November 2013

posted in: Uncategorized | 0

This will be the first season of no company ‘famine period.’  The work has slowed now that the holidays have arrived and we begin to spend more time with our families and friends.  However, we still have some work; several mini contractual work that is keeping us busy and afloat over the winter months.  However, it will still be tight due to the year end property taxes that are owed and as the company has to begin preparing for the annual income tax filing.

You ask what do you mean by ‘feast’ or ‘famine’ periods in real estate?  These terms literally mean just that when it comes to working on properties to cash flow throughout the year.  Thru early spring to late September is when real estate is hopping.  Rental income increases, renters move or upgrade, people buy more homes in the spring and summer months, and maintenance work is plenty through this time period.

Yet, come the late fall thru March, if a real estate investor doesn’t have enough rentals or enough flip homes sold by this time, they usually struggle to keep up their comfortable life styles.  In addition, they face year end property taxes and then have to save enough to pay the usual state and federal income taxes. 

This alone is enough to deter most individuals for even investing in real estate.  But it is not as bad as it sounds unless you are always prepared ahead of time for those slow months.  In addition, that you are not doing real estate only, especially if this would be your first year in starting real estate.  It is why we always recommend that you never give up your day job until you have met what you think you need to live on and then be sure you are making that amount plus half that amount in addition for cushion.  This saves you from being a ‘cash strapped’ landlord.

So JJ and I, give thanks this year for finally having enough to get through the ‘famine period’ and to hunker down through the winter months.  We are also grateful for this time of year to be able to take the extra time off to get caught up on our office work, to spend time with friends and family, to reflect and to plan ahead, to have finally found financial freedom, and to get as much rest as we can for the next season.


Have a terrific Thanksgiving!