Positive Cash Flow - Pls Respond to Group With Ideas

[solidoakreturns]

Hey REIN Team,

So I was thinking that buying all these properties is obviosly a great idea. They will appreciate and in 5-7 years we will all have a ton of equity. Woo Hoo.

In the mean time I know I am definitely interested in some passive income. i.e positive cash flow properties.

Please resond all and add you ideas to the list. Lets brainstorm. Do not critize or debate any idea. Just respond all with another idea. First you grow a massive list then discuss.

Here we go:
1) Put more money down
2) Depreciate your property to pay less tax right now on your positive cashflow
3) Use the property analyzer issued by REIN (thank you Don - that is a great tool)
4)





2

 

[markl]

4) Buy in areas where you can achieve both. They are out there

 

[RedlineBrett]

1) Put more money down
2) Depreciate your property to pay less tax right now on your positive cashflow
3) Use the property analyzer issued by REIN (thank you Don - that is a great tool)
4) Use loans with longer amortizations
5) `suite` your property for extra income streams, rent out the garages seperately
6) Market the property as a `rent to own` and ask for a higher payment in exchange for a slight break on price at the end of the term and/or use the tenant/buyer`s larger security deposit to enhance your cash flow
7) depending on location, try for a furnished rental. these are higher cap costs and typically have much higher turnover but you can ask a higher rate
8) Negotiate a short term vendor take back until rents increase in your area - ask for anything: interest only payments, no payments AT ALL, flat rate of $100/ month etc. Sellers are giving deals right now.

That`s all I can think of right off the top of my head

 

[RussellWestcott]

Howdy. make sure you are at the next Ontario REIN™ members meeting (Click here for the details).
We will be diving head first into this topic in the presentation called Maximizing Cash Flow. You will leave with a booklet of ideas plus we do a bit of group brainstorming session during the workshop, all designed to maximize your Real Estate Cash Flows.

See you there.

 

[DianneDachyshyn]

We would love to hear some teaching on both Vendor Take Backs and Rent to Own. As new REIN members, those are two areas that we have yet to delve into.

 

[invst4profit]

Sorry I realized long after I posted you requested no discussion so I deleated my post.

#?- Assume 50% of monthly income to maintance costs in the long term regardless of condition or age of of buildings. (property management, taxes, insurance, vacanvy, evictions, repairs, advertising, etc.)


greg

 

[Thomas Beyer]

QUOTE (RedlineBrett @ Nov 8 2007, 08:32 AM) 1) Put more money down
2) Depreciate your property to pay less tax right now on your positive cashflow
3) Use the property analyzer issued by REIN (thank you Don - that is a great tool)
4) Use loans with longer amortizations
5) `suite` your property for extra income streams, rent out the garages seperately
6) Market the property as a `rent to own` and ask for a higher payment in exchange for a slight break on price at the end of the term and/or use the tenant/buyer`s larger security deposit to enhance your cash flow
7) depending on location, try for a furnished rental. these are higher cap costs and typically have much higher turnover but you can ask a higher rate
8) Negotiate a short term vendor take back until rents increase in your area - ask for anything: interest only payments, no payments AT ALL, flat rate of $100/ month etc. Sellers are giving deals right now.

That`s all I can think of right off the top of my head

9) buy an apartment building - i.e. less cash per unit / less cash per rental $ received - the bigger the better usually
10) buy outside of expensive areas (i.e. aviod big cities) - go to smaller centers
11) raise rents to "market" or "above market" .. this works only in a strong rental market like AB or certain BC or SK towns right now ..
12) buy agricultural land in MB or SK or South America, rent it to a farmer
13) buy/build a storage facility
14) buy a REIT (BoardWalk, Calloway REIT, NorthernProperty REIT, CAP REIT, Hotel REITs, .. about 30 or so in Canada .. more in the US) - cash-flow and equity growth and no hassles - liquid ! This is where I park my money until I get a good deal myself / for our syndicate .. expect overall 7-12% ROI .. liquidity has its price !
15) get an interest only mortgage, until the building/house cash-flows, then lock in a long term rate (this is what we do all the time .. as the first 18 months are usually negative cash-flow or investment intensive) .. then pull out all your money, repeat !!
16) get a JV partner that gets no cash-flow, just equity upside 3-5 years from now (i.e. your item 1 modified above)
17) invest or JV with others that do 9-16
18) live upstairs, rent downstairs
19) co-invest with students: you put the cash down, you co-own it, 3-5 students pay $300-$500/month
20) more renters per unit i.e. "rooming house" or student dorm or immigrants or hostel .. very management/headache intensive

 

[RedlineBrett]

QUOTE (thomasbeyer2000 @ Nov 12 2007, 07:54 PM) 9) buy an apartment building - i.e. less cash per unit / less cash per rental $ received - the bigger the better usually
10) buy outside of expensive areas (i.e. aviod big cities) - go to smaller centers
11) raise rents to "market" or "above market" .. this works only in a strong rental market like AB or certain BC or SK towns right now ..
12) buy agricultural land in MB or SK or South America, rent it to a farmer
13) buy/build a storage facility
14) buy a REIT (BoardWalk, Calloway REIT, NorthernProperty REIT, CAP REIT, Hotel REITs, .. about 30 or so in Canada .. more in the US) - cash-flow and equity growth and no hassles - liquid ! This is where I park my money until I get a good deal myself / for our syndicate .. expect overall 7-12% ROI .. liquidity has its price !
15) get an interest only mortgage, until the building/house cash-flows, then lock in a long term rate (this is what we do all the time .. as the first 18 months are usually negative cash-flow or investment intensive) .. then pull out all your money, repeat !!
16) get a JV partner that gets no cash-flow, just equity upside 3-5 years from now (i.e. your item 1 modified above)
17) invest or JV with others that do 9-16
18) live upstairs, rent downstairs
19) co-invest with students: you put the cash down, you co-own it, 3-5 students pay $300-$500/month
20) more renters per unit i.e. "rooming house" or student dorm or immigrants or hostel .. very management/headache intensive

That`s a great list Thomas... Thanks for posting!

 

[Thomas Beyer]

QUOTE (RussellWestcott @ Nov 8 2007, 10:51 AM) Howdy. make sure you are at the next Ontario REIN™ members meeting (Click here for the details).
We will be diving head first into this topic in the presentation called Maximizing Cash Flow. You will leave with a booklet of ideas plus we do a bit of group brainstorming session during the workshop, all designed to maximize your Real Estate Cash Flows.

See you there.

Don`t confuse CASH with CASH-FLOW, Russell !!

 

[DianeLeahy]

QUOTE (RedlineBrett @ Nov 12 2007, 10:13 PM) That`s a great list Thomas... Thanks for posting!


What is a REIT?

 

[BMironov]

QUOTE (dymark @ Nov 22 2007, 10:08 AM) What is a REIT?


REIT is Real Estate Investment Trust.
http://en.wikipedia.org/wiki/Real_estate_investment_trust
http://tsx.com/

 

[TylerUzelman]

21.) Depending on the mortgage you have, you may be able to request to "Skip a mortgage payment" once per year. Instant Cashflow! They simply add the mortgage payment to the end of the mortgage ammortization. We actually do this on our entire portfolio once per year, which allows us the cash to renovate one property, purchase another property, or give ourselves a bonus. It`s an option that few people think about, if you were to skip a payment once per year, and that payment is $1,200, that equates to an extra $100 per month of cashflow.

Hope this helps,

 

[Thomas Beyer]

QUOTE (dymark @ Nov 22 2007, 08:08 AM) What is a REIT?


check out: IGR, one of the world`s largest REITs .. in the US with over 50% non-US holdings .. at the current price of around $15 it yields over 9% !! liquid .. and usually equity upside .. or BoardWalk, Canada`s largest landlord: BEI-UN.TO .. over 30,000 apartments .. yiled is about 3.5% to 4% .. not as good but likely more steady cash-flow and equity upside .. plus about 25 others .. some REITS will be taxed as they do non-passive income such as senior`s homes or hotels or storage and that may not be within the REIT tax free exemption in 2010 !!

Essentially though a security / a stock .. and not real estate !