Video instructions and help with filling out and completing Who Form 4797 Investing

Instructions and Help about Who Form 4797 Investing

Is owning rental real estate and a down economy a good move you bet it is that's today's video let's dive in hey there I'm Clayton Morris the founder of Morris invest I'm a long time real estate investor and I want to dive into a question that comes up often or ignorant people that write about this on my Facebook page when I talk about real estate investing and people say well yeah but when the next economic collapse is you're gonna be in trouble actually no you won't if you're smart rental real estate is fantastic in a down economy and it's fantastic in a good economy but there are four key areas that you need to know about in order to maximize your rental real estate of return well just first of all let's just talk in broad strokes and we'll dive into the four specifics in a moment think about a down economy for a moment okay if you're in San Francisco New York or Miami or someplace like that where those people who rent and pay three thirty five hundred dollars a month for an apartment those are the people that typically end up losing their jobs or they're the mid-level managers or so forth who get knocked down and end up losing their jobs those are a neighborhoods properties that I never invested right but in middle America in the great blue-collar hard-working cities where you rent to postal employees and nurses and long-haul truckers and service industry folks those people tend to have jobs that do not get lost this is the case when you look at the 2009 economic collapse those of us who owned hundreds of rental properties in that economy did not see one dip not one dip in our rental income cash flow cash flow is king in down economy people can't afford can't get mortgages so they need to rent why shouldn't you be the landlord they rent from okay so just in broad strokes I want you to sort of pivot your paradigm and thinking about rental real estate in a down economy people need to live somewhere they need to eat right why shouldn't they be renting from you so the areas where you'll see a lot of job loss are in ami roads those are the the more affluent neighborhoods that's the area you're gonna see jobs being cut those are the areas where people are gonna have higher vacancy rates they're gonna start leaving those big high-rise Manhattan apartments and rental prices are gonna plummet that does not happen though in Midwestern markets you may see drop in value but you're not gonna see a drop in your rent that is the case so with that in mind let's dive into four so four areas that you can really protect yourself in a down economy if you are buying rental real estate number one finance only with long term loans it's really important the thing that killed people of course back in 2008 and 2009 is that they had those five year balloon mortgage notes that were coming due and suddenly they were out of a job they couldn't pay this mortgage in full or try to refinance the economy was collapsing get a 30-year mortgage if you need to get financing on a property that you're going to rent out make sure you get long-term financing that way even in a down economy even if the property value plummets you're still able to cover that mortgage note and in a few short years when it turns back up again you're still golden no big deal so get long-term amortized mortgages that number two on the list only swing at those big fat deals that's what I love so the properties that I do at Morris invest we want people to have equity when they close on a property and have a high return on investment high ROI we have another video here that explains just click on it's in the description below on how to figure out return on investment and ROI and I walk you through why that number the ROI number is the most important thing you should look for in rental real estate but go after the deals that you know are a good deal those are the deals you should be buying not the ones where there's a really thin margin as that means thin margins bigger margin for error so number two go for those big juicy deals that can bring you a high ROI and number three on the list positive cash flow I'm all about cash flow cash flow is key you know that is the beauty of owning rental real estate you know people want to talk about having the value of their property plummet a little bit during a down economy okay so if the properties I owned dropped ten fifteen percent of value I don't care you know why because I'm holding these properties for the rest of my life and they are cash flowing seven eight hundred dollars a month from a tenant living in the property I don't plan to sell it so I want that positive cash flow that is king in a down economy so yeah the value may plummet maybe I bought it for forty thousand and it's worth fifty and then at a down economy it drops to 50 or drops to forty five and maybe drops to 42 but I still bought it for forty or maybe even drops to 35 and I bought it for forty okay big deal the cash flow is still there the tenant is not moving out where you buy properties is very important so that's why it's very important to educate yourself on the markets which have long-term blue-collar tenants in great economies that don't really get hit by the economic strife that you would experience in some of