How to Buy a Home on a Shoestring

05/19/2023

Everyone knows buying real estate is a key foundation to financial freedom.

But most people are taught only about buying a single family home and different variations of that.

You can fix and flip, wholesale, BRRRR, sub-to, lease option, Airbnb, you name it.

These options are fine, except for one thing. Ok well two things.

Scale - When you flip or wholesale a house, you're looking at a $30k-$50k payday on a really good day. In multifamily deals go for over a quarter million dollars and the high end can easily see 7 figure profits from wholesaling.

Time - Your most important asset is your time. Residential deals are one door at a time. Apartments can be tens or hundreds of doors.

There are ways to leverage scale and time advantages through multifamily apartments and I can direct you to do the same.

If you're interested in rapidly growing your real estate portfolio, there is a free breakthrough strategy session.
Let me know if you are interested.

To your success,

D

05/16/2023

I wanted to share this story I heard and remind you how to reach your goal of buying a house on a shoe string.
He had only $67 dollars in his bank account, hoping for a life insurance sale to help catch him back up on everything.

The sale never came, but his girlfriend at the time spotted him a grand so he could pay his portion of the rent and put more gas in the car.

"I know you're good for it, just pay me back later."

It was a gut wrenching time in his life. He reluctantly accepted, embarrassed for not being able to stand on his own two feet and be a man, a provider.

But after that episode, he learned how to budget.

Not just some sloppy back of the napkin estimate of what he made and what he spent, hetook it seriously. I think this skill is missing from most people who are struggling check to check the way he was over a decade ago. These habits were the foundation of financial stability you need in order to get to financial freedom.

So hopefully this will help you in some way:

Track your income - it's pretty straightforward if you're on a 9-5 with a salary, or regularly hour pay schedule working 40 hours a week. This is how much you have to live your life.

Track your expenses- If you're very committed to figuring your life out, I'd go back over my last 12 credit card and bank statements and categorize every expense. Then separate them into mandatory (rent, mortgage, car, groceries, cell phone, etc) and luxury (going out money, restaurants, Amazon purchases, subscriptions, cable programs, etc.) items.

Take your mandatory expenses out of your income, that's your net take home pay. If you're upside down at this point, you need a better job, a second job, or to decrease your lifestyle.

Save an emergency fund of $1000 from your net take home pay.

Now you pay down outstanding debts that are over 5% interest. Usually credit cards are the first culprit that needs to be taken care of as they have the highest interest rates.

Once you're debt free, now you can start investing. If you're not savvy enough to do real estate just yet or if you have no intentions of doing it, you should just pay into a Roth IRA which can be funded up to 7k per year and then increase your contributions to your 401k. While these are way inferior ways to invest compared to real estate, it's better than doing nothing and far better than just saving in a bank account.

After you've paid yourself first, now you can tack on your luxury items.

08/18/2021

The market has begun to shift. We are starting to see price cuts, especially in the investor only space. If you can wait, you may be able to get a deal. If you do not want to be among those who over paid, all be it at a low interest rate, patience is a good virtue to have.

05/19/2019

07/27/2018

Retire on $500,000 in NYC? An Advisor Says it's Possible

JULY 26, 2018 • JERILYN KLEIN BIER Financial Advisor magazine is doing a series on what advisors say it costs to retire in many locations. Anyone who has spent a day in New York City knows how quickly its high prices and enticing venues can burn holes in pockets. Its cost of living is at least 68.8 percent higher than the national average and more than double the national average for those residing in Manhattan, according to SmartAsset. But retiring comfortably in the Big Apple can be doable for many people as long as they have a plan and understand how to live within their means, said Justin Winters, a CFP and a member of the wealth management group at midtown Manhattan-based Treasury Partners, the largest independent team within HighTower Advisors. “We’ve seen clients who live on Social Security and a pension and they never actually touch their portfolio at all,” he said, noting that a rent stabilized two-bedroom apartment in the city can cost a couple of thousand dollars a month. A couple retiring with a salary of $100,000 could collect $3,500 a month net in Social Security (this figure can be impacted by many variables) and maybe $2,000 to 4,000 a month from a pension, said Winters. Many retired New York City public employees (including teachers, police and firefighters) still receive traditional pensions, he said. “On the other hand, you can have someone living in a three-bedroom apartment costing $13,000 a month and they spend $10,000 a month on life,” he said, including food, health care, entertainment, household items, travel and “a $100,000 summer rental.” In this case, “You probably need a portfolio in the $10 million range if you really want to maintain your assets,” he said -- or $6 million to $7 million if leaving money to your kids isn’t a concern. Let’s say a retired New York City couple without a pension collects $3,500 a month in Social Security and withdraws $2,000 a month from their $500,000 nest egg. The $2,000 should cover food, health care (after Medicare) and entertainment, said Winters, and this conservative drawdown can provide a cushion and might leave some inheritance for their kids. If their nest egg earns 3 percent a year net of fees, it should last 33 years and if it earns 4 percent net, 45 years, he said. This couple would need to have a rent-stabilized apartment or already own an apartment, he said. According to Rent Jungle, the average monthly market rate for New York City apartments in June was $3,585. “Having a car in New York is a luxury,” added Winters, a Manhattan resident who rents one when needed. A garage parking space typically costs hundreds to rent each month or may have a six-figure price tag. Combined city and state income taxes are also high (10 percent to 11 percent). For individuals receiving Form 1099 compensation, which doesn’t withhold income tax, “You really have to move money to the side, out of their world,” he said, “so they don’t think that they have that extra money to spend.”

06/23/2018

Fannie Mae, is making a way for student loan borrowers and their co-signers in three ways; it is expanding its cash-out mortgage refinance option, which lets you trade high-rate student loans for lower-rate home mortgage. borrowers applying for a mortgage may now exclude debt being paid by others — examples are, credit cards or student loans being paid off by a parent or an employer — from their applications. That helps give them a better debt-to-income ratio. And, another change helps student borrowers who are on flexible payment programs, which tie monthly loan payments to a borrower’s income.

06/07/2018

Helping People one house at a time.