I make money, then spend it. Don’t care.
The best way to save money is to make money. If your not doing all you can to make money, then the boat has been missed.
I agree, its just plain SMART to do what Tracy suggests…
Its also smart to invest, but only to do so wisely. Sometimes its better that some people simply pack it away in acct, but for many others that carry with them skill sets and genuine interest, the best move is to invest in something that embrace’s that interest or skill.
Me… I like Real Estate and Cars.
Real Estate simply pays, although under likely tax law changes, it will not be as good as in the past.
One could invest in the inner city, which usually means more repairs and harder collections, but monthly cashflow.
One could buy in the burbs, make little to no monthly cash flow, but easier collection and maintenance.
I have done both. In a rising market for investors, when tax laws look good for investors, I buy inner city, update, rent and sell, knowing the investor pool has grown. (Thats one reason I loved the Romney hopes), its easy to show good ROI on paper and sell high.
Aside from some inner city stuff, I have 4 suburban two families… one is paid and the others each will be paid off (within 10 years). My tenants will have paid for all four houses, and I will be left with 10k a month income, and over $1 mil in home values…just from those 4 homes (Colonie, Latham and Halfmoon areas). While not the case for me, its OKAY to buy a suburb 2 fam and have to pull money from your pocket. WHY? Well, lets say I pull $200 (over and above rental income) a month from my pocket to cover mortgage and repairs, vacancies…thats $2400 a year…in 15 years that $36,000… but the end result is you own the home and still have rents coming. Obviously, depending tax laws, you may choose to re-fi.
That same $36,000 in a stock/fund could be 25k or 75k… but not $200,000 k in real estate equity, with a $2k monthly income stream, and additional buying power.
My point is, I found what works for me and can work for many, but certainly not all.
If one starts as Tracy suggested, and saves money for down payments, or education on how to do what they love for money, then the battle won, leads to a war won. It all starts being smart from the beginning, doing the little things suggested in this thread.
As for cars, thats just a loss, for most. But some became a dealer because its the only way to drive what you want for a profit or break even.
The point:
Save enough to do something you love.
Many of us love spending.
jammer for president
Jammer since you brought up the topic did you initially invest in urban or suburban income property?
urban if you wanna make some quick cashflow going and fastest roi
sub if you want retirement money when your old and wrinkley and dont give a shit about cars and nice things, rather basic living and keeping the shit from sliding out of your asshole anywhere else but a toilet.
just my opinion 
but jammer prolly has way more stacks then me lol
Well it’s kind of a complex problem and there are a lot of variables to it. It all depends on how much money your working with, what your experience level with rentals is and how risky your willing to go. Also right now financing is very difficult on multifamly (1-4 units) and damn hard for comercial unless you have a nice big pile of money.
the only real variable to buying in a urban area is scummy tenants who dont pay or dont value there space and may wreck a carpet or put a hole in the wall here or there… Me and a buddy just bought a 2 unit on pleasant st in schenectady needing absolutely nothing but maaybbee paint for $3,000 up front and we assume taxes which are 11k… i dont give a fuuuckk if i get a scumbag tenant who ill have to evict here or there, having a 250k mortgage on my shoulders sucks (at least in my eyes)… At 14-20k a property which theres a TON of, you will NEVER loose money.
The flawless way to get the best of both worlds is to look in troy. Troy has the BEST eviction rules that i know of and may be a little more expensive then albany/schenectady/amsterdam but not by much. Troy is you dont pay you get 14 days and then get the fuck out, albany and schenectady can take months, but still, the bad doesnt out weigh the cost to profit ratio in my opinion.
section 8 is guaranteed rent money
i was actually gonna edit my post and add that in there… Section 8 is only in shitty areas pretty much, you have to make the apartment a little nicer then most in that area, but if you do, boom, you get checks mailed to your door step monthly by the state. I’ve never done section 8, but next couple properties i should… knowing me ill rent until the first tenant fucks me and then flip the property. lol
actually the property in saratoga county I just bought has 2 section 8 subsidized tennants in it. One is a elderly women the other is a veteran that has experienced a tramatic brain injury. Both have good tennant history and both apartments are nice enough that I would live in them and neither have been damaged by either tennant. All depends on what you want to deal with and how much equity/cash you have to work with. I have no interest in dealing with scum that I have to evict no matter the profit margin. It’s just not worth the headache to me.
didnt no section 8 could apply in better areas… and its a headache with 25 bills a month, dealing with a dirtbag once a month isnt nearly as bad… I could own a half mill house right now with a gtr, ferrari even a lambo sitting in the drive way, but fuuckkk that, the headache of knowing i gotta pay payments on that shit every month? heellll no, ill take my shitty cash bought house and paid off cars… my monthly bills consist of electric/cable and thats IIITTT… taxes every few months… i love it
Meh, I’m doin’ iight…
lol
Battlin with Krazy for character count…
Dave’s right on some important points…
The inner to mid city / lower income properties make quick money… if you start with good bones it helps alot in the overall process. I started with 21 units, ---- (3) 4 unit bricks on the cohoes hill and ab4 unit on Van Scheik island in cohoes. A 3 unit in albany on lower Myter near the Mansion and a two unit in schenectady.
For Cohoes, I made it a point to make friends with TM, who runs section 8 in Cohoes and I filled the units inside a few months. I catered to government pay, perhaps as a way to get some tax dollars back! The Cohoes units alone made me $3600 a month, but I was always fixing something the 1st 2 years. I have since learned that with all new purchases I immediatley put in new sink faucets, traps and often toilets. Just to eliminate plumbing calls. It doesnt cost much at all. Lucky for me the investor market rose with Bush in office and I cashed in pretty well… and began a slow grow into a low maintenance arena (and spent freely enjoying that era life).
The point is that its a fast lane (5 years or less) of gaining enough cash to get a foothold into better properties… but be prepared to work for it. Showings, cleanings, evictions, every excuse to tug your heart from tenants, and all the BS that can with it. Again, I suggest public money if you can keep a decent place and do the right paperwork and be quick to resolve issues. Relationships matter in the placement and getting well placed.
Even in my Colonie 2 family, I have another version of public funding (disabled) so leases are triple net.
There are many options for public funding, my Sch 3 fam near union has tenants from yet another organization. There are many groups that are not section 8 or DSS that are worth courting. And let no one fool you, easier success comes with those very relationships you seek to build. You build them buy being persistant, providing a better product, being responsive and generally a good bright human. Either you got it or you don’t, and if you don’t, its a game that requires more work.
Buying the ultra cheap works well for many, but often there is a reason they are ultra cheap. Taxes seem to be a strong cause of this type of havoc in some areas, especially parts of Schenectady. My three fam has 10k in taxes and insurance. Thats 1/3 of rents. And we get god rents! But, a 15k house can work, but for me, thats just not likely going to result in a tenant I personally wanted to deal with, or at least anymore.
I am more goal oriented now. I know that at minimum I will have “X” at a certain point in time, say, 10 years. So now I can play more, with less stress, to keep moving forward at any pace that may pop in front of me within reach, without fear of risking everything.
So, yes, Daves idea works… just as Sullys does, and Hatfields, on different points along the spectrum.
Buy inner/mid-city if you have time and willingness for the aggrivation, have some skill or ability to get help at low cost, but will be rewarded for it now and thus a step up in a few years,to more or better (what I would do if I was still in my 20’s, and was my path).
Buy suburb first if your more safety oriented , want a guaranteed cash flow later, along with big equity, and really don’t believe a Lambo should be in reach anytime, cause you will be too practical when that amount of cash piles up, but it will pile up.
Keep in mind tax law changes that are very possible under Obama will greatly effectthe growth potential in many many way, including more quality public housing (due to programs) becoming available, limiting renter pool. Taxation on Capital gains, and on the earned income… which are already under verbal attack and likely will be addressed, with the homeowner/ landlord experiencing the ill effects.
Fuck it, sell ice cream.
Theres actually alot of low income people/houses in Saratoga county. Everybody seems to think its a ‘money’ area but thats only certain parts of it. Its not Schenectady ghetto/hood but still low income.
Mechanicville even has projects.
I’m going to buy a couple $8k homes in Amsterdam to rent out.
Theres a house in amsterdam on forbes st, i forgot the address but theres a sign out front but the inside of the house is MINT, needs a furnace and a roof and youd be set… Theyd take $5k
might be worth it to take a drive down
Deff dude. Is it a foreclosure or what. Prolly 30k back taxes owed on it lol.
no, the owner, a divorced woman just wants out of it… She is paying all of the taxes on closing… All your responsible for is the $5k and you get a clean warranty deed with up to date taxes… I would have bought it myself but I didnt like the set up of the house… you have to walk up like 40 steps to get to the house… no different then the second floor of a 2 family but still, just wasnt for me… DEF money to be made there though, even if you flip it and make a quick 20k
You guys with all these rentals, any advice for someone just starting out? I’m renting now, but have a good bit saved up and want to get myself into a halfway decent multi-family somewhere, and then buy a few more properties down the line when I can, and hopefully grow from there.