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Originally posted by Jimineer:

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Originally posted by JALLEN:

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Originally posted by Jimineer:
An alternative to REITS are MLPs. Like REITS they have to pay out profits to shareholders. MLPs own natural gas pipelines that transport products for the producers. They also may own oil and gas pipelines, I'm not sure. Since what money I do have is in IRA and 401k I can't own MLPs. At one time not long ago they were a good option for income producing investments, and still may be.

Since the OP asked about real estate investing, that is what we have concentrated on, even in the drift to REITs.

I would never invest in MLP. My rule was that it had to be publicly traded, or I had to handle the money. I had been a title company lawyer early in my career and seen how often private funds are embezzled, or mishandled in some way that led to disaster.

As it was, I not only walked through the Valley of the Shadow of Death on a couple of occasions, I owned a couple of lots in the Valley!

When JALLEN speaks, I listen.

Oil and gas MLPs are publicly traded on the NYSE. Once the discussion drifted to REITS, to me it became about an income producing investment with potential for price appreciation. E.g., the MLPs. But I'll read and not post now.

I was not aware any were publicly traded. Drift on! Tell us more.

I'll let S&P tell us more via the linked article. I considered buying into MLPs years ago but come tax time, you'll need a CPA to do your taxes on them. The article is too long to paste so I'll just provide this link to Oil and Gas Financial Journal.

One example of an MLP is NYSE: WES, Western Gas Partners.

http://www.ogfj.com/articles/2012/10/standard.html

Thank you for the info. I'll check into them a little deeper.

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Originally posted by Jimineer:
I'll let S&P tell us more via the linked article. I considered buying into MLPs years ago but come tax time, you'll need a CPA to do your taxes on them. The article is too long to paste so I'll just provide this link to Oil and Gas Financial Journal.

One example of an MLP is NYSE: WES, Western Gas Partners.

http://www.ogfj.com/articles/2012/10/standard.html

Thanks. I'll have a look.

One of the happy benefits of taking care of my little brother all those years, making sure the bears didn't get him, blazing the trail with mom and dad so he could do stuff, etc. is that he grew up to be a CPA and does my taxes

I have some Vornado, Urban edge properties ( which was spun off of vornado I think) and some of the Schwab proprietary REIT ETF. Schwab charges no commission to buy their own reit and it's a fund of funds so I'm getting exposure to many other REITs. The trade off is the yield is only about 3% I can buy $50 worth or $5000 worth and no commission ( inside my Schwab account) so it's easy to addd a small position every month and keep transaction costs at 0$.

I personally think some publicly traded MLP that are in the energy field are prime to take off if and when oil picks up. Some of them are really beaten down right now after oil has been crushed the last few years and they are still paying insane dividends. I own AMZA that I picked up in the single digits per share and yields 2$ a year in dividend and when oil takes off the share appreciation will be good as well. The pipeline MLPs also give you exposure to natural gas which will do well long term as well. My opinion only.

Personally I would never get into a non tradable REIT or MLP or anything else unless your very very well heeled and can absorb 100% loss and/or having your money locked up for many years. I prefer publicly traded where I can sell tomorrow and have cash in my account in 3 business days

I would not buy real estate for investment income at this point in time. I know nothing about the DFW area, but here in South Florida investment properties are priced too high to make a return high enough for me to want to touch anymore of them. (duplexes, tri plexes, even 4 plexes and apt buildings). The biggest mistake many people make is they buy something and over estimate their return and under estimate their expenses.

I only own a condo (rental) and a 4 plex (rental and my own house. Debt is your biggest enemy. I paid cash for my 4 plex and house and have a small mortgage on the condo. That being said, if I have one problem tenant I'm not sweating financially. You make your money on the buy, not the sale of a property. Getting a good deal with a good return right from the beginning is crucial as I've been seeing expenses go up a lot faster than you can raise rents.....mainly property taxes and insurance here in South Florida.....both have seemed to go up 10% and almost 20% each year for the past 5 years. Make no mistake, babysitting tenants are a job.

The way I value a property, is I figure 10 months rent -12 months expenses.....(1 month goes to repairs, 1 month to vacancy) and if that number isn't a MINIMUM of 10% ROI I'm not even interested.....I really shoot for 15% ROI (paying cash for the property). That's near impossible in today's market. Otherwise the hassle and headaches are just not worth it for me......I'd rather just have paper investments.

Everytime you have a turnover you lose 3 months rent.....1 month to vacancy (if you're lucky), 1 month goes to the realtors commission, and 1 month goes to painting and refreshing the unit.....sometimes the refreshing cost is less.....and the vacancy is longer....it usually always works out to a 3 month loss one way or another.

I only have 5 tenants, but 1 slow paying tenant or pain in the rear one (you know the one that calls you when a light bulb goes out), is more work, time, and aggrivation that all 4 other ones combined.

I've been lucky almost all of my tenants have been very long term.....currently right now tenants have been in their units since: 2008, 2010 (2), 2013, and 2o14......same token though.....you raise rent a little on good tenants over time, but not enough, but not nearly what market is if you re-rented it.

I've found the trick in the real estate market is to retain lots of cash when it's good, and only buy when there's a downfall, seems there's a downfall every 7-10 years..... dot com bubble in the 1990's, sept 11, 2001, real estate downturn end of 2008, and that is when you buy. I'm no expert like Jallen and some others that have posted, but this is what works for me. Frankly, it's a heck of a lot easier to find some good investments such as mutual funds etc. and just collect a check without the hassle.

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