in a long term market.
RE investors need to look at how to minimize upfront cash investment, and maximize positive cash flow, providing a consistent cash income and appreciation over time, nothing beats $0 investment but with 150k cash income and 300k appreciation each year.
3 years later today, not many old forum members left, most of them came and gone, the ones the still here, are these sticking to the basics.
I know RE market is recovering in most areas, even in Indiana, my area is almost back to its all time high, but only eying on appreciation instead of true positive cash flow, can be dangerous.
I am not saying high appreciation is bad, but as an investor, market will always going up and down, one should always prepare for the worst...
Lately, I notice many posts begin to ask questions on "Cash Flow" vs. "Appreciation", that reminded me, these were same questions raised 3 years back, when this forum first form.
This forum was separated from Home forum in 07, RE was so hot, RE investors begin to chase ultra high appreciation. Many forum members share their stories on how to make 25-50k by just signing a construction contract, and value RE investing was put aside.
There were only few members argue that high appreciation, also translate into high risk. in 08, I wrote these.
| investment RE must cash flow, cash flow and cash flow |  |
many ppl here more interest in ultra high appreciation in RE and sacrifice with negative cash flow, they need to relearn the truth of RE investing in a long term market.
RE investors need to look at how to minimize upfront cash investment, and maximize positive cash flow, providing a consistent cash income and appreciation over time, nothing beats $0 investment but with 150k cash income and 300k appreciation each year.
3 years later today, not many old forum members left, most of them came and gone, the ones the still here, are these sticking to the basics.
I know RE market is recovering in most areas, even in Indiana, my area is almost back to its all time high, but only eying on appreciation instead of true positive cash flow, can be dangerous.
I am not saying high appreciation is bad, but as an investor, market will always going up and down, one should always prepare for the worst...
Tuesday, December 6, 2011
Few of the Pros and Cons of Multi Family Units
[From online]
MFU complex has its goods and bads, I usually don't recommend beginner jump in a big complex without any prior experiences, one should start with SFH in decent condition, I personally did not own any MFUs till I had over 20+ SFHs, but to reach a greater scale, eventually you have to look into commercial MFUs..
here are few of the pros and cons I can think of..
Pros
1. cash flow can be very good compare to SFH, due to lower per unit cost.
2. per door maintenance is much less since they all in one location.
3. centralized office means less traveling for you or handy man.
4. Insurance cost also cheaper compare to SFH.
5. similar floor plan, similar setup, easier to manage.
Cons.
1. Higher vacancy rate due to centralized location, aka, neighbors.
2. higher cost of leverage, shorter term loan.
3. commercial loan is harder to get, or maybe near almost impossible.
4. lower quality tenants, more younger generations.
5. owner usually has to pay basic utilities as water, sewer, and trash pickup.
MFU complex has its goods and bads, I usually don't recommend beginner jump in a big complex without any prior experiences, one should start with SFH in decent condition, I personally did not own any MFUs till I had over 20+ SFHs, but to reach a greater scale, eventually you have to look into commercial MFUs..
here are few of the pros and cons I can think of..
Pros
1. cash flow can be very good compare to SFH, due to lower per unit cost.
2. per door maintenance is much less since they all in one location.
3. centralized office means less traveling for you or handy man.
4. Insurance cost also cheaper compare to SFH.
5. similar floor plan, similar setup, easier to manage.
Cons.
1. Higher vacancy rate due to centralized location, aka, neighbors.
2. higher cost of leverage, shorter term loan.
3. commercial loan is harder to get, or maybe near almost impossible.
4. lower quality tenants, more younger generations.
5. owner usually has to pay basic utilities as water, sewer, and trash pickup.
Obama Makes It Official: 1099 Repeal Signed Into Law
http://www.kaiserhealthnews.org/daily-reports/2011/april/15/1099-repeal.aspx
Because the 1099 reporting requirement was a non-health related revenue-raising provision within the health law, its repeal is paid for with a payback provision that recoups funds from people who exceed their estimated income level during the course of the year after receiving subsidies for health insurance.
The Hill: Obama Lifts 1099 Tax Reporting Burden
President Obama on Thursday signed into law a bill repealing the health care reform law's 1099 tax reporting requirement, the first provision of the Democrats' law to get the ax. The Senate passed the law, 87-12, on April 5. The Republican controlled House cleared it in March. Obama signed the bill, which was defeated several times, despite taking issue with the ways it's paid for: a "clawback" provision that goes after people who get more in health care subsidies than entitled to under the health care reform law. "Today, I was pleased to take another step to relieve unnecessary burdens on small businesses by signing H.R. 4 into law," reads the president's signing statement (Pecquet, 4/14).
Bloomberg: Obama Signs Law Repealing Business Tax Reporting Mandate
President Barack Obama signed a bill repealing a tax-compliance mandate in last year's health care law, giving a victory to business groups that led a campaign against the requirement. The repealed provision, under which companies would have had to report more transactions to the Internal Revenue Service, was included in the law as a revenue-raising measure. It was to have taken effect in 2012 (Rubin, 4/14).
CQ HealthBeat: President Signs 1099 Repeal Into Law
President Obama on Thursday signed into law the first significant revocation of a portion of the health care law — a business tax-reporting requirement that members of both political parties disliked. Obama signed HR 4, which repeals a provision that required business and real estate owners to file a 1099 form with the IRS for every vendor to whom they paid more than $600 in a year. Business groups had lobbied hard against the provision. ... The $22 billion cost of the 1099 legislation was offset by requiring some people, if their income level increases during the year, to pay back a portion of the subsidies they receive to join health insurance exchanges created under the law (Norman, 4/14).
The Hill: Obama Lifts 1099 Tax Reporting Burden
President Obama on Thursday signed into law a bill repealing the health care reform law's 1099 tax reporting requirement, the first provision of the Democrats' law to get the ax. The Senate passed the law, 87-12, on April 5. The Republican controlled House cleared it in March. Obama signed the bill, which was defeated several times, despite taking issue with the ways it's paid for: a "clawback" provision that goes after people who get more in health care subsidies than entitled to under the health care reform law. "Today, I was pleased to take another step to relieve unnecessary burdens on small businesses by signing H.R. 4 into law," reads the president's signing statement (Pecquet, 4/14).
Bloomberg: Obama Signs Law Repealing Business Tax Reporting Mandate
President Barack Obama signed a bill repealing a tax-compliance mandate in last year's health care law, giving a victory to business groups that led a campaign against the requirement. The repealed provision, under which companies would have had to report more transactions to the Internal Revenue Service, was included in the law as a revenue-raising measure. It was to have taken effect in 2012 (Rubin, 4/14).
CQ HealthBeat: President Signs 1099 Repeal Into Law
President Obama on Thursday signed into law the first significant revocation of a portion of the health care law — a business tax-reporting requirement that members of both political parties disliked. Obama signed HR 4, which repeals a provision that required business and real estate owners to file a 1099 form with the IRS for every vendor to whom they paid more than $600 in a year. Business groups had lobbied hard against the provision. ... The $22 billion cost of the 1099 legislation was offset by requiring some people, if their income level increases during the year, to pay back a portion of the subsidies they receive to join health insurance exchanges created under the law (Norman, 4/14).
This is part of Kaiser Health News' Daily Report - a summary of health policy coverage from more than 300 news organizations. The full summary of the day's news can be found here and you can sign up for e-mail subscriptions to the Daily Report here. In addition, our staff of reporters and correspondents file original stories each day, which you can find on our home page.
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