Quote:
Originally Posted by SteveHardeman
I believe that your friends are making great money on houses they're buying right now. However, if they've been a full-time real estate investor for a long time, then they now owns homes that hthey bought in 05 and 06 that are worth half of what they were when they initially purchased them. So, while they're making $60000+ per property, I would assume a lot of that money is going toward losses on props they bought a couple of years ago.
The BEST situation someone can be in at this exact moment is that they had never bought a property in the last 5 years and are just now jumping into it. Those people have the world of real estate profits at their fingertips.
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He does not have money going towards any losses...all of his rentals...homes/businesses are paid for...all he does is collect money from them. As far as any purchases he may have made in '05-'06...they would have been fixer uppers/foreclosures that he acquired at a reasonably low price and he would have already flipped them or have them rented. Either way when you own a property whose value may have decreased...the only way to lose money on the deal is to sell it...because if you retain it...the value will eventually go back up.
I never lost any money when I was in that business...though I did barely break even a couple of times.