Hey you. Do you want to invest in a real estate project with me? Let’s say I find a massive apartment complex for sale for $50 million. If we get a bank loan with 80% financing (borrowing $40 million), this makes our down payment only $10 million. To get the $10 million cash down payment, we just need to find 200 people to put in $50,000 each. To keep things fair,
Real Estate
2020 Review and ROI of My Rental Duplex
Hey there, money nerds! How’s your 2020 tax return going? Who else out there besides me gets turned on by a long 1040 Form, multiple 1099-MISC’s, sexy AGI, and itemizing deductions for their MFJ status? (and who has no clue what the heck I’m even talking about? → don’t worry, that’s what H&R Block is for!) Anyway, I just received my annual Profit and Loss Statement
How Big Should an Emergency Fund for a Rental Property Be?
I got the following note from a reader the other day... “Joel, I noticed you keep a big emergency fund for your rental property. 2 questions for you... 1) It seems like you have too much cash because shouldn’t you only need 3-6 months of mortgage payments as a cash reserve? 2) Also why do you keep this emergency fund separate from your personal emergency fund?” Great
2 Big Investing Mistakes That Actually Made Me Smarter
Back in 2013, I bought 25 shares of Tesla stock. I remember seeing electric cars starting to pop up around my neighborhood at the time and thought they were so cool! Like most beginning investors, I checked the stock price every 15 minutes after making the trade. (Actually that’s a lie -- I probably checked the prices every 5 minutes! 🤣). My $1,350 investment in
Why I’m Transitioning Away from Rental Properties
First, I must preface: this is not an anti-real estate post. I think real estate is an excellent wealth building tool, and don’t want to discourage anyone out there from buying rental properties. That being said, I’m thinking about downsizing my rental portfolio this year, and don’t have any plans to buy more properties in the near term. A few people reached out and asked
Should you include your primary home in your net worth?
I got a question recently from a reader about my net worth tracking... “I was curious why you're not including your primary residence in your net worth equation? I know many people say it's not an asset. It's your home, you have to have a roof over your head, etc. Just wondered the reason. I include ours in the equation but didn't know if that's the typical way. :)” This
How I Appealed My Ridiculous Property Taxes
Last week I got my property tax bill. $5,185. Booooooo. Many counties across Texas decided that 2020 was a good time to increase everyone’s assessed property value, raising bills by a whopping 10 - 20% for the tax year. It’s a kick in the groin... Because not only are many people under a financial squeeze this year, Texas was already ranked #3 for states with the highest
How and When to Hire a Property Manager for Your Real Estate Rental
Since I live in California and all my real estate rentals are in Texas, I heavily rely on property managers to look after the day-to-day landlord responsibilities. I get asked about this a lot… Who manages the properties? How do you find a good property manager? What stuff do they handle, and is it all worth the cost? This post is a brain dump of everything I know about
The 1% Rule Explained, Using Malibu Mansions!
Do we really need another blog post explaining the 1% rule for real estate investing? Yes! Because I’m gonna explain it using examples with ridiculously expensive, multimillion-dollar beach houses that famous people live in. The 1 percent rule can be used in any city or state you are planning to invest in. It’s a general guide to quickly identify whether a potential
Rental Property vs Stocks – Tracking Experiment Continued …
A couple months ago I talked about comparing rental property vs stocks, using 2 of my personal assets as examples we can track over time. One is a personal IRA account (backstory here) which is invested in a total stock market index fund. The other is a duplex rental property located in Texas (backstory here). On July 1st of this year, both of these assets were worth almost
