Tough call in Murrieta

[surveyor]

indiana out-of-state investing

According to my information and research, Indiana real estate (and the whole area around it) appreciation tends to lag inflation and as such underperforms as an appreciating asset. However, the area does cash flow well.

In terms of the stock market, Indiana real estate performs like a bond fund. Slow, and sometimes lags inflation.

HLS does have a point. In terms of real estate, why plop down your entire money lump into one property, when you can diversify and put it over several properties? It also makes sense from a tax standpoint because you can probably decrease your taxes more with several properties (using depreciation) than one.

All I can say is to do the hard math and see which performs better.

[RatherOpinionated]

“When each of them graduate I would turn over the deed to the property and they could use the income to pay off their student loans.”

So this means you would encumber them with properties and turn them into landlords half way across the country. What if they want to focus on their careers after spending all that time studying and now playing landlord to a home in Indiana. What if there is a vacancy, who pays the mortgage? If it goes negative will they go further into debt?

If I were a fresh graduate I don’t think I’d want to deal with a property barely spinning off any cash flow half way across the country. I’d rather focus on work and pay off my own loans.

Heck, if I were them I would just SELL it since you gave them the deed, and use the proceeds to pay off the loans faster.

Buy the home in Murrieta, and start focusing on saving for college and retirement. Or tell your kids now they are on their own for college and get them to start saving!

[img_assist|nid=5758|title=|desc=|link=node|align=left|width=419|height=500]

[RatherOpinionated]

“When each of them graduate I would turn over the deed to the property and they could use the income to pay off their student loans.”

So this means you would encumber them with properties and turn them into landlords half way across the country. What if they want to focus on their careers after spending all that time studying and now playing landlord to a home in Indiana. What if there is a vacancy, who pays the mortgage? If it goes negative will they go further into debt?

If I were a fresh graduate I don’t think I’d want to deal with a property barely spinning off any cash flow half way across the country. I’d rather focus on work and pay off my own loans.

Heck, if I were them I would just SELL it since you gave them the deed, and use the proceeds to pay off the loans faster.

Buy the home in Murrieta, and start focusing on saving for college and retirement. Or tell your kids now they are on their own for college and get them to start saving!

[img_assist|nid=5758|title=|desc=|link=node|align=left|width=419|height=500]

[RatherOpinionated]

“When each of them graduate I would turn over the deed to the property and they could use the income to pay off their student loans.”

So this means you would encumber them with properties and turn them into landlords half way across the country. What if they want to focus on their careers after spending all that time studying and now playing landlord to a home in Indiana. What if there is a vacancy, who pays the mortgage? If it goes negative will they go further into debt?

If I were a fresh graduate I don’t think I’d want to deal with a property barely spinning off any cash flow half way across the country. I’d rather focus on work and pay off my own loans.

Heck, if I were them I would just SELL it since you gave them the deed, and use the proceeds to pay off the loans faster.

Buy the home in Murrieta, and start focusing on saving for college and retirement. Or tell your kids now they are on their own for college and get them to start saving!

[img_assist|nid=5758|title=|desc=|link=node|align=left|width=419|height=500]

[RatherOpinionated]

“When each of them graduate I would turn over the deed to the property and they could use the income to pay off their student loans.”

So this means you would encumber them with properties and turn them into landlords half way across the country. What if they want to focus on their careers after spending all that time studying and now playing landlord to a home in Indiana. What if there is a vacancy, who pays the mortgage? If it goes negative will they go further into debt?

If I were a fresh graduate I don’t think I’d want to deal with a property barely spinning off any cash flow half way across the country. I’d rather focus on work and pay off my own loans.

Heck, if I were them I would just SELL it since you gave them the deed, and use the proceeds to pay off the loans faster.

Buy the home in Murrieta, and start focusing on saving for college and retirement. Or tell your kids now they are on their own for college and get them to start saving!

[img_assist|nid=5758|title=|desc=|link=node|align=left|width=419|height=500]

[RatherOpinionated]

“When each of them graduate I would turn over the deed to the property and they could use the income to pay off their student loans.”

So this means you would encumber them with properties and turn them into landlords half way across the country. What if they want to focus on their careers after spending all that time studying and now playing landlord to a home in Indiana. What if there is a vacancy, who pays the mortgage? If it goes negative will they go further into debt?

If I were a fresh graduate I don’t think I’d want to deal with a property barely spinning off any cash flow half way across the country. I’d rather focus on work and pay off my own loans.

Heck, if I were them I would just SELL it since you gave them the deed, and use the proceeds to pay off the loans faster.

Buy the home in Murrieta, and start focusing on saving for college and retirement. Or tell your kids now they are on their own for college and get them to start saving!

[img_assist|nid=5758|title=|desc=|link=node|align=left|width=419|height=500]

[HLS]

Depreciation is good, but has to be recaptured eventually. You can defer it for a very long time by trading up using 1031 exchanges, but IMO that is a bonus to buying rental property, and should not be part of the equation.

Simple math, net projected REALISTIC income, WITH a vacancy factor needs to be done.
Lenders usually only allow 75% of rental income to allow for vacancy,maintenance,utilities, etc.

If someone already has their primary residence in place and financed well, paying cash for rental property in a “midwest sleepy farm town” would still be a foolish thing to do IMO, but better than blowing it on something that would never return anything.

There are many people that have made money from real estate (and stocks)that made foolish choices by conventional standards when they bought, but still did well. Was that luck or a skill ??

This will always happen. There are people buying today that may or may not be as lucky.

[HLS]

Depreciation is good, but has to be recaptured eventually. You can defer it for a very long time by trading up using 1031 exchanges, but IMO that is a bonus to buying rental property, and should not be part of the equation.

Simple math, net projected REALISTIC income, WITH a vacancy factor needs to be done.
Lenders usually only allow 75% of rental income to allow for vacancy,maintenance,utilities, etc.

If someone already has their primary residence in place and financed well, paying cash for rental property in a “midwest sleepy farm town” would still be a foolish thing to do IMO, but better than blowing it on something that would never return anything.

There are many people that have made money from real estate (and stocks)that made foolish choices by conventional standards when they bought, but still did well. Was that luck or a skill ??

This will always happen. There are people buying today that may or may not be as lucky.

[HLS]

Depreciation is good, but has to be recaptured eventually. You can defer it for a very long time by trading up using 1031 exchanges, but IMO that is a bonus to buying rental property, and should not be part of the equation.

Simple math, net projected REALISTIC income, WITH a vacancy factor needs to be done.
Lenders usually only allow 75% of rental income to allow for vacancy,maintenance,utilities, etc.

If someone already has their primary residence in place and financed well, paying cash for rental property in a “midwest sleepy farm town” would still be a foolish thing to do IMO, but better than blowing it on something that would never return anything.

There are many people that have made money from real estate (and stocks)that made foolish choices by conventional standards when they bought, but still did well. Was that luck or a skill ??

This will always happen. There are people buying today that may or may not be as lucky.

[HLS]

Depreciation is good, but has to be recaptured eventually. You can defer it for a very long time by trading up using 1031 exchanges, but IMO that is a bonus to buying rental property, and should not be part of the equation.

Simple math, net projected REALISTIC income, WITH a vacancy factor needs to be done.
Lenders usually only allow 75% of rental income to allow for vacancy,maintenance,utilities, etc.

If someone already has their primary residence in place and financed well, paying cash for rental property in a “midwest sleepy farm town” would still be a foolish thing to do IMO, but better than blowing it on something that would never return anything.

There are many people that have made money from real estate (and stocks)that made foolish choices by conventional standards when they bought, but still did well. Was that luck or a skill ??

This will always happen. There are people buying today that may or may not be as lucky.

[HLS]

Depreciation is good, but has to be recaptured eventually. You can defer it for a very long time by trading up using 1031 exchanges, but IMO that is a bonus to buying rental property, and should not be part of the equation.

Simple math, net projected REALISTIC income, WITH a vacancy factor needs to be done.
Lenders usually only allow 75% of rental income to allow for vacancy,maintenance,utilities, etc.

If someone already has their primary residence in place and financed well, paying cash for rental property in a “midwest sleepy farm town” would still be a foolish thing to do IMO, but better than blowing it on something that would never return anything.

There are many people that have made money from real estate (and stocks)that made foolish choices by conventional standards when they bought, but still did well. Was that luck or a skill ??

This will always happen. There are people buying today that may or may not be as lucky.

[pizzaman]

Bluefins
I’m sure you are aware of this but that house on Whitaker doesn’t really have 1/3 acre that is usable. A good portion of the lot is on the creek side of the back yard fence. Still its one of the premium lots in the development. If lot size is important you might consider this one. http://www.redfin.com/stingray/do/printable-listing?listing-id=1233233
Although the house is less sq footage the lot is all usable and it has access to the park next door. You probably remember that it was one of the models. Currently its a short sale but I’m sure the bank will have it back soon enough.

HLS
Can you leave some contact info I may be in the market for a mortgage soon.

[pizzaman]

Bluefins
I’m sure you are aware of this but that house on Whitaker doesn’t really have 1/3 acre that is usable. A good portion of the lot is on the creek side of the back yard fence. Still its one of the premium lots in the development. If lot size is important you might consider this one. http://www.redfin.com/stingray/do/printable-listing?listing-id=1233233
Although the house is less sq footage the lot is all usable and it has access to the park next door. You probably remember that it was one of the models. Currently its a short sale but I’m sure the bank will have it back soon enough.

HLS
Can you leave some contact info I may be in the market for a mortgage soon.

[pizzaman]

Bluefins
I’m sure you are aware of this but that house on Whitaker doesn’t really have 1/3 acre that is usable. A good portion of the lot is on the creek side of the back yard fence. Still its one of the premium lots in the development. If lot size is important you might consider this one. http://www.redfin.com/stingray/do/printable-listing?listing-id=1233233
Although the house is less sq footage the lot is all usable and it has access to the park next door. You probably remember that it was one of the models. Currently its a short sale but I’m sure the bank will have it back soon enough.

HLS
Can you leave some contact info I may be in the market for a mortgage soon.

[pizzaman]

Bluefins
I’m sure you are aware of this but that house on Whitaker doesn’t really have 1/3 acre that is usable. A good portion of the lot is on the creek side of the back yard fence. Still its one of the premium lots in the development. If lot size is important you might consider this one. http://www.redfin.com/stingray/do/printable-listing?listing-id=1233233
Although the house is less sq footage the lot is all usable and it has access to the park next door. You probably remember that it was one of the models. Currently its a short sale but I’m sure the bank will have it back soon enough.

HLS
Can you leave some contact info I may be in the market for a mortgage soon.

[Author]

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