“I’m Trying To Prevent a Nightmare!”
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- Опубликовано: 2 окт 2024
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Bet a dollar, she won't do anything they recommended.
No because his opinion is stupid
I'll see you and raise you $5 because the husband hasn't heard Dave's rants
When Dave uses logic and the ensuing silence always causes shivers down my spine in secondary embarrassment
Only making $50 a month on the investment property. Does she know that there is always hidden fees and $50 a month is not going to cut it.🤔
The house they rent out is part of their ego boost when out with other people their age..”we’re landlords”
They just leave out how they are Not financially stable.
To be fair, they could probably handle both mortgages as she said they had no other debt, but that rental property is a potential bomb with very little upside.
It seems like she was calling to brag a little at first and got totally shut down
True
Typical 20 somethings buying investment properties because they saw it was a good idea on TikTok.
They're all trying to outdo each other. It's pretty entertaining to witness!
Nailed it!
They are 100% not going to sell this “investment” property 😂
Selling it ia stupid, daves plan sucks
2 investors, under 30, think they know better than Dave Ramsey.😮
@@roseother8306 daves real estate plan is delusional, no one with normal income can ever buy rentals with cash
Thats stupid
His plan works for the 1%
Yeah and I bet you have more money than he does too. Congratulations.
yeah, people are dumb. That 50 a month is a game-changer…..😮
"I'm not a dream killer, I'm a nightmare preventer. There's a difference." ~ Dave Ramsey
Roll credits 😄
I make more than $50/month of interest on my savings account lmao
We need a t-shirt “babies can live in condos”
Babies can, but they grow fast. They do need to be getting situated to buy a house in a really good school district sooner than they think.
Otoh, she's only 27. They have years.of fertility left. They can delay the kids until they are financially ready.
"Babies can be in sedans" is next.
So many friends have a child and go and buy a 80k suv right away.
Just from her tone of voice she's not getting rid of the rental property.
I agree.
She's an adult. She can swim in her turds
You could hear it when she said, "Well, *yeah*, but..."
Out of that $50 "profit", they have to pay income taxes, so it's actually $40. But then they have property taxes, homeowners insurance, maintenance, repairs... If the tenant leaves and they go even one month without a tenant, that wipes out 32 months of this imaginary profit anyway.
And there are several other expenses as well.
And she's "shocked" that Dave says they are losing money. WTF.
*The decisions we make in life can have a huge impact on our finances. It's not just about when you start, but what you achieve in the end that really counts. While RUclips is great, having a mentor helps you understand better.*
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Sounds to me like they can’t even afford a kid
Weird that 28 people liked this comment without hearing anything about her finances. How do you know if she can afford a kid when she didn’t even mention her household income and expenses?
@@realcomments7205yea I was looking for income couldn’t find it
Read again. The commenter simply said that he bets she can’t even afford again. He made that assumption based on what she said. Commenter never stated it was a fact, he (or she) was simply stating an opinion. @@realcomments7205
@@realcomments7205because she’s actually calling into a financial radio show for help when most people that don’t worry about finances don’t go to that extreme. Maybe that’s a sign?
Their cash flow on their rental property is god awful. This woman and husband are highly leveraged here. Also a 450k condo might be hard to sell because it's so expensive. Especially in salt lake city
U are joking? Slc is getting more and more expensive, 450k is not that expensive there
Cheap in salt lake, but condos are less desireable. People seem to love real estate in Salt Lake City. Everyone takes out debt to buy 2nd and 3rd properties.
I used to own a condo that I rented out for 4 years at a $700/month negative cash flow. I think my schedule E in the worst year ended up being a $12k loss. It sucked but I was lucky I had tenants who paid their rent. I ended up taking a personal loan of about $30k in order to pay the difference between loan balance and value and sell the place. Purchasing that house was the worst financial decision I ever made, but selling it was the best decision I ever made. And btw I didn't buy it as an investment property, I bought it because I thought it was smart to do as a dumb 25 year old only to find it was too small to support a family.
SLC prices are rising rapidly. Californians who have never seen a house worth less than $1.2 million are flooding the place.
@adamseidel9780 People who are looking for that doubling in prices that we saw from 2020 to 2023 are gonna be out of luck. People fled CA covid lockdowns. Those have obviously stopped so migration will slow. Wages haven't kept up with prices so no locals can afford to buy. Either prices will drop or they'll likely remain stagnant until wages catch up. Nothing else makes sense.
The $50 return on the “investment property.” My goodness. Lol, George 🤣🤣
@@egeb Most mortgages, taxes and insurance are included. They put tat into an escrow account.
@@jimmymcgill6778but not the HOA dues…😅
@@davidruttenburg5326 Not all condo's have HOA's.
Only $600 a year profit on her rental property. And that's a best case scenario. 🤮
Thats stupid
U own the thing and every dollar the tenent paying goes to your equity
I wish Dave would have explained it that the money they are putting into this and the value of the home growing would not exceed them selling it then putting that money in the stock market and letting it grow there.
She owns $476K condo in 2022 and has a mortgage. Then she has a $1600 a moth mortgage on an "investment property" with a tenant that pays $1650 mortgage. She doesn't get it. If the tenant gets laid off, leaves, refuses to pay rent, or government says its ok to not pay rent due to a virus, she is done.
$50 a month in gross profits. Hahah
appreciation might be worth it though.
@@BrettMaverickExactly. Quite a few people fail to realize that as long as an investment property is paying itself off and money is set aside for repairs/emergencies for the property, then the investment is worth it. Furthermore, some people have incomes high enough that they may have already budgeted to just pay the mortgage on their investment in the setting of no tenant. Dave is ultra conservative because most people don't have these fallbacks.
50 dollars is not a profit anyway. It's laughable.
@@evidencebasedlife137average real estate appreciation is about 4% a year. Less than the average stock market returns. Worth it to invest in rental properties? Not to me.
She said that beside their current condo, they have another mortgage AND the “investment” mortgage. They have three mortgages, why not sell two and live in one? Also, who pays over $400k for only two-bedrooms???
I agree - aside from the $400k. Depends where you live. In my area the cheapest 2 bed 2 bath is $850k
No she said we have two mortgages. The condo and another mortgage for a investment property
@@reese85 I came to this conclusion as well, but on first listen, it was confusing.
@@linuxsurfer2002 lol it was. I had to listen to it more than once myself
Over 400k condo in salt lake city at that. Yikes!!
These young families try to get into these get rich quick schemes. There are many things that can happen with the rental property. You have to have an emergency fund for the rental and for your property. Believe me I know. When my renters first moved into my condo. I had to buy a New Air Conditioning Unit. The cost was $4000,00 after that I created an emergency fund for the rental now the fund is at $10,000. I have a 401-K that I deposit the rent into & boy does it grow. Especially this year so far.
Either the house is a dump or they're not charging enough for rent. If the monthly payment is 1600, the rent needs to be 2 grand or it doesn't make any sense at all....
Why would you rent a house out for a $50 positive cash flow? Why would anyone think that would make sense? When the tenants move out, the repairs needed to have the home rentable again wipes out any profit you made and that’s best case scenario. When the escrow adjusts on the property, then it will be a negative cash flow property.
Or just raise the rent to 1800. But she gave so little information that it’s hard to say. How much is in their savings? Where is the rental property? If they sell, will they be taking a loss? Very vague. She should probably sell it but still
Still not enough profit and I don’t think you can raise rent up that much on current tenants
Yeah if they're giving a tenant a deal cause they've been there then they need to start gradually raising the rent up to market value at each lease renewal. If market value is 1650 a month then they should just sell it, take the equity and either re-invest or pay down debt.
Rental market doesn't work that way. The surrounding, like-kind rentals set the rent. You can't just set the rent to whatever you want. Her problem is her mortgage payment on it.
I agree, so many important details left out.
But Dave! Her and her husband LOVE to say the words "investment property" because it makes them feel savvy.
I just enjoy being financially stable. I'm clearly a dinosaur. 😅😅😅
I bet they mention their "investment property" a lot to flex in front of their friends. Really nothing to brag about if it's actually losing them money.
"My husband is 28, and "myself" is 27" 🤔 This girl needs some more education, both in the English language, and money!! 🙄
That's when I would've walked away from a conversation.
@@floresnashvilledrummer😂🤣
Caller: “My property is losing money.”
Dave: “Sell it”
Caller: “Shocking”
😂
She does not yet understand 600 a year over mortgage will not cut it. ONE call to a plumber or whatnot, all that money is gone.
Yeah, this property needs to go. This couple doesn't sound as if they have enough margin to carry through WHEN, not if, (choose one: it sits empty for a couple of months, the tenant doesn't pay rent and it takes 3-6 months to evict, you have to put a new roof or other expensive repair).
I've owned investment properties that didn't cash flow very well. Difference being, I had enough reserve margin from my other properties and the underlying value of the property (location, location, location) made the risk worthwhile. The old adage is correct, in real estate, you make money on the purchase. Sounds as though this couple overpaid relative to the income potential (assuming there are no alternative reasons such as the scenario I gave above).
This women bought at the peak of the market and sounds awfully proud of it. That same condo cost in the low 300s 2 years before she got it. She wont see the same gains the previous owner got in the next 2 years.
I'm not sure that selling is the right answer. I would have liked to hear Dave ask her why the rent was set so low, or why the mortgage payment was so high. One of those is probably out of order. Can she charge higher rent?
If she got a 10-15 year loan at a low rate most that payment might be equity in which case it's probably fine
Even if they could increase the spread, Dave's philosophy is to never buy an investment property with a mortgage. Pay for their residence first, then save up for rentals. He's said that a thousand times in all his videos
@@curiouscat3384 but if you do that you'll get rich slowly. It works but it's not the best for everyone
Hold on here how big is the house anyway If it's like 3 bedrooms that can work for them and they can sell the condo and pay off the house and then maybe in an x amount of years they either can rent it out again or sell it and get another house
Hvac doesn’t cost even remotely close to $4,500 anymore. She needs to sell it, if her hvac goes out and she needs to replace it with a licensed contractor she will spend twice that now days. As a person in the hvac business and who owns rentals she will be screwed at some point and it will be an absolute panic when least expected.
I don't understand why they would only put the rental unit at only $50 a month over the mortgage payment?????
Because they’re not greedy like every other landlord out there?
Out here in California the houses get bought up and immediately put up for rent. Because we have rent control here rent is much cheaper than owning currently is. So when people do that they are losing $2k a month. I don't fully understand why they do it unless they are trying to clean drug money
@tmi4507 greed has nothing to do with this. Maybe you have never been a homeowner, but there are a lot of maintenance costs beyond the mortgage payment itself. Rent should be set to cover not only the mortgage but also upkeep, and still provide a modest profit above that. $50 a month over the mortgage payment amount, like Dave said, is guaranteed to be losing them money.
@@alladreamwedreamed it’s prob a single family home and $1650 is prob the market rate for that property. You don’t really make money investing in single homes as a landlord
Because that's all the rent the market will bear. The problem is not the rent, the problem is their mortgage payment.
I don't completely agree with Dave. It really depends. My first property was a flip that got me enough money to pay 50% down on my first rental property. My mortgage was the same as rent because I want to pay it off in 5 years and I make enough money to do that. But when interest rate dropped to 3.5%, I refinanced to 10 years and paid slowly and took on another mortgage to buy my current home. It was a cheap home, I paid 50% down and did a 15 year loan. Fast forward to now, both house are paid off and I also bought an airbnb property in 2019.
I have a nephew who has an “investment property” with a mortgage in Southern California of $4,700 (including property tax) and the rent is $3,500
I could NOT talk him out of it… it’s been 4 months we shall see how it goes
Is it a duplex? That’s probably the best case scenario in that situation 🤦🏾♂️🤷🏾♂️✊🏾
RIP your nephew
WOW!
Up the rent on the investment property.
Bursting bubble. I am not a dream killer I am a nightmare preventer,, russian rullet with checkbook
How much mortgage is left on the investment property? And property taxes?
Property taxes are most likely escrow into the monthly payments but as far as to how much mortgage is left. I’m sure it’s a good amount
29 years im sure, lol
So many younger people “investing” in rental properties, who have zero business doing so. Wow. Don’t know what the hell you’re doing and don’t have any money either. SMH
People rationalise a losing investment property, but at the same time are skeptical if told to invest in the stock market.
Or they are skeptical if told to pay off their own home early 🤣
Thanks Uncle Dave for your wisdom and common sense!
They spent a half-million dollars on an apartment? I would never be that stupid!! We own a huge home for a third of that!!
That’s actually almost the average mortgage/house price in America
Not to mention, condos don’t really go up in value. And then you have condo fees
Depends where you live. Easy to sit in a corn field and tell people they overpaid.
Real estate prices depend on where you live. Now I informed you, your welcome!
Decent 2 bedroom condos in denver are $400k+ in the suburbs. Any less than that you are starting to look at a dump
$50 cashflow 😂
28 year old couple wants to live like their 58 year old parents with half a million dollar condo and a rental property. what could possibly go wrong?
BABIES!
She is not making $50 per month profit because you have to deduct property taxes and insurance! That is why Dave said she is really $5000.00 in the hole YEARLY!!!!!!
Repent Repent the day of the Lord is at hand! If you have not received salvation from Jesus Christ you will spend all eternity (trillions and trillions) of years in hell...There will be everlasting torment for you and everyone you know who doesn’t know the Lord. There will be whaling and gnashing teeth. Where the fire is never quenched and the worm never dies. Repent today cry out for mercy! A man must be born again to enter the Kingdom of Heaven. Jesus said unless a man is born again he cannot see the Kingdom of God. Have you sought out scriptures to know what this means? Do you know the gospel of your salvation? Do you know where you will spend your next life?
We have friends who owned two family and lived on one floor (with her dad giving them the down payment), didn’t want to raise their kid there so they as moved into a 3,000sqft house and now have a section 8 renter then was stupid enough to have a family move in and the family told them they’d sign a 10 year lease contract. And they agreed. They only wanted to do all this just to say they’re landlords. Oh and he puts everything on credit cards.
Poor Dave is exhausted from giving the same advice over and over. Time to retire :) This young couple was watching house values zoom up in 2020-21 and are hoping their investment house will do the same in the future.
Nobody under the age of 80 should retire
Nothing made me angrier than my wife colluding with my parents to pressure me into taking a mortgage after the kids were born. It worked out and I’m paying down the principal with all my might, but these kids never required an extra 500 square feet for over double the housing expense. I took a mortgage on the house with her guarantee I would never hear another word the rest of our marriage about moving.
Apparently Sarah thinks she has more experience in real estate than Dave 😂😂😂
If she has enough income, this wouldn't be bad, as each month they are paying down the mortgage. I would want to do it on a 15 year mortgage though, and only if i could afford to pay it if the renter drops out on me.
A whole $50 a month!?? KERCHING!!! I hope she doesn't spend it all at once.
Not sure why but I watch Dave hit the callers mute button on almost all his videos , sometimes I think he cuts them off to early .
I have my emergency fund in a Mega Money Market Account and I make about $90 per month.
It sounds like they are going to lose everything. Please don't bring a child into this world.
Too many comments about raising the rent. Its not about raising the rent, its about buying an investment property at a good price to begin with so that you can charge a fair price rent that will afford you a cushion. The tenant should not have to pay for a landlord's mistake of paying too much for a property or for having a mortgage so high that they can't get a decent cash flow.
Well put I cannot grinne more sincerely
That's one of the first comments i've read in the upper twenty or lower around ten to twenty comments that actually made plenty of sense addressing both ends of the problem.
There are too few details to come to any reasonable conclusion. 2 important questions: why are you only charging 50 over mortgage, and, who are the tenants to you?
Wow dummy moves all over they should had rented an apartment saved up for a home first before the rental.
Dave is 100% right when he says people who deal with real estate have broken risk aversion meters. They only see dollar signs and leave 0 margin for error.
$4500 HVAC unit is cheap! better double that.
Check the capacitor. My HVAC unit stopped working and I researched and told the tech to look for things to fix, not to tell me to replace it. Priced up capacitors are cheap. Replacing the entire thing will cost a lot.
The investment property is NOT “losing money.” At that mortgage, they’re probably gaining about $400 a month in equity off of somebody else’s capital. That’s a win.
They are, however, cash flow negative over the medium term with only a $50 monthly profit, which isn’t enough to cover routine maintenance, much less vacancies and large repairs.
If they have the income to sustain, say, a vacancy situation from a cash flow perspective, then the risk is probably worth it for the free equity, but I doubt they do, in which case it IS accurate to say the endeavor is highly risky, probably too risky to be a worthwhile long term investment for a young family.
Dave is exactly right. The mortgage brokers try to pitch capital growth on £100 a month rent above the mortgage but dont factor in expences, voids, non paying tenants and repairs and maintenance.
$50 monthly "gain" geez. I mean, taxes alone eat that x10 and adding maintenance they are losing big time. Rent needs to be about $2400 to pull even a couple thousand a year without any maintenance.
I wonder when Dave will talk BITCOIN again hahahhahaha
Simple math if the house payment 1600 a month and they’re getting $1650 a month that’s a whopping cash flow of $600 a year I promise property taxes loan are a ton more than that specially depending on wherever they are and homeowners insurance probably at least three times that They’re definitely losing money every single month and astonishes me how many people can’t do basic math today
The investment condo might be making money if almost the whole mortgage payment is going to the last little bit of principal. It's not about the payment it's about the equity. Probably not the case though, or she would have said
I wonder what people like this use for a brain!
Having been a landlord in the past I totally agree sell the property.
Additionally why do you need a bigger place. Per your comments you’re just starting a family. Two bedrooms Is plenty.
I'd like to know what The Ramsey Show thinks of Costco. I would never pay for a membership to purchase consumer goods. I compare it to having a credit card to collect points for something.
I am surprised with the lack of choices Dave presented here to tackle the issue.
Raise the rent maybe? $50 - 200 raise solves the issue without spending 20k on closing costs to sell.
Knew where this was going when she said “we are now looking to grow a family so hopefully we’ll be growing out of it sooner than expected”
The baby can’t possibly live in a 2 bedroom condo?!? Probably needs a bigger car for the baby too
What happens when she goes a few months without a renter, someone loses a job, she is out on maternity leave, etc
How do you have a degree in real estate? It’s constantly changing.😂 real estate people are full of themselves. Dave should start working construction for a year.
✝️
She got to be kidding ridiculous
I swear, no one wants a sobering experience, even though they know what they have to do. All this false hope...
A property is a liability until you sell it.
Dave when he realized she not gonna get to the point. Lol head down. Of course she wants to stay at home.
I did it right. In my late '20s I started an annuity and contributed regularly.
I' went through 5 financial companies, each one got in trouble with the Feds.
At 69 I had $50,000 in my fund. I took a deep breath and put it all into Tesla. Two months later I had $400,000.
Tesla wags up and down drastically. Currently I have $200,000 -- still a lot more than $50,000.
I'm watching it. If it jumps up again I'm going to take it all out and put it in my bank's investment program.
If Tesla drops, I'll buy it again.
G.D. the financial institutions! DO NOT TRUST THEM.
Think about how much you would have had if you invested $50k during the pandemic in TESLA
Sarah’s not listening.
Get out of debt and stop being broke by buying George’s book. Oh the Irony 😂
Dave forgot about expenses on the rental which is taken off their taxes.
do condos appreciate as much as single residentials in california or in general?
Is there a threshold where it makes sense? I rent for 1300 pay 1110. Townhome Solid renter in lease til Sept 2025. Intend to sell after Is that enough threshold?
No. You should be getting double or triple your expenses or just buy stocks
what is she has 50-75k equity in the rental property?
It's not a great cash flow now, but without more info, just sell it, is not necessarily good advice. Is it likely to appreciate, meaning is it in a good area? How much income do they have in case they need to fix something big? Remember, it may not be generating much income now, but the tenants are paying the mortgage. They may be covering the taxes and insurance, too, if they are in escrow.
So basically your guard argue with a mechanic. Who's been there done that scene? It dealt with it for decades about your car. You who have no experience repairing your own car and want to argue with the mechanic. Who tries to tell you that? The main reason why the scanner toll is stating in error code. Applicable to your spark plugs or Ignition coils or both. Is that your car has over a 120000 miles? And neither one have been replaced yet.?
(Facepalms)
It might it's going to it may doesn't mean it will appreciate
You cannot operate a business based upon assumptions. As dave has already pointing out that's how investment realtors go brooke
It's not rocket science
@@motoryzen I have been there done that scene. I have 6 properties generting considerable profit. A couple of them did not always generate a good profit. They are in good locations and rents have gone up while the mortgages did not. I am 61 years old and I would not be a millionaire on paper had I followed Dave's advice. I think he is awsome on most things and for most people, but not everything. When he talks about going broker it wasn't because a bank called a conventional mortgage, he was leveraged with basically loan sharks. And yes I do not always agree with the mechanic, or the Dr, or the accountant etc. I think, research and make careful decisions.
Twentysomethings living above their means.
They are not going to sell that investment property 😅
I wonder how they’re in such a good position at that age
They are not, they have way too much debt!
@@workinonit9562 they’re 27 & 28 with two properties and that’s their only debt (so they say) that’s a damn good spot to be at that age
@@workinonit9562 they’re 27 & 28 with a half a million dollar condo, a rental, and no other debt aside from their mortgages. Lol they’re in a great position
They’re 27 & 28 with a half a million dollar condo, a rental, and no other debt aside from the mortgages. They’re in a great position. Lol
$600/year profit on their rental property will not cover regular normal wear and tear repairs. One call to an electrician or plumber will eat all that up.
I was able to name my price with the electrician I hired. It was still $400 and a $25 gift card.
@@wewhoareabouttodiesaluteyo9303 Yeah, I am generalizing on the price, it will not always be that high, but it is not an unreasonable price to look forward to for an emergency call.
Unreel
Rich people problems.
They are far from rich with two mortgages!!
Raising rent isn’t an option?…
It is unethical. Rent should only be around $783/month
Does everyone want to be a landlord know a days ?
Not me. Don't want to be a renter, either.
@@Vydio yeah a home owner but everyone wants to own an empire lol
What about a 1600 payment and 2500 rental income?
Yeah, good luck with that when you're tint. It finds out that's the spread regardless even if that tenant is a good tenant and hasn't broken a single thing that tenants gonna move out within six months or less.
Being ingredient is asinine and that's not how you keep customers
5:19
1550 is really low in utah
Had a duplex i house hacked in 2016. Roomate and tenant covered $1050 of the $990 mortgage
Repaired water heaters, gutters and drain tile in my 4 years there. Sold it in 2020 due to "not worth it anymore". It paid for my wedding.
Long story short, if you do this, make sure you live on site and get really lucky that the market explodes in 4 years so you can sell at a profit and get OUT
She is not selling it
how much should she be charging her tenants?
Rent is set based on the current market rate for other rentals of that size in that city, in that neighborhood, in that condition, with comparable features. Maybe 1650 is the highest they can charge and still get someone to rent the place. Unless they are really clueless, they would have looked at increasing the rent as the first method of increasing their income stream above 50 bucks a month.
Ramsey is completely coy!
She should raise the rent period for more cashflow
I am happy to be here ❤