Additional/Secondary Income Streams

[brobro777]

1 hour ago, This2ShallPass said:

 

This was me. Had a rental in Texas that I bought and sold sight unseen. Held it for 10 years, but I was way too lenient with the tenants. One of them was a single mom—seemed genuine, but just didn’t have her stuff together and was always dealing with some financial issue. I’d get these long emails, and since the payment being late wasn’t a huge deal to me, I always felt bad pushing her. Clearly not landlord material

It dragged on for a while, and when I finally sold, they’d left the place in rough shape (property manager didn’t tell me either). Had to spend a lot on repairs before I could sell.

Still made a solid profit—bought it with just $5k down on a great deal. But the experience kind of sucked overall, and I’ve decided rentals just aren’t for me.

 

I played landlord in Los Angeles years ago and while I had good tenants, sometimes the tenants had people around them who caused problems

 

Like the last tenant I had was a nice girl who paid on time but her boyfriend was a dumbass who came over and vaped and smoked in the condo, even though he knew the entire building was smoke free. I found his weed and stuff after she moved out and I decided no more baby, no more

 

But it turned out pretty good because I sold that condo in Dec 2018 and bought SPY on Dec 26 2018 with the proceeds. One of the few times I've "picked the bottom" in my life - SPY at $236.2463!  haha yes

 

 

[73 Reds]

11 hours ago, brobro777 said:

 

I played landlord in Los Angeles years ago and while I had good tenants, sometimes the tenants had people around them who caused problems

 

Like the last tenant I had was a nice girl who paid on time but her boyfriend was a dumbass who came over and vaped and smoked in the condo, even though he knew the entire building was smoke free. I found his weed and stuff after she moved out and I decided no more baby, no more

 

But it turned out pretty good because I sold that condo in Dec 2018 and bought SPY on Dec 26 2018 with the proceeds. One of the few times I've "picked the bottom" in my life - SPY at $236.2463!  haha yes

 

 

Being a landlord is much more hands on.  If you own more than just a few units, it becomes a quasi-full time endeavor unless you are willing to pay for property management services.  My way of handling this issue is to own rental properties in partnership with others.  Those of us who don't want to be personally involved provide money, certain services (legal, title, etc.) in exchange for those who handle day-to-day matters.  

Edited July 12, 2025 by 73 Reds
spelling

[Whensthepaintdry?]

I have a few Airbnbs. It’s not passive, but the extra income generated compared to normal rentals is worth it for me right now. I have also managed other people’s Airbnbs in the past for 20 percent. Airbnb has a nice co hosting option. It is a pain in the ass though. 

[villainx]

59 minutes ago, Whensthepaintdry? said:

I have a few Airbnbs. It’s not passive,

 

This could not be more true, from my limited experience.

 

 

[villainx]

1 hour ago, 73 Reds said:

My way of handling this issue is to own rental properties in partnership with others.  Those of us who don't want to be personally involved provide money, certain services (legal, title, etc.) in exchange for those who handle day-to-day matters.  

 

Do you agree on the rates of each service before hand?  

 

I mostly partner with extended family and while it was never stated before hand ... so far I've only asked for token amount for day to day property management.

 

[73 Reds]

2 hours ago, villainx said:

 

Do you agree on the rates of each service before hand?  

 

I mostly partner with extended family and while it was never stated before hand ... so far I've only asked for token amount for day to day property management.

 

In my partnerships we play to our respective strengths.  Day to day operations are far more time consuming but excess capital and directional skills are just as, if not more important for long term success.  There are written partnership/member-operating agreements in place which delineate each partner's respective obligations and responsibilities but we tend to refer back to those only when disputes arise (primarily about money).  When entering partnerships it is important to understand the capabilities and drawbacks of your partners so as to have realistic expectations when issues do arise and also common objectives.  This specifically requires the availability of adequate capital at all times for repairs, improvements and expansion.   At this stage of my life all day to day matters and tenant issues are left to my partners and our meetings tend to focus on more long term issues.     

[brobro777]

6 hours ago, 73 Reds said:

Being a landlord is much more hands on.  If you own more than just a few units, it becomes a quasi-full time endeavor unless you are willing to pay for property management services.  My way of handling this issue is to own rental properties in partnership with others.  Those of us who don't want to be personally involved provide money, certain services (legal, title, etc.) in exchange for those who handle day-to-day matters.  

 

That's a good setup bro - you partnered with a team that's sufficiently incented to actually give a shit and that probably gives you a competitive advantage against the vast majority of landlords in California. Certainly against small time guys like me who was just renting out one condo they used to live in

 

But for me cigs and stock index futures are way easier than landlording

 

[73 Reds]

17 hours ago, brobro777 said:

 

That's a good setup bro - you partnered with a team that's sufficiently incented to actually give a shit and that probably gives you a competitive advantage against the vast majority of landlords in California. Certainly against small time guys like me who was just renting out one condo they used to live in

 

But for me cigs and stock index futures are way easier than landlording

 

Yeah, rental properties are not a passive endeavor by any means.  Yet I maintain that direct real estate investment is in most cases far superior to public ownership.  Even with a company like JOE that we all acknowledge is doing everything right, it is a slow slog to reach the point when the investment will pay off.  Direct ownership provides immediate tax benefits, current income and cash flow and recognizable capital appreciation.   

[brobro777]

10 hours ago, 73 Reds said:

Yeah, rental properties are not a passive endeavor by any means.  Yet I maintain that direct real estate investment is in most cases far superior to public ownership.  Even with a company like JOE that we all acknowledge is doing everything right, it is a slow slog to reach the point when the investment will pay off.  Direct ownership provides immediate tax benefits, current income and cash flow and recognizable capital appreciation.   

 

You're right. Years ago I was talking to a coworker (socal native born and raised, family been here for a long time) about commercial real estate in LA and she told me that if I want good deals, I should get friendly with the bankers/finance guys in the area cuz they have the loans and info on what the owners want so the good deals get done without showing up anywhere. So with connex with a team that's been in the area for a while, you have an informational advantage and you get significant tax benefits

 

No wonder some of these Cali guys I noticed over the years would just sit there and smile while I complained about capital gains taxes, damn man

 

 

[Hektor]

On 7/11/2025 at 6:03 PM, 73 Reds said:

Hard money is a business built on convenience.  No one wants to pay mid to high double digit interest rates.  But having to qualify for a traditional loan takes time and will cause you to lose most deals.  Most contracts today around these parts are cash contracts with no contingencies - sellers don't want the hassles.  When I finance a property it is the same as cash for the seller.  If the buyer/investor has all its ducks in a row (i.e., title, insurance) I can close some deals in a matter of hours from the time the deal is brought to me.  Many of my borrowers have done dozens of deals with me which makes doing business that much easier.  Its a business that only gets better with time and experience but there is a learning curve and you've got to know the market(s) in which you do business.

Is this similar to a bridge loan - quickly fund but for the short term, while the borrower makes long term funding arrangements?

[73 Reds]

1 hour ago, Hektor said:

Is this similar to a bridge loan - quickly fund but for the short term, while the borrower makes long term funding arrangements?

That is one such purpose.  More often investors acquire properties for either rehab and resale or long term rentals and need immediate cash to finance the purchase.  Sometimes a short term loan becomes extended, particularly for investors who show little or no taxable income and therefore can't qualify for traditional financing.  Other times existing property owners want to cash out a portion of their equity for investment or other purposes and either can't, or don't want to pursue a traditional bank loan.    

[fareastwarriors]

On 7/14/2025 at 5:39 AM, Hektor said:

Hard money is a business built on convenience.  No one wants to pay mid to high double digit interest rates. 

 

I'm paying 12% now on my HML here in Cali. It started at 9.99% but I had get multiple extensions due to a bad architect and slow permitting by the city. I just got another year of runway. I need to finish ASAP before my homerun deal becomes a single or worse! Shouldn't take 2 years+ to renovate a half burned down building of 10 units and new ADU...   

 

Edited July 16, 2025 by fareastwarriors

[gfp]

4 minutes ago, fareastwarriors said:

 

I'm paying 12% now on my HML here in Cali. It started at 9.99% but I had get multiple extensions due to a bad architect and slow permitting by the city. I just got another year of runway. I need to finish ASAP before my homerun deal becomes a single or worse! Shouldn't take 2 years+ to renovate a half burned down building of 10 units and new ADU...   

 

 

Welcome to permitting in the brave new world we live in.  I miss the old days where I would literally "buy the inspector lunch"...  So damn efficient.  

 

What were the fees to close that loan?  I'll bet the all-in effective cost is more than 9.99 - 12% !

[73 Reds]

2 minutes ago, gfp said:

 

Welcome to permitting in the brave new world we live in.  I miss the old days where I would literally "buy the inspector lunch"...  So damn efficient.  

 

What were the fees to close that loan?  I'll bet the all-in effective cost is more than 9.99 - 12% !

Yeah, that's on the low end but all depends on other factors like creditworthiness, LTV, and as you mentioned other fees.

[Eng12345]

On 7/9/2025 at 1:55 AM, Marco Van Basten said:

I don't know where you are geographically, but I can tell you that in many parts of the country including Northeast, and as well as any place with vacation homes will be very profitable for a handyman.  

I'm in the STL area so not a lot of vacation homes etc, but there are plenty of people out here in the suburbs who have no idea how to do anything for themselves. 

 

Just the other day my friend called in a mutual friend to hang a picture in his apartment! 

 

The thing that has held me off of this is my main gig would take priority, and I think I would have a hard time developing a good clientele base only being available ~6 months a year. And I need to look into if the insurance payments would be worth it. I'm not 19 running around with a truck and not a dollar to my name anymore. If I were to be sued, it could be very costly.  

[fareastwarriors]

22 minutes ago, gfp said:

 

Welcome to permitting in the brave new world we live in.  I miss the old days where I would literally "buy the inspector lunch"...  So damn efficient.  

 

What were the fees to close that loan?  I'll bet the all-in effective cost is more than 9.99 - 12% !

It was 2.5 points. The lender is fine. The costs are spelled out and interest was reasonable I thought.  Super fast to close. 

 

It was just all the other issues that came up. Had my builder risk insurance nonrenewed... so was lender's placed coverage. Reached out to nearly 20 insurance brokers and they either just ghosted, are not writing, or just insane premiums. I gave up for a while but finally few months ago, I found something reasonable.

 

Everything is aligned right now so just gotta go and finish. 

 

 

 

[fareastwarriors]

On 7/13/2025 at 4:28 PM, brobro777 said:

No wonder some of these Cali guys I noticed over the years would just sit there and smile while I complained about capital gains taxes, damn man

The grass is not always greener.  I qualified as real estate professional maybe 5 years ago, it was really awesome for a year or 2. Zero income tax. Yay.

 

But nowadays I don't even have that much income/capital gains to offset my losses. It is just building up...Yay me...

 

Right now I'll rather take the large income/gains and pay the tax instead

Edited July 16, 2025 by fareastwarriors

[villainx]

18 minutes ago, fareastwarriors said:

Everything is aligned right now so just gotta go and finish. 

 

Keep at it and good luck!  

 

 

[brobro777]

29 minutes ago, fareastwarriors said:

The grass is not always greener.  I qualified as real estate professional maybe 5 years ago, it was really awesome for a year or 2. Zero income tax. Yay.

 

But nowadays I don't even have that much income/capital gains to offset my losses. It is just building up...Yay me...

 

Right now I'll rather take the large income/gains and pay the tax instead

 

If you want da large gains, you gotta buy NQ at 16800 when the world is losing their shit about tariffs

 

haha yes