买房出租的六个误区(ZT)

zzhan

引用第8楼伏龙居于2011-10-05 20:54发表的 回 7楼(游客) 的帖子 :
The purchase of the property is only one link in the whole rental management process, though an important one and very much the starting one, but the daily & monthly management is far more important for the investor with long-term view than the purchase alone.

Also, the success in rental business is different from a good purchase, since even when the purchase price was a little high you may still get good results when the rental business is done successfully....

Well said. Agreed with you that good management is important to successful rental business.

But going back to the 2% return rate, purchase price is as important as management, if not more, in the return rate calculation. From my experience, rentals I acquired this year can reach that threshold, but not the ones last year, let alone the year prior to that (2007-2009). No matter how good you are on your management, if you bought prior to 2010/2011, 2% is very, very difficult to achieve, if not impossible.

One caveat is that the lower your purchase price, the easier you can reach the 2%. For example, if you buy a property for 17K and spend about 10K to fix it for the total cost of less than 30K, 600 monthly rent is still very realistic. A real example is this: http://www.atlanta168.com/forum/read.php?tid=8560 (total cost < 40K, can rent for 850 ). But from your price range of 50K house rent for 1000, I don't see how you can achieve 2% in 2007-2009 market.

The key to success in rental buz is not 2% or 1%. It is your have net income after cost and you do not spent too much time to deal with bad customers. You need your own life other than chase 2% and the payment of those customers. Too high return is a sign on the bad area and bad customers.

引用第7楼游客于2011-10-05 16:46发表的  :
I know a friend who rent $1000 for less than $50K purchase in several of his rentals. However, I would say he spent at least $15K to fix them, which does not even include his own labor. The tenants he got for his rentals are also below average because he does not do any screening. As long as someone who could give him first month rent plus one month security deposit, he will rent them. So he spent a lot of time chasing the rent every month. He has already done eviction several times.  

So If you don't consider your own labor and time worth anything, I think 2% is definitely workable.  

You are changing bases for the computation. The rental rate should be based on your total investment, not what you paid for purchase only. Fixing it up may cost a lot too. Your own labor has to be counted. I do not do any repair myself and count all costs.

tonyca

I totally agree with you.
Here is what I see from CNBC regarding to Steve Jobshttp://www.cnbc.com/id/43479628/?slide=12)

Jobs is famously known for his affection for The Beatles. In fact, when asked about his business model by television news magazine "60 Minutes," he replied: "My model for business is The Beatles. They were four guys that kept each other's negative tendencies in check. They balanced each other. And the total was greater than the sum of the parts. Great things in business are not done by one person, they are done by a team of people."

So why not delegate the management part to a professional and save time to find more money and deals? That's my 2 cents.

rocky

文章里说的1%啦、2%啦都是毛利润吧。
即使不用再花钱去fix,租客也及时付房租，
扣掉物业税、保险、保修、income tax，再算算，回报率就少的可怜啦。
一句话，我们拿自己的血汗辛苦钱，说是投资赚钱，其实就是在为美国经济做贡献。
没有我们的投资，房子烂掉，穷人没地方住，IRS、保险公司、county收不到钱。
所以各位投资房产的兄弟们，大家都是好样的~~~~ o(∩_∩)o

zzhan

引用第11楼游客于2011-10-06 07:17发表的 回 楼主(zzhan) 的帖子 :
The key to success in rental buz is not 2% or 1%. It is your have net income after cost and you do not spent too much time to deal with bad customers. You need your own life other than chase 2% and the payment of those customers. Too high return is a sign on the bad area and bad customers.

Generally speaking, you are right that high return means more works and hassels. People in rental also has different level of threshold of tolerance, which come with experience. It is all about trade off. As saying goes, "no pain, no gain".

Finding the right tenant, even in the so-called bad areas, can help eliminate some headache.

zzhan

引用第14楼rocky于2011-10-06 12:26发表的  :
文章里说的1%啦、2%啦都是毛利润吧。
即使不用再花钱去fix,租客也及时付房租，
扣掉物业税、保险、保修、income tax，再算算，回报率就少的可怜啦。
一句话，我们拿自己的血汗辛苦钱，说是投资赚钱，其实就是在为美国经济做贡献。
没有我们的投资，房子烂掉，穷人没地方住，IRS、保险公司、county收不到钱。
.......

还是这个说的好. ding!

伏龙居

引用第10楼zzhan于2011-10-05 22:36发表的 Re:回 7楼(游客) 的帖子 :


Well said. Agreed with you that good management is important to successful rental business.

But going back to the 2% return rate, purchase price is as important as management, if not more, in the return rate calculation. From my experience, rentals I acquired this year can reach that threshold, but not the ones last year, let alone the year prior to that (2007-2009). No matter how good you are on your management, if you bought prior to 2010/2011, 2% is very, very difficult to achieve, if not impossible.
.......

Yes, you are correct on this, the original purchase price is important, no doubt about that.

Other comments are valuable too, that the 2% is only the gross income target not net, and that whether it is 2% or 1% that's not the ultimate goal for this businees, we Chinese believe in the holistic approach and results that will take into consideration of a multitude of factors all together, such as our time involvement and the peace of mind when going to bed.

Hard work aside, afterall we are in this to help elevate the quality of our lives, not just for the profits and especially not to make our lives miserable in exchange for the profits, even if it is more 2%! But do work harder when you can.

Stock market is the place you money should go.  Someone here got 1% return daily.  That will be 3000% annual return for 200 days.

引用第18楼游客于2011-10-07 13:56发表的  :
Stock market is the place you money should go.  Someone here got 1% return daily.  That will be 3000% annual return for 200 days.

Yeh, right. Somebody really got that much. It is really like a lottory. Many more lost their pants.