Starting a 135 op?

On Feb 20, 1:40*pm, Larry Dighera wrote:
On Wed, 20 Feb 2008 12:37:49 -0800 (PST), Dan wrote in
:

Currently, when thinking about what I'd like to do when I "retire" I
think I'd like to fly a lot. *However, it is expensive so it would be
better to get paid to do it rather than spend big money on a hobby.

If your motivation is revenue generation, consider real estate
investment. *If you start buying foreclosures, and put enough equity
in them so that the rental income makes the mortgage payment, you will
be able to leverage your equity investment's appreciation by something
like 80%. *

What about your equity? Doesn't it deserve a return too? You could put
it in eTrade savings account and get 4% FDIC insured so why put it
into real-estate hoping to just get your payment out of it??

-Robert

On Feb 20, 3:46*pm, "Robert M. Gary" wrote:


What about your equity? Doesn't it deserve a return too? You could put
it in eTrade savings account and get 4% FDIC insured so why put it
into real-estate hoping to just get your payment out of it??

-Robert

Here's my recommendation - buy Garmin (GRMN). It's on "sale" right
now. Forward PE = 14 with a huge growth rate.

We all know that Garmin dominates the aviation GPS and avionics
market, but their automotive products are top notch as well.

--Dan

On Wed, 20 Feb 2008 14:46:03 -0800 (PST), "Robert M. Gary"
wrote in
:

On Feb 20, 1:40*pm, Larry Dighera wrote:
On Wed, 20 Feb 2008 12:37:49 -0800 (PST), Dan wrote in
:

Currently, when thinking about what I'd like to do when I "retire" I
think I'd like to fly a lot. *However, it is expensive so it would be
better to get paid to do it rather than spend big money on a hobby.

If your motivation is revenue generation, consider real estate
investment. *If you start buying foreclosures, and put enough equity
in them so that the rental income makes the mortgage payment, you will
be able to leverage your equity investment's appreciation by something
like 80%. *

What about your equity? Doesn't it deserve a return too?

Huh? That's the whole point.

Let's use $100,000 as the home price. If the real estate appreciates
at 10% annually, with a 20% down payment (the equity), you are able to
realize a gain of, not 10% of $20,000 ($2,000), but 10% of $100,000
($10,000) annually.

You could put
it in eTrade savings account and get 4% FDIC insured so why put it
into real-estate hoping to just get your payment out of it??

For the appreciation in property value. The rent payment just covers
your costs (approximately) over the life of the investment.

Real estate goes up and down, but over the long run, .... With the
rate of population growth worldwide, I don't see how it can miss. The
only true downside is the lack of liquidity, but that's not really an
issue for retirement income.

On Feb 20, 5:41*pm, Larry Dighera wrote:
On Wed, 20 Feb 2008 14:46:03 -0800 (PST), "Robert M. Gary"
wrote in
:

On Feb 20, 1:40*pm, Larry Dighera wrote:
On Wed, 20 Feb 2008 12:37:49 -0800 (PST), Dan wrote in
:

Currently, when thinking about what I'd like to do when I "retire" I
think I'd like to fly a lot. *However, it is expensive so it would be
better to get paid to do it rather than spend big money on a hobby.

If your motivation is revenue generation, consider real estate
investment. *If you start buying foreclosures, and put enough equity
in them so that the rental income makes the mortgage payment, you will
be able to leverage your equity investment's appreciation by something
like 80%. *

What about your equity? Doesn't it deserve a return too?

Huh? *That's the whole point. *

Let's use $100,000 as the home price. *If the real estate appreciates
at 10% annually, with a 20% down payment (the equity), you are able to
realize a gain of, not 10% of $20,000 ($2,000), but 10% of $100,000
($10,000) annually.

You could put
it in eTrade savings account and get 4% FDIC insured so why put it
into real-estate hoping to just get your payment out of it??

For the appreciation in property value. *The rent payment just covers
your costs (approximately) over the life of the investment. *

Real estate goes up and down, but over the long run, .... *With the
rate of population growth worldwide, I don't see how it can miss. *The
only true downside is the lack of liquidity, but that's not really an
issue for retirement income.

The long term average for real estate appreciation is 5%, after
accounting for inflation.

--Dan

On Wed, 20 Feb 2008 18:40:15 -0800 (PST), Dan wrote in
:


The long term average for real estate appreciation is 5%, after
accounting for inflation.


To do as well in the stock market it would have to yield 25%
appreciation, unless you're buying on margin.....

On Feb 20, 8:13*pm, Larry Dighera wrote:
On Wed, 20 Feb 2008 18:40:15 -0800 (PST), Dan wrote in
:



The long term average for real estate appreciation is 5%, after
accounting for inflation.

To do as well in the stock market it would have to yield 25%
appreciation, unless you're buying on margin.....

We're getting off-topic here, but this is a interesting one...

I see your point, however this is based on the assumption that market
rent can pay for _all_ of the following.

1. Payments on an 80% LTV mortgage.
2. Property Taxes
3. Insurance (including liability risk)
4. Repairs, maintenance, and upkeep
5. Homeowners association bills (if applicable)
6. Property managment company (or you could handle the 3am calls
yourself)
7. Also pay for the carry time required when between renters
8. Real-estate commissions when it comes time to sell.

Can market rent pay for all of this? I doubt it, but honestly I have
not done extensive research. Is anyone doing this who cares to share
with the group? Granted, #6 could be done by the owner...

--Dan

On Feb 21, 12:01*am, Dan wrote:
On Feb 20, 8:13*pm, Larry Dighera wrote:

On Wed, 20 Feb 2008 18:40:15 -0800 (PST), Dan wrote in
:

The long term average for real estate appreciation is 5%, after
accounting for inflation.

To do as well in the stock market it would have to yield 25%
appreciation, unless you're buying on margin.....

We're getting off-topic here, but this is a interesting one...

I see your point, however this is based on the assumption that market
rent can pay for _all_ of the following.

1. Payments on an 80% LTV mortgage.
2. Property Taxes
3. Insurance (including liability risk)
4. Repairs, maintenance, and upkeep
5. Homeowners association bills (if applicable)
6. Property managment company (or you could handle the 3am calls
yourself)
7. Also pay for the carry time required when between renters
8. Real-estate commissions when it comes time to sell.

Can market rent pay for all of this? *I doubt it, but honestly I have
not done extensive research. *Is anyone doing this who cares to share
with the group? Granted, #6 could be done by the owner...

*--Dan

I have a rental unit that I purchased at the height of the RE boom.
Bought it 100% financed with a 10 year interest only loan. Now the
market has tanked. I owe much more than the property is worth. The
payment exceeds the rent that I can collect. The last renter skipped
out on the last 2 months' rent, took our couch and a vacuum cleaner.
This after she let her kids overflow the tub and flooded the kitchen's
ceiling. We patched and painted the ceiling ourselves, because the
handyman wanted much more than a fair price. This renter also killed
our washing machine by washing her kids $300/pair sneekers and a way
too big comforter and arearug in it. We ended up having to buy a new
set washer and dryer because we wanted someting that matched and also
knew that the dryer is pretty old.

The new tenants are good people, but the rent just wont cover the
mortgage payment, so we have negative cashflow every month and
negative equity to boot. Since the new tenant moved in, we had to
install a new hot water heater because the hot shower only lasted 5
minutes. The plumber said it was calsium buildup. Oh yea, we also
had replace the shower plumbing because the mixing valve stopped
mixing.

Other than that, RE is an excellent investment.

Wil

On Wed, 20 Feb 2008 21:27:47 -0800 (PST), William Hung
wrote in
:

I purchased at the height of the RE boom.
Bought it 100% financed with a 10 year interest only loan.

That wasn't too smart.

"Larry Dighera" wrote in message
...
On Wed, 20 Feb 2008 18:40:15 -0800 (PST), Dan wrote in
:


The long term average for real estate appreciation is 5%, after
accounting for inflation.


To do as well in the stock market it would have to yield 25%


90% of all Millionares did it in real estate.