Does anyone have experience in this? I've had two rental properties and am now down to one. They can suck the life out of you but now that I have had time to step back and look at the business behind it rather than the headaches and growing pains that come with it, I'm starting to get a little excited about it again.
Background: When I moved to Ohio in 2006, I couldn't sell my house in Michigan so I rented it out and pretty much broke even. I hated my job in Ohio, so I started looking around for other ways to make money. I got caught up in the TV shows that made it look easy to flip houses. I ended up buying a house to flip but I fucked up and bought right as the market started to tank. Since the market took a shit, I couldn't sell it, so I had to rent it out. Have had to do a lot of work, lose money every year on it ($400 if it is occupied all year and no repairs needed), get disgusted by the tenants that live like pigs and was pretty much ready to burn the place down. But things have changed......I sold my Michigan rental last year and made a nice chunk of money. I've got my Ohio rental in such good shape that I don' know what I would upgrade even if I had money to do so, so I've been looking at the financials of it, and this thing could end up paying off nicely if I can get the principal lowered and refinance it. The problem I had is that I paid too much because I bought at the wrong time. If I would have bought the place now instead of in early 2007, I'd have a totally different view of things.
Now: I have a different perspective now that the tough part of the experience is behind me. The big realization is that the (1) banks are making a killing off investors because they charge high interest rates for rental properties (higher risk) and (2) the market is primed to be taken advantage of. For example, I'm charging $925 a month rent for a house that could be purchased for $75k or less. For $60k, you could buy a place outright, put $10k or so into it and rent it for somewhere near that $925 number. Realistically, you could recoup the initial investment in less than a decade.
Anyways, I am thinking about turning my IRA into a self-directed IRA that invests in a property, but I am thinking about trying to get some family members or friends in to the fold. Has anyone ever turned their IRA into a self-directed IRA (I know that's how Jack did it)? Anyone ever partnered with anyone on an investment like this? I have heard about Real Estate Investment Clubs, but I don't think that is a safe route to go.
Thoughts?
Background: When I moved to Ohio in 2006, I couldn't sell my house in Michigan so I rented it out and pretty much broke even. I hated my job in Ohio, so I started looking around for other ways to make money. I got caught up in the TV shows that made it look easy to flip houses. I ended up buying a house to flip but I fucked up and bought right as the market started to tank. Since the market took a shit, I couldn't sell it, so I had to rent it out. Have had to do a lot of work, lose money every year on it ($400 if it is occupied all year and no repairs needed), get disgusted by the tenants that live like pigs and was pretty much ready to burn the place down. But things have changed......I sold my Michigan rental last year and made a nice chunk of money. I've got my Ohio rental in such good shape that I don' know what I would upgrade even if I had money to do so, so I've been looking at the financials of it, and this thing could end up paying off nicely if I can get the principal lowered and refinance it. The problem I had is that I paid too much because I bought at the wrong time. If I would have bought the place now instead of in early 2007, I'd have a totally different view of things.
Now: I have a different perspective now that the tough part of the experience is behind me. The big realization is that the (1) banks are making a killing off investors because they charge high interest rates for rental properties (higher risk) and (2) the market is primed to be taken advantage of. For example, I'm charging $925 a month rent for a house that could be purchased for $75k or less. For $60k, you could buy a place outright, put $10k or so into it and rent it for somewhere near that $925 number. Realistically, you could recoup the initial investment in less than a decade.
Anyways, I am thinking about turning my IRA into a self-directed IRA that invests in a property, but I am thinking about trying to get some family members or friends in to the fold. Has anyone ever turned their IRA into a self-directed IRA (I know that's how Jack did it)? Anyone ever partnered with anyone on an investment like this? I have heard about Real Estate Investment Clubs, but I don't think that is a safe route to go.
Thoughts?
