Investing in Rental Properties

June 20, 2016

Why You Should NOT Own Rental Properties….perhaps.

  Some investments just are not good for everyone.  Real estate is one of those investments. If you identify with any of these following Top 7 Reasons why investors fail in real estate investing, please seek professional guidance before something goes catastrophically wrong for you. Insufficient Capital–things break, plans go sideways, tenants misbehave.  This is, in my professional experience and opinion, the Number One reason investors go crazy or go broke.  Almost every investor I know can easily, if not guided by hard numbers and calculations compared to ‘their gut, their instinct’, will commonly Over-Estimate Revenue and Under-Estimate Expenses.  Both cause trouble, but in different ways. Inability to Control Your Emotions–The old saying of “If it was easy, everyone would do it certainly applies to real estate investing.  The ability to control your responses to certain events is what separates the folks who last in the business and those who flame […]
August 4, 2016

Is the sky falling on asset prices or should we just wring the neck of that screaming chicken to shut him up?

“The U.S. Treasury’s Office of Financial Research noted this week that stocks have reached today’s valuations “only ahead of the three largest equity market declines in the last century.” Certainly NOT what I wanted to read while sipping my first cup of coffee this morning.  WTF??? But….as in all good thought-provoking pieces it’s valuable. Yes, a bit of a butt-puckering scary article but still valuable. Here’s why I think it’s valuable: If asset prices plummet, we will see opportunities to pick up new properties from distress situations.  So perhaps keep some of your powder dry to seize these rare market fluctuations. It’s time to re-evaluate each of the properties in your portfolio in a kind of stress-test scenario.  For example, do you know what the Break Even rent value is for each of your properties?  (Hint:  If you don’t know how to calculate this, send me a message and I’ll walk you […]
August 18, 2016

Top 20 Questions (that will spawn 20 more….)

Questions. We all have them. (If you don’t, run away from real estate.) Here’s the Top 20 questions asked by landlords and investors when choosing to hire a property management company. Some are deeper questions than they might seem the first time you read them, which is why the first question on the list is the first question on the list.  If you are thinking about them in the correct mindset, you should realize within 2 breaths that the questions spawn subordinate questions and will take you down a rabbit hole even further. What do you charge? If I have a question and send in an email or call, what is the expected response time from your company? Is the prop mgr available on weekends if issues arise? How do you handle repairs? How does money get to me each month? What happens if the tenant doesn’t pay rent? What […]
August 26, 2016

Crowdfunding for Your Real Estate

You’ve heard of Crowdfunding for all kinds of funky new products and companies, but real estate?  No, you’re not doing a double take. Yup.  It’s here. Check out this article about crowdfunding and how it can impact your Retirement Plans. http://money.usnews.com/investing/articles/2016-08-23/pros-and-cons-of-real-estate-crowdfunding-for-retirement  
September 8, 2016

Are we in another Housing Bubble already?

  Kids like bubbles.  Even dogs like bubbles. Real Estate Investors typically don’t like bubbles.  But it doesn’t have to be that way if you think about it…. A recent article on CNBC highlights the possible statistics pointing to another Housing Bubble for specific States and Cities in the US. However, unlike the last major bubble, the underlying forces causing this bubble are distinctively different. Here’s the full article link:  http://www.cnbc.com/2016/08/29/were-in-a-new-housing-bubble-why-its-less-scary-this-time.html My favorite Take-Away paragraph from the entire article is this…. “Rental demand, especially for single-family homes, is very strong and is an attractive income stream for individual investors and current homeowners. As millennials age into their prime homebuying years, more than ever before they are choosing to rent single family-homes, because they either don’t meet mortgage credit requirements or are unable to save for a down payment because rents are so high.” So, if you’re worried how the housing […]
October 31, 2016

Unless you’re already a Millionaire you might want to read this….

Forbes recently published a concise article on how real estate investing can help you become a Millionaire. Yes, there are plenty of folks making this claim, but I do like how this author augments it with counterarguments that it’s not for everyone.  In other words, it is not easy.  Doable, but not easy. Here’s the link to the article: http://www.forbes.com/sites/brandonturner/2016/10/18/4-things-you-need-to-become-a-millionaire-through-real-estate-investing/#119bf80732b8 (Sidenote:  If you’ve been a student in any of my courses for the Indiana Association of REALTORS (IAR) continuing education classes, MANY of his bullet points will look extremely familiar as we covered these in granular detail.)  
November 10, 2016

YTD Rental Stats

Here’s the YTD stats for the Indianapolis area through October.  Still solid demand, although we are monitoring Zionsville closely as the DOM has ticked up there, perhaps due to the trepidation of the election overwhelming folks lives last month. indy-rental-stats-ytd-thru-october-2016 While you’re reviewing the numbers, how about you help your friend learn about real estate investing by forwarding this email to them so they can subscribe, too?  (It’ll make you rich….it’ll make you thin.  It’ll make you rich and thin.) (ok….it won’t make you thin, but the rich part is highly likely.)    
November 10, 2016

Legal Tender–Estate Planning

   
November 15, 2016

Should You Sell All Your Rental Properties?

ARGGHHHHH!!!!! Economic uncertainty is nobody’s friend but lately, if you watch the talking heads and read the mass media pundits, you would think the world is coming to an end and the rapture is here. I’m not so certain these folks are using the correct lens to look through for their prophesies…. This article by David Lynn, Ph.D., covers some of the flight and self-preservation concepts very nicely.  He also reminds the reader that business is a cycle with repeatable stages of peaks, contractions, troughs, and expansions. “So where are we now?” is the BILLION dollar question, isn’t it? Here’s Dr. Lynn’s conclusion for those of you who don’t care to read the entire article: We are in a very unusual situation in that the normal pattern of oversupply has not occurred in this real estate recovery. This bodes very well for the real estate market. Over-supply has always killed […]
November 17, 2016

Thursday’s Legal Tender Tip–property rights