Retired at 30 on Rental income

[BelfastFlyer]

thanks to the strong british pound there are a lot of people I know buying homes in florida and eastern europe and renting them out as holiday homes and making a nice profit from it (not enough to live on but in 10 years it will be good savings).

If only I didn't spend all my money travelling eh?

[buzzingtalk]

but how can you ever afford to (when your starting out) keep your self going- pay rent and put food on the table - and buy a house? you must have had a half decent job in the first place. my starting wage will be around £13000 a year after graduation, and my mum is 43 and only earns a few more grand than that a year. i take it you get into property you have to have a good job to suppliment it. plus the british council would kick you out if you were in council housin but bought a house.

would never invest in the uk, this country is going down!!

just wanted to know how you supported yourself while buying your first property.

[MeTurk]

Some banks will give you a 100% mortage, so you don't need a deposit.

[buzzingtalk]

ahhhh. i think id need to be renting a proper place (not council) before i took out a morgage on somewhere else. council would do you for it. its a lovely dream though

im hoping on investing abrouad, in asia. you can buy houses sooo cheap out there, and even though the returns arent as good as here in the uk, it is a worthy investment in the long term. with my dad living out there, im hoping he can keep the place running, sort out tenants which won'g give me much return (£100 a month maybe) but ill stick it straight in a bank and wa-la, ten years later i have 10k. to start on another house out there. thats the plan anyways.

dont think ill ever be able to afford anything in the uk, no one in my family owns a house out here, apart from my dad (who doesnt live here, hes just making money

your story is similar to a guy i used to go school with. he bought a flat young, and now he is 26 and owns 6 houses i think. and propertyy prices in the uk are booming.

[MeTurk]

i think id need to be renting a proper place (not council) before i took out a morgage on somewhere else.

I keep getting told I'm wasting time paying rent and would be better off paying off a mortgage, I'm seriously thinking about about buying a little old cottage in town that used to be where my grandfather worked as a tailor and where he meet my grandmother. It'll all depend on if I can get the house for the price I want, how much the (fairly big) renovations will cost and weather or not I can get planing permission to change the roof of the house. I'll be renting out the 2nd room to cover some of the cost of the mortgage.

and propertyy prices in the uk are booming.

Especially in N.Ireland now. All the property adds in the Republic are telling us it's time to invest up north.

[Canadian Bacon]

ahh the landlord... can't get any more bourgeoisie than that :D

[MeTurk]

Does that mean I have to start wearing a top hat and monocle?

[maracle]

If you guys invest in real estate, do you worry about being out of touch when traveling?

I've owned a duplex in Austin TX for a couple of years now, its working out well financially but I looked at a million places before I found this one...and it had sellers that needed to close fast because they were under contract on another house and needed their equity to close. So I got a decent deal. Its basically cash flow neutral, I don't make any extra cash but I get some tax benefits and appreciation from the house going up in value.

I'll admit I haven't put in much more work to build up my empire but I struggle to know if I could find another good property. And it seems like one bad choice on buying could easily wipe out a lot of good ones. And if I travel its kind of worrisome, my tenants are really easy but I'm worried about pipes bursting if I'm out of touch or something.

Anyway, I've thought about professional management but I'm guessing thats kind of expensive. I guess I should do more research.

[voyd]

Originally Posted by maracle

Its basically cash flow neutral, I don't make any extra cash but I get some tax benefits and appreciation from the house going up in value.

You see, Texas has a pretty flat housing market because land is so cheap and plentiful. And land scarcity is really what drives the values up - not the houses themselves.

Which is why I don't necessarily think real estate is all that great an investment in Texas (as opposed to the WC). As you say, at the end of the day when you offset your rental income with property tax and utilities, you may come out about even. Your main profit being tax deductions and slow appreciation.

And the additional downside is that you're now more tied down and can't travel as freely because you have to watch over your properties.

I think the real draw for real estate investing is high appreciation rates. If it's over a certain rate, then you can flip properties quickly without having to hang onto them too long. This minimizes your hassles and maximizes your quick profits. Using properties just for passive rental income can become an ongoing hassle and your net profit from that gets shrunk due to all the other costs involved.

[mooloo]

just curious, are there a number of cashflow positive properties in the states? i have been looking in nz for a year or so now for a rental but with the rising house prices and mortgage interest rates and relatively low rental prices i have yet to find anything that is cash flow positive.

I have looked online at some properties in canada and have found some that look like they could be cashflow positive.

As an accounting student i am all for finding a cashflow positive property which runs at a loss through the use of depreciation so i can get a refund on my taxes, have the tenants pay the mortgage (if the property appreciates lucky me, if not my mortgage will still be covered with none of my cash outlayed, other than the deposit for the house which i would find some magical way of getting back and not having to pay tax on it).

Also what are property management rates like over that side of the world, i think they base it on about 7% of the rental price each week here, so if they dont get tenants in they dont get paid.

I have seriously seriously considering a trip over to canada to purchase a few lowish cost rentals which i deam would be cashflow positive, the trip would of course be written off as an expense so that would reduce my tax bill!

so basically whats the situation like in the states, do u think i should consider looking there as well, and what are the property management fees like cas obviously i can't be heading over their to fix anything really, with the stupidly high cost of flights to your end of the world! (try 1800-3000$ return).

Also what are the tax laws regarding owning rental properties, i know they are different in each state/province, what kinds of refunds/rebates can you get for owning rentals etc?

That was long! :D

Cheers,

Amanda

[travelpunk]

Originally Posted by mooloo

just curious, are there a number of cashflow positive properties in the states? i have been looking in nz for a year or so now for a rental but with the rising house prices and mortgage interest rates and relatively low rental prices i have yet to find anything that is cash flow positive.

I have looked online at some properties in canada and have found some that look like they could be cashflow positive.

As an accounting student i am all for finding a cashflow positive property which runs at a loss through the use of depreciation so i can get a refund on my taxes, have the tenants pay the mortgage (if the property appreciates lucky me, if not my mortgage will still be covered with none of my cash outlayed, other than the deposit for the house which i would find some magical way of getting back and not having to pay tax on it).

Also what are property management rates like over that side of the world, i think they base it on about 7% of the rental price each week here, so if they dont get tenants in they dont get paid.

I have seriously seriously considering a trip over to canada to purchase a few lowish cost rentals which i deam would be cashflow positive, the trip would of course be written off as an expense so that would reduce my tax bill!

so basically whats the situation like in the states, do u think i should consider looking there as well, and what are the property management fees like cas obviously i can't be heading over their to fix anything really, with the stupidly high cost of flights to your end of the world! (try 1800-3000$ return).

Also what are the tax laws regarding owning rental properties, i know they are different in each state/province, what kinds of refunds/rebates can you get for owning rentals etc?

That was long! :D

Cheers,

Amanda

Sorry to just get to this.

To answer your question, there is cashflowing property everywhere...if you buy right.

There are homes in Detroit that can be bought for $25k and with a little TLC, you can rent and cashflow that sucker. Then again, it is Detroit. Not exactly a desired location that citizens are rushing to relocated to.

I believe that there are "don't wanters" everywhere and now there are tons of foreclosures that can be picked up at bargain prices, if you know what you are doing.

In some of the high value cities like Boston, San Francisco, Los Angeles, New York, San Diego, Seattle, etc...it is possible to find cash flowing properties as well, but will be more difficult as these values are outrageous.

By buying it right, I mean structuring your financing and or your offer to the seller so it can be a positive cashflowing property.

There are numurous books that will help you in creative financing and that knowledge is golden.

For property management fees, 10-11% seems to be normal for full service type management companies.

You can probably get friendly with a local real estate agent and ask them to contact you if they see anything that meets your criteria.

I think you're on the right track in looking to buy a property right. Creative real estate financing will be the key, after you find the right property from a motivated seller, that is.

I'd love to hear of your progress, so keep us updated !