Re: John Reed’s negative cash flow - Posted by Sean
Posted by Sean on October 19, 2003 at 22:28:05:
John Reed’s a cynic, and he does say some common sense things and some of his reviews of some GURU’s are spot on… but believe me, you can make money on investment property… you don’t have to take NEGATIVE cashflow.
Its all a matter of how and where you are buying. If you pay full retail price for a property and pay bank rates on the money, you probably will have a difficult time getting positive cashflow in many markets.
However in other markets you can get cashflow from day one even if you pay 100% and bank rates. I would never recommend a beginner pay retail on an investment property… just because it limits your exit strategy if you find out you don’t want to be a landlord or that REI is not for you.
Remember, last I heard Reed lost his shirt in REI years ago, and hasn’t been an active investor in a long time… if that has changed someone please let me know… and its not that I don’t think you can learn from someone who has failed, its just that I wouldn’t take their word as the be all end all on how to succeed… knowing how/why you failed is good… knowing how to succeed is better.
Oh and his analysis of Russ Whitney being a scam artist are indeed spot on.