Debt Free

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Fox Tv GIF by Rosewood
 
I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
Rental properties are a great way to reduce your taxable income and the mortgage interest is a tax write off.
Keep building up your stable of rentals until you get to a point where you don’t have to work anymore.
 
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I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
Rental properties are a great way to reduce your taxable income and the mortgage interest is a tax write off.
Keep building up your stable of rentals until you get to a point where you don’t have to work anymore.
That’s what I did and it worked. I’m retired , SS, rental and interest income and things are pretty darn good. It’s great advice.
 
I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
Rental properties are a great way to reduce your taxable income and the mortgage interest is a tax write off.
Keep building up your stable of rentals until you get to a point where you don’t have to work anymore.
We had rentals too....

They became a bit problematic trying to keep decent tenants in them.....and we are really glad we sold them before this new wave of tenants came in that you basically can't evict......

....................my neighbor has had a tenant that hasn't paid rent in a year who we wasn't allowed to evict...the tenant even sued him and although the tenant lost, it still cost the land lord money for a lawyer.

Now the tenant is paying rent and was ordered to back pay the rent he didn't pay.....at least that was sorted but the neighbor had to carry him for a year...

My mother owns a 6 complex town house and over the past year has used all of her savings to do maintenance (roof, septic system) and had a tenant who trashed their townhouse and snuck out in the night leaving a lot of their broken and wrecked belongings and not paying rent...she went after them but her lawyer said it would cost my mother a lot of money to capture any money at all as the tenant declared bankruptcy and went into the welfare system...

It cost my mother $10k to renovate and repair the town house....

....so the morale of the story is rentals are hit and miss as well, all it takes is a bad tenant or a major repair to off-set any profits.

However if a person owns rentals in a university town, they are practically guaranteed an income as those properties are all rented at a premium...
 
I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
Rental properties are a great way to reduce your taxable income and the mortgage interest is a tax write off.
Keep building up your stable of rentals until you get to a point where you don’t have to work anymore.
Can’t disagree with that.
 
We had rentals too....

They became a bit problematic trying to keep decent tenants in them.....and we are really glad we sold them before this new wave of tenants came in that you basically can't evict......

....................my neighbor has had a tenant that hasn't paid rent in a year who we wasn't allowed to evict...the tenant even sued him and although the tenant lost, it still cost the land lord money for a lawyer.

Now the tenant is paying rent and was ordered to back pay the rent he didn't pay.....at least that was sorted but the neighbor had to carry him for a year...

My mother owns a 6 complex town house and over the past year has used all of her savings to do maintenance (roof, septic system) and had a tenant who trashed their townhouse and snuck out in the night leaving a lot of their broken and wrecked belongings and not paying rent...she went after them but her lawyer said it would cost my mother a lot of money to capture any money at all as the tenant declared bankruptcy and went into the welfare system...

It cost my mother $10k to renovate and repair the town house....

....so the morale of the story is rentals are hit and miss as well, all it takes is a bad tenant or a major repair to off-set any profits.

However if a person owns rentals in a university town, they are practically guaranteed an income as those properties are all rented at a premium...

Every once in a while I see rental policy claims for "vandalism." It's hard to believe how some people live.

Back during the housing bubble, my wife and I were so confused about how all the neighbors had fancy cars and boats. Then we learned that they were treating their home like an ATM. Glad we skipped that.
 
We had rentals too....

They became a bit problematic trying to keep decent tenants in them.....and we are really glad we sold them before this new wave of tenants came in that you basically can't evict......

....................my neighbor has had a tenant that hasn't paid rent in a year who we wasn't allowed to evict...the tenant even sued him and although the tenant lost, it still cost the land lord money for a lawyer.

Now the tenant is paying rent and was ordered to back pay the rent he didn't pay.....at least that was sorted but the neighbor had to carry him for a year...

My mother owns a 6 complex town house and over the past year has used all of her savings to do maintenance (roof, septic system) and had a tenant who trashed their townhouse and snuck out in the night leaving a lot of their broken and wrecked belongings and not paying rent...she went after them but her lawyer said it would cost my mother a lot of money to capture any money at all as the tenant declared bankruptcy and went into the welfare system...

It cost my mother $10k to renovate and repair the town house....

....so the morale of the story is rentals are hit and miss as well, all it takes is a bad tenant or a major repair to off-set any profits.

However if a person owns rentals in a university town, they are practically guaranteed an income as those properties are all rented at a premium...
I guess it depends on where and which neighborhood, as well as how it is managed.

Where I live now, the kind of people who move here and live here are folks who escape NY and CA. They rent for a year or more while they build their last dream home. Mostly retirement folks, very decent people.

I had a rental when we lived in CA, did a thorough reference as well as background check before accepting a tenant. Never had an issue.
 
I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
Rental properties are a great way to reduce your taxable income and the mortgage interest is a tax write off.
Keep building up your stable of rentals until you get to a point where you don’t have to work anymore.
While I appreciate this sentiment. And have never complained when I did it. However I have grown to like REITs.

REITs give you the same benefits, without the hands on landlord challenges. I sort of like that part. You can pick your market. Pick your product. And don't have to live anywhere near them to make them work for you.

Whatever you like for rentals, you can find a REIT that has them.
 
I guess it depends on where and which neighborhood, as well as how it is managed.

Where I live now, the kind of people who move here and live here are folks who escape NY and CA. They rent for a year or more while they build their last dream home. Mostly retirement folks, very decent people.

I had a rental when we lived in CA, did a thorough reference as well as background check before accepting a tenant. Never had an issue.
There are always variables of course....

In our case, our tenants were decent, we vetted them and got lucky...

In our neighbor's case his tenant was a dependable long term renter who for 3 yrs was an excellent tenant, something happened and he fell apart.

In my mother's case, her manager did a very thorough background check and the tenant was very well endorsed by his previous land lord....

What wasn't disclosed was the previous land lord did his best to dump this tenant on my mother....he most likely saw this opportunity to unload his burden.......and it worked...
 
There are always variables of course....

In our case, our tenants were decent, we vetted them and got lucky...

In our neighbor's case his tenant was a dependable long term renter who for 3 yrs was an excellent tenant, something happened and he fell apart.

In my mother's case, her manager did a very thorough background check and the tenant was very well endorsed by his previous land lord....

What wasn't disclosed was the previous land lord did his best to dump this tenant on my mother....he most likely saw this opportunity to unload his burden.......and it worked...
Ugh, that can be bad news. My son had a similar experience.
 
Everything has to be political, huh Rojo? This thread is about making good choices, WAY more important than who's in the White House.
Give it a rest, dude.
 
I’m going to go against the grain here and say you should use your equity to acquire more property.
Take out a mortgage and buy a property to rent or to AirBNB. Use your asset, don’t just sit on all that equity.
I had three clients and a friend that lost both their rentals and their own homes, PPOR, in the 2008 GFC. I for one don't think you should gamble with your home. In the good times it works (2000~2007) but in a downturn it's a tragedy at the worst and a millstone at the best. You never do it after a big rise in home prices though. 2009~2010 was the last time it made sense I think.

"So you have to ask yourself, am I feeling Lucky? Well are you?"


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I had three clients and a friend that lost both their rentals and their own homes, PPOR, in the 2008 GFC. I for one don't think you should gamble with your home. In the good times it works (2000~2007) but in a downturn it's a tragedy at the worst and a millstone at the best. You never do it after a big rise in home prices though. 2009~2010 was the last time it made sense I think.

"So you have to ask yourself, am I feeling Lucky? Well are you?"
Luck has very little to do with it. Good choices. I’ll bet your clients and friend made at least one bad choice. I’ve been a landlord through all the time you mentioned. 1999 to present.
 
If you’re handy another great way to go is to fix and flip houses.
You really have to have a keen eye for what’s needed in an old house( usually kitchen, baths, floor coverings, roof, paint and sometimes landscaping).

There are lenders who specialize in this market and lend you the money to buy AND to remodel based on the anticipated value after the renovation.
It’s risky though since the purchase is made as-is with no inspections but if you know your market and have a good sense of what it’ll cost to refurbish you can do very well.
And we’re talking Home Depot kitchens and baths here, no high end stuff.

Eventually you build a team of guys you always use for specialty work, a realtor you always use to buy and sell, and you develop a copycat method of refurbishing that you use over and over.

Bigger profits can be had if you refurbish commercial properties using the same methods.
 
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