I am also into residential real estate and was wondering why you chose to go the cash route especially when rates have been so low. For instance, in the properties that I am currently in business for, for 20% down I able to fetch a 30% ROI after mortgate + all fees incl. property management, taxes, insurance, etc... For the same properties, if I would go all cash, my return would be closer to 11 to 12%. Of course with the mortgage approach, it tends to be a bit slow (i.e. a mortgage at a time) and longer to scale to the same levels of in terms of absolute monthly returns since my monthly cash flow is lower in absolute terms.
I tried, and I even looked at hard money loans, but at the time I couldn't get any (even with an 800 credit score and never missing a payment on anything in my life).
Lenders were hesitant to loan for investment properties, especially in condo complexes with low owner occupancy rates.
In 2012 I learned that I didn't look hard enough when I a buddy told me he 'had a guy' that he'd get loans from for the same thing for 20-25% down. He said it was a bit shady and the rate was a bit higher than a conventional loan, but it did the job.
And to be honest with you, in all of my investment I've never crunched the numbers to determine exact ROI. I always ballpark it in my head and go with my gut. I'm sure it's more risky and I'm probably leaving money on the table, but to me investing was a hobby and that kept (keeps) it fun. I do it because I love doing it.
Also, it may be holding me back, but I don't like debt. The last three homes I bought cash, as well as both of our cars. Hell, I'm even self-funding my business. I find it gives me a lot more freedom albeit a lower return. But to me it's worth it. For example, sure I could grow my business faster with funding, but I've been working on it for two years now and still love it. In fact, I'd do it for free. You can't put a price on that.
I am also into residential real estate and was wondering why you chose to go the cash route especially when rates have been so low. For instance, in the properties that I am currently in business for, for 20% down I able to fetch a 30% ROI after mortgate + all fees incl. property management, taxes, insurance, etc... For the same properties, if I would go all cash, my return would be closer to 11 to 12%. Of course with the mortgage approach, it tends to be a bit slow (i.e. a mortgage at a time) and longer to scale to the same levels of in terms of absolute monthly returns since my monthly cash flow is lower in absolute terms.
Interested in your thoughts.