24) Live on Twitter X: House Money Q&A

Real Estate Investing with House Money

House Money Podcast

In this week’s House Money Podcast, Tom and Alan host a Twitter Space. Alan talks about being in real estate for 20 years and it feels like every 6 months, he sees something he has never seen before. He learns that predicting the future is a fool’s errand. Tom also shares that when he was working with a client, he knew waiting was not a good idea so put in an offer. They didn’t win the deal he thinks because they weren’t taking both properties. Alan remarks on interest rates – a 30% interest rate can cash flow, while a 0% interest rate might not. According to him, it’s a good idea to get on the property ladder vs waiting. Tom and Alan briefly discuss flipping properties, which isn’t their favorite thing.

A listener (“Not Mike”) asks the hosts for tips for being a long-distance landlord and Tom shared that if you don’t have a team built up, your long-distance landlord journey will be much harder than it looks on paper. Another tip from Alan is to find a realtor in the town where you’re investing and go with the top realtor. A rock star realtor will know other rock stars. Alan likes hiring property managers with bad reviews, because that’s the tenants saying they stuck to their processes. “Not Mike” lives in Washington State, so they all discussed the option of investing away from there. Alan points out that property managers decrease the percent they take the more homes you buy and he tells his own long-distance investing story.

Jasmine answers the question: What can new investors do to make lenders’ lives easier?

A listener (“Sophia”) also asked a question on whether she would start on a single-family and try to find a way to rent out the rooms, push a little bit and get into a two-family, or go out of state since she was from Brooklyn, New York, which is an expensive market. They advise her to start with something that you own locally before jumping to upstate because the appreciation and rent increases in New York will be profitable.

Another listener asks if there will be a 20% to 30% collapse in prices and Alan doesn’t see that happening unless something happens across the whole economy. It will not just be real estate. Another real estate investor, Lawrence Briggs added that if her financial risk tolerance level is okay with pulling the trigger in buying a deal then he’s gonna buy it regardless. He doesn’t try to time the market.

Another listener asks if any of the hosts have experience with emerging market development and how to secure that type of financing. Specifically, he’s asking about a small town outside of Pittsburgh. Alan’s experience with small-town investing is that everyone who lives there and grew up in that town knows everyone. Being boots on the ground there is the best step. The local community banks are the ones that are most interested in making the small town survive.

Clint Murphy, a former Wealth Wednesday co-host of Tom (and Lauren) shares that when things are scary and dark in real estate, that’s the time it’s best to buy a property. He also continues to share his knowledge about real estate, which is valuable, since he’s the CFO of a real estate development company. Prices go up like a rocket but come down like a feather.

Listener (“Salvador”) also asks for recommendations about his idea of buying a duplex. Right now, he’s renting in Delaware. Alan suggests buying a duplex, house hacking it, and living in one unit and having tenants to help him cover his mortgage costs. Tom points out that some people seem to be overpaying for duplexes right now. Don’t forget that you can rent bedrooms out. Lawrence agrees with this.

Another listener (“Fatal Rattle?”) asks if most of the deals are structured through an LLC or if they’re buying in their name. This is a very common question we get at House Money Media. Alan thinks it’s better for new investors to do it in their names because it’s cheaper and you can max out your DTI (debt-to-income).

One of the Monopoly Bros, a Detroit investor, chimes in on some recent deals in that area. He says if you know a good deal, go all in. Maybe not flips, though, since he just lost $20k on a flip. He’s not trying to be doom and gloom, but real estate isn’t always rosy.

Sponsored by: Jasmine Mortgage Team https://www.jasminemortgageteam.com/

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