Bought my first single family in 2019, sold it in 2020. Used funds to buy owner occupy duplex w/15% down. Saved up money to buy 2nd duplex. Held for 6 months, did cash out refi & used money to buy 3rd duplex. Saved up money and bought 4th duplex. Used heloc and bought 5th duplex. Then used 401k $ and bought 6th duplex. I now have 12 rental units all in same neighborhood. Majority of my loans are 30 yr fixed under 4% interest.
Did you sell your house in a year? Why? How much did you profit from selling your first house? I have a house bought in 2004. I don’t need to live in this house anymore. Should I sell it and invest to duplex?
@@meecheongkim3980 sell or rent it. Sell if you think you can get a better deal using the cash, rent it if you think it'd be hard to replace for the $ amount you could sell for minus closing/taxes.
I don't leave comments often but you and Brandon have helped change my life. I have been interested in REI for some time. I read a few books by Brandon and yourself and finally took the leap and purchased a property in Feb. It was exciting and nerve racking at the same time but had been so much fun with a lot of learning on the way. With your words and knowledge I recieve from the biggerpockets podasts, I feel I have the knowledge i need to be successful. I am thankful for this episode and the info on building equity. I can't wait to purchase my next property and continue to build my portfolio. Thanks for all you guys do.
I'm 58 and my husband and I are very worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, we are finding it impossible to replace it. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 40years nonstop just for a crooked system to take all you worked for in a twinkle of an eye.
That's why I started real estate investing in 2019. We saw our home value double since then. Definitely a bigger change than our 401Ks and Roth IRAs. Never to late to start this route looking into other ways to creatively finance if you don't have the assets or liquidity needed traditional lending. I personally will never retire even though we have the ability to do that without anxiety. People live longer when they stay active working on things that are a passion and give them purpose. I'll likely start a vacation rental business after I get my homeschoolers out of the house.
We are breaking even on one of our properties. Cash flow isn’t the main focus at this juncture. It is the mere fact that the property takes care of itself. We are not stressed and know that we did purchase at a superb price, provide a nice home in a good neighborhood. Our wealth is growing and our tenants are content.
Closing on my first duplex house hack this week. Blindly offered 20k above asking in a not so great area. Stupid rookie mistake but hoping to get some good deals moving forward
Thank you David for another great episode. I am new to the investment arena, and my focus is not on cash flow but building equity and aiming for long term appreciation. I am trying to capitalize on my decent W2 income to buy in good neighborhood with good quality tenants, which translates to negative cash flow in my market. Some times I feel lonely because most people think buying a negative cash flow rental is stupid. It is refreshing to hear this different approach being discussed.
Wow! I listen to as many of these as I can, but with so many investors in different situations, they don't necessarily apply to us at THIS moment. Almost all of the QAs in this episode were directly relevant to us right now. Thank you for all of your answers, and breaking each subject down for us to understand. Thank you David, and to all of you on the BiggerPockets Podcast SHOW!
Thank you so much, David! I love your podcast so much and listen to it as often as I can. And I started to listen to your book Long Distance Real Estate.
I don't like the sound of HELOCs, because of the fluctuating interest rates. Which one would make my mortgage go up the most a cash out refy or a equity loan?
Great Show. I appreciate David’s candid honesty about what sells to the masses vs what some investors choose to do lien BEAF. It was probably TMI that is not a good look for your business. Either way I still appreciate you. I just would have never said that quite part out loud. Keep up the great work. BP is my favorite Podcast!
This video talks about how to make the most money from real estate. David shares smart ideas about what to do with your property investments in the future. It's helpful for planning your money. Good job, David, for sharing your knowledge!
The only beef I have with this episode and bp in general lately is we’ve lost the art of brrrr and gone more down the road of old school traditional real estate of longer term buy and hold equity plays. Those are great in some markets and in a slow pace. The comment made about buying in great areas below market price is near impossible in my area because that’s where properties sell same day with 15 offers. Nobody in their right mind would sell off market in these areas even if the property is condemned. So unless you have your own wholesale machine behind your purchases there’s no way you are getting a or even b properties for below market value and minuscule cashflow. Brrrr is the only way to buy and be able to buy another property before 5 years 🤞🏽in the a-b markets and try to build a portfolio for a beginner who doesn’t have hundreds of thousands of dollars to invest and park for a while with no worries. I’d love to hear more about beginners using brrrr in this climate to grow where you can buy 2-4 properties in a year with mostly the same money over park 80 grand in the best neighborhood and sit and hope you can buy another property one day.
I personally have a property right now. I want to rent and considering getting a second mortgage. It would shrink my cash flow significantly and I would essentially be doubling my interest rate difficult to decide what to do. 200K mortgage with 4% rate currently and appraisal value of 390K... current rate 7.5%^
I can’t imagine using BRRR right now, where would we even find the contractors? These tradesmen are all retiring with few young people going in to the trades
I’m here to reset and jump back in. I bought my first house hack property solely based on numbers and neighborhood potential vs actual neighborhood. Fortunately, I sold in this artificially inflated market and walked away with a nice profit. Friends, location is everything!
How do you decide to sell a rental property after its appreciated for a few years or just decide to keep renting it ... keep it for cash flow ? Its a property that is minimal effort
I recently bought a house in riverside California with FHA 6.1 ….if rates pull back but values go down is there a way to still refinance??? I am trying to value add … have a duplex but just discovered the back house is not registered as a ADU but it’s registered as a rec room with bath so working on getting the proper permits to register as a ADU to add value
I look at Cash Flow as 1 of the ‘big 5’ reasons that are benefits of investing on properties. So I agree…..breaking even with a great investment is a plus not the end of the world as the other 4 great benefits carry you.FABULOUS QUESTION❤
I have a question I had LOC for 2.5m. But since interest rate went to 8.5% prime. My DSCR WENT DOWN. So they lowered my LoC to 2m. But I make enough money to pay for it on my tax return. But for some reason their only going off my property NOI.
That’s how DSCR works, off the property income and a BLOC (like a HELOC) is seen to be more risky. HELOCs were closed in the last down turn, because banks need to have cash on hand to facilitate draws. Fixed rates on DSCR can be lower than revolving funds.
You don't have to pay the capital gains tax if you sell and put your money in a DST. You will get cash flow as well. This is especially good if you don't want to be a landlord anymore ! I with tax attorneys who can set thos up for you. Let me know if you're interested .
Hey David, I am looking to do a partnership with my dad on a Lakehouse down here in Florida. Is it possible to get two separate mortgages upon purchase? He plans to pay his half off sooner. Do you know of any partnership loan products or have any advice?
Hi David, I have a three bedroom townhome with association fees for $375 and trying to sale it due to high fees . What your thoughts on my decision to sale? Grace
Jed, you have all the ingredients to be a great salesman-just shave and be clean cut. No tattoos, blue hair, or piercings. Also, don’t smoke. Always look fresh, clean, and professional. I’d get a nice polo shirt with a company logo on it. Uniform khakis. Drive a nice, clean truck with your logo on the side of it. Lastly, have a nice, easy to read business card with your company logo on it.
Guy calling in from Shanghai is talking as if China were just like the USA when it comes to private property (among many other concepts). Good luck getting your money out of China.
I’ve been finding deals on foreclosed and probate houses. It depends on one’s strategy. I also like buying with seller financing rather than bank financing.
@@alldanamesrtakn I am sorry but that is dumb to say because it is impossible to know the right numbers to win a lotto--But ENTIRELY possible to know What is a good location criteria What is a good (enough) condition criteria and What is a good price for you taking many factors like the first 2 plus your finances and the income potential of a house--which makes it NOT a total crapshoot--unless one is too lazy to do the legwork--which can be an issue a lot of folks
Bought my first single family in 2019, sold it in 2020. Used funds to buy owner occupy duplex w/15% down. Saved up money to buy 2nd duplex. Held for 6 months, did cash out refi & used money to buy 3rd duplex. Saved up money and bought 4th duplex. Used heloc and bought 5th duplex. Then used 401k $ and bought 6th duplex. I now have 12 rental units all in same neighborhood. Majority of my loans are 30 yr fixed under 4% interest.
It was a great time to start
Is it a commercial loan? Or did you do the loans as personal loans since we can have up to 10?
@@Lik3ToSingyes I had perfect timing
Did you sell your house in a year? Why? How much did you profit from selling your first house? I have a house bought in 2004. I don’t need to live in this house anymore. Should I sell it and invest to duplex?
@@meecheongkim3980 sell or rent it. Sell if you think you can get a better deal using the cash, rent it if you think it'd be hard to replace for the $ amount you could sell for minus closing/taxes.
I don't leave comments often but you and Brandon have helped change my life. I have been interested in REI for some time. I read a few books by Brandon and yourself and finally took the leap and purchased a property in Feb. It was exciting and nerve racking at the same time but had been so much fun with a lot of learning on the way. With your words and knowledge I recieve from the biggerpockets podasts, I feel I have the knowledge i need to be successful. I am thankful for this episode and the info on building equity. I can't wait to purchase my next property and continue to build my portfolio. Thanks for all you guys do.
I'm 58 and my husband and I are very worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, we are finding it impossible to replace it. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 40years nonstop just for a crooked system to take all you worked for in a twinkle of an eye.
That's why I started real estate investing in 2019. We saw our home value double since then. Definitely a bigger change than our 401Ks and Roth IRAs. Never to late to start this route looking into other ways to creatively finance if you don't have the assets or liquidity needed traditional lending. I personally will never retire even though we have the ability to do that without anxiety. People live longer when they stay active working on things that are a passion and give them purpose. I'll likely start a vacation rental business after I get my homeschoolers out of the house.
We are breaking even on one of our properties. Cash flow isn’t the main focus at this juncture. It is the mere fact that the property takes care of itself. We are not stressed and know that we did purchase at a superb price, provide a nice home in a good neighborhood. Our wealth is growing and our tenants are content.
Another GEM of “Seeing Green”! Great answers to great questions! Always learning from David and BP! Thanks so much!
Love this episode!!! Your podcasts give me motivation when I start to lose steam. Thank you.
Closing on my first duplex house hack this week. Blindly offered 20k above asking in a not so great area. Stupid rookie mistake but hoping to get some good deals moving forward
Congratulations!!! 🎉🎈🍾
Get a good realtor to help you. It’s not good to start out in the hole or near it. I’ve seen many newbies drop out after their first deal went bad.
Thank you David for another great episode. I am new to the investment arena, and my focus is not on cash flow but building equity and aiming for long term appreciation. I am trying to capitalize on my decent W2 income to buy in good neighborhood with good quality tenants, which translates to negative cash flow in my market. Some times I feel lonely because most people think buying a negative cash flow rental is stupid. It is refreshing to hear this different approach being discussed.
Wow! I listen to as many of these as I can, but with so many investors in different situations, they don't necessarily apply to us at THIS moment. Almost all of the QAs in this episode were directly relevant to us right now. Thank you for all of your answers, and breaking each subject down for us to understand. Thank you David, and to all of you on the BiggerPockets Podcast SHOW!
So many pearls of wisdom I could make a necklace. Thanks for all the amazing insight sir!
It’d great to have a show for real estate agents in this recession to survive!
Thanks you!!!
If it doesn't cashflow it's a liability and liabilities take money out if your pocket
Great episode. I love how you were able to cover everyone's different questions. Mine was asked by someone else. 🥰
Fabulous answers❤🇨🇦……thank you for clarifying the paths forward…exactly what I needed.
Thanks for being honest about the BEAF. That is the route I am going as well. Looking at long term plan.
Great response using analogies concerning various was to realize/utilize the real estate's income and/or equity.
Well explained...so many variables
Thank you so much, David! I love your podcast so much and listen to it as often as I can. And I started to listen to your book Long Distance Real Estate.
Great episode!! I really needed this one!
I don't like the sound of HELOCs, because of the fluctuating interest rates. Which one would make my mortgage go up the most a cash out refy or a equity loan?
Great Show. I appreciate David’s candid honesty about what sells to the masses vs what some investors choose to do lien BEAF. It was probably TMI that is not a good look for your business. Either way I still appreciate you. I just would have never said that quite part out loud. Keep up the great work. BP is my favorite Podcast!
This video talks about how to make the most money from real estate. David shares smart ideas about what to do with your property investments in the future. It's helpful for planning your money. Good job, David, for sharing your knowledge!
The only beef I have with this episode and bp in general lately is we’ve lost the art of brrrr and gone more down the road of old school traditional real estate of longer term buy and hold equity plays. Those are great in some markets and in a slow pace. The comment made about buying in great areas below market price is near impossible in my area because that’s where properties sell same day with 15 offers. Nobody in their right mind would sell off market in these areas even if the property is condemned. So unless you have your own wholesale machine behind your purchases there’s no way you are getting a or even b properties for below market value and minuscule cashflow. Brrrr is the only way to buy and be able to buy another property before 5 years 🤞🏽in the a-b markets and try to build a portfolio for a beginner who doesn’t have hundreds of thousands of dollars to invest and park for a while with no worries. I’d love to hear more about beginners using brrrr in this climate to grow where you can buy 2-4 properties in a year with mostly the same money over park 80 grand in the best neighborhood and sit and hope you can buy another property one day.
I personally have a property right now. I want to rent and considering getting a second mortgage. It would shrink my cash flow significantly and I would essentially be doubling my interest rate difficult to decide what to do. 200K mortgage with 4% rate currently and appraisal value of 390K... current rate 7.5%^
I can’t imagine using BRRR right now, where would we even find the contractors? These tradesmen are all retiring with few young people going in to the trades
Well thought out and clearly explained regarding sales advice.
Loved this show! Thanks David!
Great information ✍🏽
I’m here to reset and jump back in. I bought my first house hack property solely based on numbers and neighborhood potential vs actual neighborhood. Fortunately, I sold in this artificially inflated market and walked away with a nice profit. Friends, location is everything!
I am SO thankful for your podcasts, David! This is awesome as usual! 🙏🏼❤️
So much free game, love the information David going to get my 3rd property this year looking for a multi family home!
What’s your IG?
How do you decide to sell a rental property after its appreciated for a few years or just decide to keep renting it ... keep it for cash flow ? Its a property that is minimal effort
Valuable information ❤
I recently bought a house in riverside California with FHA 6.1 ….if rates pull back but values go down is there a way to still refinance??? I am trying to value add … have a duplex but just discovered the back house is not registered as a ADU but it’s registered as a rec room with bath so working on getting the proper permits to register as a ADU to add value
If rate drop in the near future and house values go down under water, you cannot refinance.
Straight wisdom.
Thank you for this show. Go Green
Gonna have to buy your new book… can you sign them if we pre order 😁
How do i use the equity in commercial/mixed use properties? Without refinancing since i if refi right now id be getting a higher rate
I look at Cash Flow as 1 of the ‘big 5’ reasons that are benefits of investing on properties. So I agree…..breaking even with a great investment is a plus not the end of the world as the other 4 great benefits carry you.FABULOUS QUESTION❤
How do u feel about acquiring properties thru subto. ? Good or rsiky
Great information 🔥
I don’t know what’s going on but houses listed in my area cut price everywhere. Some sitting on market very long.
Looking at buying my first business and doing all I can to get loan information
I have a question I had LOC for 2.5m. But since interest rate went to 8.5% prime. My DSCR WENT DOWN. So they lowered my LoC to 2m. But I make enough money to pay for it on my tax return. But for some reason their only going off my property NOI.
I need help please I’m 26 years old. Would love some older experience wise guys
That’s how DSCR works, off the property income and a BLOC (like a HELOC) is seen to be more risky. HELOCs were closed in the last down turn, because banks need to have cash on hand to facilitate draws. Fixed rates on DSCR can be lower than revolving funds.
Thanks love this show!
Loved this video, great content.
How much is a good passive income??
Very Informative content. Thanks for sharing this video.
You are the best. Love these 43:09
140k to cash flow $100 in Florida? Nuts.. REITs cash flow so much more and you're not tied down to a location.
Implementing the BEAF methodology following the greatest period of price appreciation ever seems a bit too risky for me.
Best of luck!
I have a house bought in 2004. Should I sell it and invest to owner occupied multifamily house?
You don't have to pay the capital gains tax if you sell and put your money in a DST. You will get cash flow as well. This is especially good if you don't want to be a landlord anymore ! I with tax attorneys who can set thos up for you. Let me know if you're interested .
I have equity but my business has been losing money for 6-12 months. Can I still qualify to buy another property ?
Its very expensive to borrow equity with the current interest rates.
All the home equity lenders I have contacted don't do investment properties.
Hey David, I am looking to do a partnership with my dad on a Lakehouse down here in Florida. Is it possible to get two separate mortgages upon purchase? He plans to pay his half off sooner. Do you know of any partnership loan products or have any advice?
To Sell from Old Middle English "Sellan" means to Give--not take as we interpret it today.
Buying investment properties with negative or net-zero cash flow.....is just the same shtick I heard leading up to 2007
Is there a chief risk officer at bigger pockets?
I always double check numbers with a good real estate Appraiser to help analyze our risk.
your the truth 🙌 💪
Are there any challenges with accessing equity from a mobile home park...anyone?
That Beardy dude sure seems to have some wisdom. Lol
We never have 100% control. Which is where I have an issue with the concept of extreme ownership.
Do I need a down payment for DSCR loans?
Yes, unless you already own the property and just refinancing it.
I want to set up an investment rental property for my special needs son. Something where he can get cash flow every month.
Simple to do. Just bought my 10th in 2 years
Hi David,
I have a three bedroom townhome with association fees for $375 and trying to sale it due to high fees . What your thoughts on my decision to sale?
Grace
give all the details
My grandpa was buying the smallest home in the nicer neighborhoods
Smart grandpa!
Bought my 12 unit property with a downpayment from my HELOC on my paid off home.
How much did Alex Hormozi pay you to mention his book?
I can’t think of a worse investment than an AirBnB in Florida right now
Jed, you have all the ingredients to be a great salesman-just shave and be clean cut. No tattoos, blue hair, or piercings. Also, don’t smoke. Always look fresh, clean, and professional.
I’d get a nice polo shirt with a company logo on it. Uniform khakis. Drive a nice, clean truck with your logo on the side of it. Lastly, have a nice, easy to read business card with your company logo on it.
I don’t have home equity
Does a heloc affect your credit to buy another property?
It does if the mortgage is under your social versus an EIN.
Yes, similar to a big credit card. It moves your DTI higher
To the kid with the question just go straight to Alex Hormozi
Sweat Equity
Guy calling in from Shanghai is talking as if China were just like the USA when it comes to private property (among many other concepts). Good luck getting your money out of China.
If the banks call in your loans - which DOES happen - you will be bankrupt. Banks are struggling right now. Debt is evil. Pay cash or don’t do it.
‼️‼️‼️🤾🏽♀️💯
Dudes name is bigger pockets and he’s talking down on salesman . Haha ok
Bigger pockets is the name of the whole community and the website. His name is David.
FIRST
This is NOT the time to invest in real estate, This guy is trying to profit off of people that will ultimately default on their loans.
I’ve been finding deals on foreclosed and probate houses. It depends on one’s strategy. I also like buying with seller financing rather than bank financing.
It’s about buying income rental properties at the right price, right condition and buying at the right location. ❤👏 @GilbertChecoury
And winning the lotto is about picking the right numbers
lol
@@alldanamesrtakn I am sorry but that is dumb to say because it is impossible to know the right numbers to win a lotto--But ENTIRELY possible to know
What is a good location criteria
What is a good (enough) condition criteria and
What is a good price for you taking many factors like the first 2 plus your finances and the income potential of a house--which makes it NOT a total crapshoot--unless one is too lazy to do the legwork--which can be an issue a lot of folks
Location & deal is everything
Yes!
Thank you for this one.