I don’t understand real estate investments at all. I mean, I get the general idea of commercial real estate, but the few people I’ve known to have made individual real estate investments seem like they’re incurring more headaches than any possible return they’re generating. Like, if you’re a well-off doctor stepping out of a poker game at 10pm on a Friday to get yelled at by a tenant, what are you doing with your life?
My brother has a couple 4 flats. Everything is done by text, if someone has a problem he sends out the $15/hr Polish immigrant handyman to fix it. Probably C- quality for repair work, but whatever. Not that much of a headache!
Yeah it can seem like a good investment if you just look at the raw numbers but the return is way worse if you outsource the management to a property management firm, and if you don’t you’re just buying a job that you’re likely not qualified for (you have to learn how to market, how to write a lease, how to do repairs or find reasonable contractors who can be available on short notice, etc.). And it’s really luck of the draw with finding a good tenant, although I would suggest it is a little bit less luck to keep them once you have one. Even worse if you lucked out and are succeeding at all of that, then you’ll go on UP in your free time and get your feelings hurt in the Abolish Landlords thread.
There are scenarios where it makes a lot of sense, like if you’re a really handy person and have financial means above your desired standard of living and buy a duplex to live in half and rent the other. Then you are there to do repairs yourself and get to know your tenants really well, etc. A friend of mine did that and then moved out of the duplex when they had kids and has had the same tenant on one side for like 15 years now who pays on time and doesn’t trash the place and maybe they’re getting rent a little below market but the mortgage is fixed and it more than covers mortgage plus taxes, plus repairs and they have basically a stress free investment.
Buying individual houses (tons of work, low returns) is to me completely different from investing in commercial property (can be done passively, huge tax benefits, potentially better returns). However, you have to know a lot about CRE, and know the right people to get in good deals (most are terrible).
Yea the important part is the screening for good tenants. My brother goes for almost exclusively women in their 20’s with good credit scores. The hotter the better seemingly
Sounds very legal and very cool
Ha yeah totally. Although I know screening based on sex is presumably illegal every landlord I’ve ever met does say females generally make for much better tenants.
Is this just paid marketing with some data thrown in to disguise it as news?
In 2021, that $392,000 house was only $260,000. How do you leave that out of the tweet?
Yeah I was gonna buy next year. Seems no chance of that now.
Yeah I put in an offer on a house in 2021 for $655K and would have had a $2,689 monthly payment INCLUDING mortgage insurance. It wasn’t accepted, which may or may not have been a blessing. But I just looked at the math on like a $395K house and my monthly payment would be $2,850. Insane in comparison.
That house is worth a million now.
Zestimate says $720K.
So most likely it would take a couple weeks to sell if listed in the high 600’s and you’d be underwater after taxes and realoltor fees. But if you’re sure you wanted to live there for a long time it does suck not getting into a home with a low interest rate.
Houses are not selling around me even with substantial discounts. Sellers going from 200% of 2019 prices down to 180% are getting no action at all.
I’m indifferent about it now. Every now and then I think about how nice of a home it was, and every now and then I think I might be glad I didn’t lock in to living in the city. I made the best offer I could, and they got about $20K more from someone else.
But now it’s pretty crazy to see the monthly payment comparison.
Millennials are the anti-boomers, can’t catch a break. Crushed by GFC, student debt, skyrocketing house prices. Now housing is completely impossible. Next up, their asshole boomer parents either spend it all, ask them for money, or both, while manipulating the shit out of them.
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