/biz/ - Business & Finance

>>568126

Join up with others and pool your funds?

>>568126
You can't invest in property with that little money. 20 percent down plus commissions plus getting it ready to rent is a lot more than 10k.

A good rule of thumb is all expenses before the mortgage is 45 percent of rent.

You can buy shares in a REIT.

Investing in real estate and properties have great returns, but you need to make a pretty big investment to begin with.

I know several people who've made killings in real estate investments, but they're all older dudes who had 100k+ a year salaries to begin with.

>>568138
That's the thing i never understood, unless these people had saved up for several years and then invested a lump sum

>>568126
>They all seem to make their money in rental properties and properties in general.

Real estate wealth is often an incomplete picture. Two examples:

1. I own 3 rental properties. How'd they get off the ground? Directly through money earned in my outside career. Some of my friends think I'm doing well because of the houses but in actuality they're not much better than an index fund (when taking into account the value of my time). They're simply more visible.

2. Middle class people fall for this one all the time: "Your home is your best investment!" Far from it. More like a forced savings plan that tracks inflation but also eats through money.

>They all seem to make their money in rental properties and properties in general.
Lol no.

>My question is - how do you invest in property if you have say 1k, 5k or 10k?
Buy REIT ETFs like VNQ:
https://personal.vanguard.com/us/funds/snapshot?FundId=0986&FundIntExt=INT#tab=0

>>568174
Think of it this way. My parents took out a 6yr loan to buy a new car. A Mazda 3. Now imagine instead they saved for 6yrs for a down payment on their rental real estate.

>>568156
>they're all older dudes who had 100k+ a year salaries to begin with.
The old rich get richer saying.

>>568187
>they're not much better than an index fund
Exactly. Why even bother? Unless you have a lot of free time. Might be a good thing for early retirement.

>>568126
Buy a cheaper place in an area you know will grow over the coming years. use rental income and work income to pay down on an interest only loan. Use equity to another house, repeat.
If you can spend some $ on improving the house like adding aircon, paint the walls, carpet you can increase rent, have a lower Tennant turn over period as well.
Not sure what country you are from but you can take advantage of negative gearing and other tax benefits.
Once paid off you have a house that has grown in value, can sell it whenever or use the rental income for other investments.

>>568194
>>568143
Does it make sense to own a REIT in a taxable account instead of a IRA?

>>568126

Keep saving, buy house in area that will appreciate and you don't mind being for a while and rent out a room so you have some other faggot paying your mortgage while you live for free. Meanwhile you are putting all your other savings in the market so you can buy more property. Rinse and repeat.

>>568200
>Exactly. Why even bother? Unless you have a lot of free time. Might be a good thing for early retirement.

True. I'm in Central Florida so they've cash flowed and appreciated nicely since I bought in 2012-2013. If I lived in the northeast or California I'd never have considered rentals.

>>568187
>>568200
>>568228
Bought the first one April of 2012. I'll concede it was more luck than skill.

>>568217
>Does it make sense to own a REIT in a taxable account instead of a IRA?
Yes, if the investment fits your allocation and risk strategy. While you would prefer to have a REIT in a tax-advantaged account, you shouldn't avoid a good taxable investment unless the incremental taxes are actually higher than the expected return (a highly unusual situation for most).

has anyone ever bought a duplex, renting out half and living in the other? I'm interested in the idea, and it seems like a good way to have most of ones mortgage paid for. Instead of paying rent, that money can go to your savings.

>>568382
My ex does this - it's working out for her. Big advantage being the property manager.

>>568138

You are retarded. Nobody who makes money in real estate or getting mortgages.

>>568406

is*

>>568187
welp this is well stated. Let's be clear that the best path to riches is through the stock market. The returns over the past 70 years don't lie

>>568126
>They all seem to make their money in rental properties and properties in general.
have you been reading some get rich quick book

>>568404
any insight in her situation you care to share? did she have enough for a downpayment, how often does she have no one renting etc.

>>568410

It's true that every billionaire made their riches in Finance. Some started their own companies, but most were venture capitalists, fund managers, etc. I don't know where OP got his information from, but rental property is a money pit, unless you own a large complex. Renting out a house or two isn't going to make you money. You need 100s of units.

>>568443
And that's where they are - but a lot seem to start out with nothing (working a shitty job) and saving enough to make that one primordial investment.

I want to know what that is/

>>568126
>So I've noticed a trend in the rags-to-riches type people. They all seem to make their money in rental properties and properties in general.

So YOU'RE the idiot that those "testimonials" are talking to when they are posed on a yacht and told to say "I used to be in debt up to my ears, but then I discovered mr slick's 'guide to flipping real estate', and now my rich beyond my wildest dreams!!"

People are quite selfish and will do just about anything to reinforce their convictions.

Investing in stocks is much more feasible for most guys here. Investing in RE isn't. Naturally they'll go to great lengths to prove that the former is far superior to the latter.

Reality is much more diverse than that.

>>569250
He actually believes this too. He doesn't notice the other 10 million retards who bought property and got fucked.

>>568459

Alot of them founded a tech company in dot com bubble.

>>568126
Ita not just a rags to riches trend 90% or more of millionaires had real estate dealings that conyributed. Also dont ask /biz/ ask "biggerpockets"

>They all seem to make their money in rental properties and properties in general

That's because mortgages are an amazing vehicle for leveraging. Effectively having good credit creates a second income for you.

>10k

You can finance a rental property. At that point your initial 10k investment is earning something like 60-70% annually in equity when you use the rent to directly make mortgage payments or keep the home in good repair.

If you don't write off your taxes properly though you'll get fucked by the IRS. You have to deduct your rent income via mortgage payments, but the IRS explains how to do this online. Don't know why people hate them so much, the USFG is pretty cooperative.

ok niggers

>>568382
My neighbour's do this.

They don't like it when they have freaky loud sec and in the morning come over and ask for the rent money.
They feel it's too awkward but are happy because they can make sure tenants don't ufck up their place

You flipping morons, your words are poison, have no value and fact information at all. What is the longterm ROI you might be able to achieve? Are you aware of management services fees, growing expenses, and so on... in the end, when having a choice to invest in rental properties or in finance, I'll always go for finance, to say so, I'm renting out commercial properties since 1990s, it was my only source of income for years, five years ago, after five years of seminars, studies, backtesting and so I've changed the allocation of my assets, sold some of the properties and slowly started to investing on CBOT and NYMEX, results are overwhelming. Fuck rental properties. Now I pay lower taxes, make more money, have more free time to spend with my family, fuck rental properties.

>>571109

Why do you hate rental properties so much? Dealing with tenants? Sure you're making more money now, but for those who are into real estate rental and leasing as one of their main interests and actually likes to do it, it is surely a good way to get passive income is it not?