Current Events > Why aren't you guys investing into real estate?

(+) Yeah! (+)

averagejoel posted...

because I'm not wealthy

also I don't want to make money by exploiting people

Are people who own apartment buildings doing that too?

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Austin_Era_II posted...

You mean shares. Cause if you wanna buy a company you need the entire funds upfront compared to a house cause you get a mortgage.

Yes, shares. Doesn't change the argument.

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So lets say I put $20K down on a home worth $250,000 today as an example. 20-30 years from now lets say that house is now worth $600K (I'm just making up these numbers). If the home is mortgage free or close to you gained about $500,000 not counting in taxes after you sell and real estate agent's cost.

If I put $20K in some stocks/shares where do you think it would be 20-30 years from now? I'm asking cause I don't know much about shares/stocks yet...

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Austin_Era_II posted...

So lets say I put $20K down on a home worth $250,000 today as an example. 20-30 years from now lets say that house is now worth $600K (I'm just making up these numbers). If the home is mortgage free or close to you gained about $500,000 not counting in taxes after you sell and real estate agent's cost.

If I put $20K in some stocks/shares where do you think it would be 20-30 years from now? I'm asking cause I don't know much about shares/stocks yet...

Assuming you put in the same amount of money $250k over 20 years, you'll end up with $859,078.70 assuming average 10% returns.

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Well Austin I'm guessing is saying a renter is paying those payments not him
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emblem boy posted...

Well Austin I'm guessing is saying a renter is paying those payments not him

Exactly...my point! You can't buy an entire company with like $20K or $30K, etc. So buy a 2nd house as leverage. While also investing in stocks.

If you got $250K as a lump sum say from your grandparents by chance then I'd look into either splitting that money to possibly get 2 or 3 decent homes to rent or invest the entire $250K in different stocks. See what gives me the better outcome in 20-30 years. Of course in terms of real estate it takes longer to take out the money like if you wanted to sell the house compared to moving money electronically back into your bank account.

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Austin_Era_II posted...

Are people who own apartment buildings doing that too?

yes

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Austin_Era_II posted...

Exactly...my point! You can't buy an entire company with like $20K or $30K, etc. So buy a 2nd house as leverage. While also investing in stocks.

If you got $250K as a lump sum say from your grandparents by chance then I'd look into either splitting that money to possibly get 2 or 3 decent homes to rent or invest the entire $250K in different stocks. See what gives me the better outcome in 20-30 years. Of course in terms of real estate it takes longer to take out the money like if you wanted to sell the house compared to moving money electronically back into your bank account.

Mortgaging two houses is just asking for trouble. What are you going to do if you can't find renters and $500k in debt while accruing interest?

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Squall28 posted...

Mortgaging two houses is just asking for trouble. What are you going to do if you can't find renters and $500k in debt while accruing interest?

Don't buy in a very small ass town. Do some research...call up a real estate agent. Look on Kijiji if there are people looking in that area. See what the going rate is. Make sure you have one to two months worth of funds set aside in the event it takes you a month or two to land a tenant. Generally if there is a demand in most busy areas you won't have an issue finding a tenant unless the place you got is trashy. You get what you paid for.

Make sure the tenant has a legit job letter, call the employer, get pay stubs, credit history. Take a security deposit to cover at least one month worth of rent incase they don't pay and start the eviction process. In 2021 if this pandemic is a lot better eviction process typically takes 1-3 months I believe. Use that security fund also if they damage stuff. Along with security deposit get first and last. And if you want get a criminal background check. Talk with a lawyer about the laws in your area if you need to evict. Worst case just like starting a small business put the place up for sale.

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You could also pay a management company about $100/month to manage the property, screen tenants, be contact for them, schedule repairs, etc. Much more manageable to outsource the work.

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Exactly.

Buy a house in your price range. Then save up and get a 2nd place to rent. Handling tenants and property maintenance isn't hard especially if the place is in decent shape. Tenants can handling cutting the grass. A few people I know make their tenants do it. If your mortgage is done in 20 years or less then hire a property management company and u can sit back and relax. Also with a decent down payment on a 2nd house if you can get a 30 year mortgage your rent should bring in an extra $200 or more in passive income. Take that extra $200 and put it in stocks (retirement fund). Keep growing your money. And this keeps you in the lower tax bracket.

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TC your Canadian? You from Ontario

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Want to homeflip? I could give you a few cities in Massachusetts where it would make you $$$$.
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apocalyptic_4 posted...

TC your Canadian? You from Ontario

Yeah. Grew up in Toronto. Moved away 7 years ago.

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