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How to get the gov’t to pay you $1,250 every month

gov't bucksHere’s a terrific article from Mark Ford in DailyWealth:

“Every month, the government deposits $1,250 into my bank account. But I’m not collecting Social Security. And I’m not talking about tax refunds or municipal bonds.

I’m talking about Section 8 housing.

Section 8 housing (officially Section 8 of the United States Housing Act of 1937) is the government program that helps about 3.1 million low-income families pay rent. It operates through several programs, the largest of which is the Housing Choice Voucher program. It was meant to pay for “a portion” of the rents and utilities of those in its care. But often, as you will see, payments are greater than competitive rental prices.

Here’s a real-life example…

Peter, my partner in local real estate ventures, recently bought a house in a working-class neighborhood. In 2008, the house sold for $500,000. Three years later, we bought it for $80,000 and renovated it for another $15,000. It’s a three-bedroom, two-bath house with a fenced-in yard, new appliances, and tile floors.

Instead of renting it on the open market, Peter offered it to the local Section 8 housing authorities. They found a young lady with three children to take it. She seems to be an upstanding citizen – she is clean and sober and holds down a steady job. Her only “issue” is that she’s had three kids from different men who don’t feel it’s their job to provide for their children.

The Section 8 people offered to pay us $1,500 a month for this property, which is about $300 more than it’s worth. After Peter and I cover the monthly expenses – the mortgage, maintenance, and taxes – we are netting more than 12% on our cash. That’s darn good money in today’s world. So there must be a catch, right?

I figured the catch would be…”

Read full article




Landlords Claim Discrimination, Judge Agrees

Landlords were handed a victory by an appeals court in Minnesota that determined a city’s aggressive rental housing inspection program may be discriminatory.

The landlords filed a lawsuit earlier over the onerous building inspection program that forced some of them out of business, and made affordable housing in St. Paul a thing of the past.  To read the complete details and history behind this court ruling, go to:


Pimp Your Ads with “Postlets”

You no longer need a big budget to create snazzy-looking ads like the professional management firms do, and attract quality tenants!

Go to The Savvy Landlord website and watch the 5-minute video created by two savvy landlords, which will show you how to sign up for Postlets for FREE (my favorite price).

I just signed up and created my first Postlets ad after watching their video.  It only took a few minutes and it looks great.  Postlets publishes your ad on a bunch of websites, and the video will show you how to easily post it on Craigslist.


Using Rental Criteria to Avoid Violating Fair Housing Law

happy tenantsHere is a really great article recently published in “The Landlord Times,” a monthly publication circulated to more than 6000 Utah apartment owners, property managers, and other members of the Utah Apartment Association.  I am re-publishing it here, with permission, because it discusses Federal Fair Housing Law in an interesting and understandable way.  Each and every landlord should read it:

“[It’s always] a good time to brush up on ways to avoid discrimination claims. One of the best ways to avoid discrimination claims is to have a list of the criteria you use when evaluating a tenant. It is better to have objective criteria and use those than to compare people to each other or use you “gut instinct” to evaluate if someone is qualified to rent from you.

It is natural for owners to want to compare prospects against each other. But BEWARE! Because of Federal Fair Housing Laws this can get you in trouble. Here is an example:  More…


“For Landlords, This Could Be The Perfect Storm”

Josh Mettle & FamilyMy son and investment partner, Josh Mettle, publishes an exceptional Mortgage Blog as well as a print newsletter.  In the Spring issue of his print newsletter, he said something very important for landlords that I want to share here:

“…I should mention that rental properties are about as good a hedge against inflation as you can possibly get.  I’m personally getting pretty nervous about the money printing and inflationary actions of the Federal Reserve.  One of the first things that goes up in an inflationary environment is rent and, as a landlord, you have the benefit of making your fixed mortgage payment as you steadily keep raising rents to keep up with inflation. 

We also have a very unique and pro-landlord situation brewing today as many people’s credit has been damaged and many others have just been convinced by the media that it might just be better to rent.  I personally think that is a bad decision, but for landlords this could be the perfect storm. More…


Ordinary Income vs. Capital Gains

money treeIt often pays to “venture” outside of your area of expertise and inspect the thoughts of other professionals.  Fred Wilson is an investor, venture capitalist and professional blogger living in NYC.  On May 2, 2011, he posted a blog about the difference between ordinary income vs. capital gains which is really worth reading for income property investors: 

“Today, I’d like to talk about ordinary income vs capital gains. This is not tax advice. I am not a tax lawyer or a tax accountant. I hope both tax lawyers and tax accountants show up in the comments as this is important and complicated stuff.

When you think about the various ways you can make money, two ways predominate. You can provide services to others and get paid for those services. That is ordinary income. And you can invest in something; shares of stock, a building, a domain, and then sell it later for more. That is a capital gain.

The distinction is important, at least in the US, because these two kinds of income are taxed differently. Ordinary income is taxed at the full federal, state, and local tax rates. We live in NYC and according to our accountants, we pay a marginal fully loaded tax rate of 47.62%. That means we keep about half of the ordinary income [my wife] and I generate.  More…


There’s Always a Bright Side

It’s a typical Utah Spring…one day it actually feels like Spring, and then wham! more snow.

I’m checking the 10-day forecast every couple of days, trying to figure out the exact right moment to turn our handyman loose to summerize all the swamp coolers!  🙂

But the trees and lawn and flowers look great, and we didn’t have to pay for the water.  Yippie!