[WestCoast]

I do not own rental properties so I can not say if it would or would not work.

I do not talk about things I have never done before.

[worldwidetraveler]

(05-20-2013 10:55 AM)Cruisen_Chubby Wrote:  

If you've driven a Chevy can you give advice on how to drive a Ford? Or is being a landlord and a property manager that much different?

Do I see what the landlord does? Yes. Do I see what the landlord makes? Yes. Do I even advise the landlord on financial investments? Yes. Have I done this for more than one property owner? Yes.

I wouldn't be asking someone who never drove before for advice on driving if that is what you mean.

[worldwidetraveler]

(05-20-2013 10:52 AM)reaper23 Wrote:  

I own commercial real estate. In my opinion it is the better way to go than residential. The leases are triple net which means you are not subject to any tax rate risk, the tenants pay all taxes, insurance and utilities. In strong markets you can also make the tenant responsible for all physical upkeep of the building as well.

Hell, the easiest thing to do is buy commercial land and lease the land to someone who will build their own building and maintain it themselves.

This happens all the time all over the country.

With respect to management companies, yes some will gouge you but some are good and worth it. I have worked with some in the past and find the good ones to be worth every penny. The best plan is to build and own enough rental units that it makes sense to have your own management company.

If I were to get back into single families, it would be in financing and not rentals. I can't see it being more passive than financing unless you have to take back the house and resell it again. That is a happy situation because it normally means a pay raise.

[worldwidetraveler]

(05-20-2013 11:01 AM)WestCoast Wrote:  

I already gave my advice on here. Nice cupcake attack, original too.

The guy has to regurgitate insults as well.

[WestCoast]

WW sounds like you actually have done this before do you have time for a quick breakdown of the puts and takes?

[worldwidetraveler]

(05-20-2013 11:31 AM)WestCoast Wrote:  

WW sounds like you actually have done this before do you have time for a quick breakdown of the puts and takes?

Oh man, it's been quite a while since I was into real estate. I wouldn't even advise people to do what I was doing. It was a full time job and not passive at all.

I didn't purchase houses for cashflow. I wanted equity right away and that meant marketing my ass off to bring in a ton of leads to get deals with equity.

That was the time I got into reading up on sales and trying stuff out.

I did love the deal making but I find my current business has a more global reach.

I think the financing aspect of real estate kicks ass. You can set everything up to go through loan servicing companies that will take payments for you and send off year end reports.

All my money is in my software business right now.

I do plan on funneling some of those profits into short term rehab financing (hard money) in Georgia or Texas. They have short foreclosure time tables in those states. The hard money guys can get 10% - 15% with points. Normally 6 month terms and that allows you to collect more points. I want to set up a loan broker to take care of all of that for me. It will take me time to set up but that is what I am looking into after I finish up some software projects.

[Cruisen_Chubby]

(05-20-2013 11:15 AM)WestCoast Wrote:  

I do not own rental properties so I can not say if it would or would not work.

I do not talk about things I have never done before.

Earlier in the thread you suggested to roll over his 401(k) into a roth. Have you done that before?

How do you suggest he do that?

Rolling over a 401(k) to a roth "To get it liquid"? Wait, what?

How will it be any more liquid as a Roth?

Please tell me how your plan of rolling over to a Roth IRA from a 401(k) will work out better for the man trying to draw on his retirement and live abroad.

The questions I'm asking you are much easier than the ones asked by Dexter so you shouldn't have a problem with these.

[WestCoast]

Yes I have rolled over a 401k to a Roth IRA.

Basically what you do is wait till December 31 to do the roll over. When you switch firms. Now you wait 4 years and 1 day and can take the principal out. You pay the taxes over two years. You can go ahead and google it if you'd like as well.

Note you can only roll over retirement money that is not with your current employer which is why I asked him that as well, there is another thread on here where I explained all this and all the 401K rules are on the blog I help run as well.

If you don't believe me go look at Wikipedia and check the sources yourself or call up your brokerage firm. http://en.m.wikipedia.org/wiki/Roth_IRA

Most people don't know about how to work the retirement system so yes it is more liquid.

He is more liquid because at least now he can take the principal out in 4 years and 1 day, called the 5 year rule because it's 5 tax years. All this is in the thread, the other thread, or blog if you want it spelled out in a quick fashion.

Finally, another reason why I suggest abroad is so you can minimize US money made, now when you draw down when you are abroad, you can work a couple of years abroad, draw down on the 401K and pay minimal taxes because that is your income bracket in USA dollars earned. Yes I own properties abroad.

So yes I have done all the things I am advising him to do (except leave the country which was a cost of living suggestion).

Note this is a great way to get liquid if you work on Wall Street try to get promoted then switch firms and get promoted again. Continuously roll over, now the vast majority of your money is liquid. I have maxed out my 401k every single year, however the principal I accumulated over those years is now sitting in my personal investing account.

I also addressed the question on housing on a separate thread where I placed my opinion.

[reaper23]

you could also just take a loan against the principal and pay yourself interest, pay no taxes at all, and get about 50-60% of the principal available

[Lothario]

(05-20-2013 03:20 PM)reaper23 Wrote:  

you could also just take a loan against the principal and pay yourself interest, pay no taxes at all, and get about 50-60% of the principal available

What is the amount that you can take off from 401K account at a time ?I think there is a limit $ 25,000 for House Remodeling etc and or $ 25,000 as a Personal Loan. No more then $ 50,000 at a time ? Is that right ?

[Seduction Sutra]

If you rely on 401k for your retirement, you're violating the ABC (Always Be in Control) rule.

http://boldanddetermined.com/2013/05/20/...n-control/

[Cruisen_Chubby]

(05-20-2013 03:45 PM)Seduction Sutra Wrote:  

If you rely on 401k for your retirement, you're violating the ABC (Always Be in Control) rule.

http://boldanddetermined.com/2013/05/20/...n-control/

Victor has a lot of motivating stuff but he is not a financial advisor.

Do you do all of the things Heartiste tells you to do as well?

[WestCoast]

(05-20-2013 03:36 PM)Lothario Wrote:  

(05-20-2013 03:20 PM)reaper23 Wrote:  

you could also just take a loan against the principal and pay yourself interest, pay no taxes at all, and get about 50-60% of the principal available

What is the amount that you can take off from 401K account at a time ?I think there is a limit $ 25,000 for House Remodeling etc and or $ 25,000 as a Personal Loan. No more then $ 50,000 at a time ? Is that right ?

You are asking a complex set of questions because of your background. You can either lay out all your assets + what you want to do on here or PM me and I can give you workarounds for what you want to do.

Also with your job since we have met in real life, there are a lot of loops you can probably jump through to lower your tax bill.

[TheCaptainPower]

I'm not retiring in SEA, hells NO.

So is the answer to our generations retirement that everyone is going to start buying up homes??

Sounds like it's going to be easy to get cheap rentals in the future since people will be DIEING for tenants....(except in big cities of course)


Was looking at south beach Miami rentals today and I can get a one bedroom for $700 a month, I'm already up to $400 a month in passive income, so maybe I will never buy.

[samsamsam]

(05-20-2013 05:39 PM)TheCaptainPower Wrote:  

Was looking at south beach Miami rentals today and I can get a one bedroom for $700 a month, I'm already up to $400 a month in passive income, so maybe I will never buy.

What is the cost to purchase one? I have not checked lately, but in many parts of the country the monthly mortgage costs are lower than rent for the same property. Also, remember what is the rent is now, may not be the rent when you chose to move there. That is one of the bigger reasons why you would buy, to have a locked down cost, aside from repairs, insurance (I would be a bit afraid of sudden rate changes in FL) and property taxes.

Back in 2006 did a 1031 and I wanted to lock down rates, I didn't want to deal with any future spikes so I did 30 year locked. I knew the next few years would be crazy but once the pain was over (not sure if it is) that rates would rise and I didn't want to deal with trying to refi in a high int rate environment and didn't want to subject myself to floating rates. Plus, I knew the properties could support the fixed debt.

Sometimes, people want to game and maximize and really get down the the pennies of how to optimize and game a situation. But sometimes, having the peace of mind that you are capped on certain costs is very valuable. I don't have time to constantly check rates, etc. So in the short run 06-12, I paid some more int exp than I needed to. But I knew my paid was never going to be worse because they were locked. Fortunately, I was able to refi and my expenses are lower.

My point to all of this is - if you really want to move to Miami and you are concerned about your retirement. Then maybe buying would work. You would get the assistance of a renter and if you go fixed rate 30 year, you know your payments. Plus, you will have some equity. But property ownership is never as easy as real estate agents pitch it. But most things in life we want are never that easy.

I am not sure what your passive income is based on. I have a bunch of passive income - high teens to thirty percent cash flow - non real estate. Recently, one of my guys gave me a haircut. It was that or he was just gonna return the capital, so I took the haircut since I had no better place to put it. So if you are counting on that 400, I hope it is somehow locked and permanent. I was a bit surprised myself when I had to take the haircut. Don't get me wrong, the rate I am getting is better than what 99% of the people can find, but it was still a haircut.

[WestCoast]

(05-20-2013 05:39 PM)TheCaptainPower Wrote:  

I'm not retiring in SEA, hells NO.

So is the answer to our generations retirement that everyone is going to start buying up homes??

Sounds like it's going to be easy to get cheap rentals in the future since people will be DIEING for tenants....(except in big cities of course)


Was looking at south beach Miami rentals today and I can get a one bedroom for $700 a month, I'm already up to $400 a month in passive income, so maybe I will never buy.

Why do you need south east Asia?

$1M, 800K at 4% is 32K and that is for all your living expenses. You can get a decent spot for $200K in Texas/florida

[TheCaptainPower]

Several guy's recommended it. (SEA)

Miami has so many vacant condos that renting looks like a sweet deal. I'm scared to buy in case the financials are all messed up, I've heard some horror stories. But I'll gladly rent and use the pool and the beach

[WestCoast]

So just go to Florida when you're old. All set, you don't want to conventionally retire anyway.

[el mechanico]

Dude you don't want to be anywhere near Miami

[TheCaptainPower]

No? Key west? Ft Lauderdale?

I didn't like Tampa, but people at work swear by Ft Myers and Naples...

[WestCoast]

(05-20-2013 06:38 PM)el mechanico Wrote:  

Dude you don't want to be anywhere near Miami

Calling theGmanifesto

I've been waiting for the Florida city debate throughout all 2013 elmech vs theg

[el mechanico]

(05-20-2013 06:40 PM)TheCaptainPower Wrote:  

No? Key west? Ft Lauderdale?

I didn't like Tampa, but people at work swear by Ft Myers and Naples...

Hutchinson island or Sarasota, Bradenton or many other places that are also cheaper!!!

What do you like? Country life with acres and horses? You go to Ocala. Depends on your preference.

You like lazy spanish scam artists that don't speak english and over inflated prices? Miami is the place.

Tell me.

[TheCaptainPower]

I will have to do a Florida scouting report. I've been to Miami, Key west, clear water, Tampa, ......Orlando (only disney).

I drove from Miami to the keys, and I liked some of those towns south of Miami...Key Biscane?

[el mechanico]

(05-20-2013 06:50 PM)TheCaptainPower Wrote:  

I will have to do a Florida scouting report. I've been to Miami, Key west, clear water, Tampa, ......Orlando (only disney).

I drove from Miami to the keys, and I liked some of those towns south of Miami...Key Biscane?

People burn out in the keys, fast. It's like taking a long vacation but on a cruise ship if that makes sense and the prices are high because people dream about living there..It's just too small..

Key Largo the biggest seems to have the most longevity. You have to like the culture which I fucking hate there so listen to Jimmy Buffet 24/7 for a few months then tell me if you're sick of it. If yes, don't go.

[el mechanico]

(05-20-2013 06:44 PM)WestCoast Wrote:  

(05-20-2013 06:38 PM)el mechanico Wrote:  

Dude you don't want to be anywhere near Miami

Calling theGmanifesto

I've been waiting for the Florida city debate throughout all 2013 elmech vs theg

He doesn't know anything about this place and advocates not owning a car so that leaves out almost every single person on the planet or confines you to one square mile on South beach. That gets old quick.