[INTJ] INTJ's and Real Estate Investing

INTJ's and Real Estate Investing

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This is a discussion on INTJ's and Real Estate Investing within the INTJ Forum - The Scientists forums, part of the NT's Temperament Forum- The Intellects category; I'm not expecting a lot of responses here since INTJ's on the whole tend to, in my experience, be fiscally ...

  1. #1

    INTJ's and Real Estate Investing

    I'm not expecting a lot of responses here since INTJ's on the whole tend to, in my experience, be fiscally risk adverse.

    However, the Te in our type also makes us very keen on seeing and capitalizing on opportunities for material gain. I'm interested to know if any INTJ's (or, technically, other types) here have forayed into real estate investing. Have you ever flipped a house, bought and rented, or bought for appreciation? If so, do you have any success stories? What about horror stories, with botched contractors, going over budget, struggling to close, or taking too much time? If you've given real estate investing a try and enjoy it, do you feel your type led you to a certain kind of strategy in what sorts of investments you decided to pursue and how to do it?
    Luck thanked this post.

  2. #2
    INTJ - The Scientists

    I can't comment on the riskier versions you mention but I do own residential investment property as a long term investment and as a property manager can comment on the daily nuts and bolts of managing it if you have any specific questions.

    A few random observations:
    - When you move out of your own house and rent it out, it's almost a guarantee that at least one thing working the previous week will break down when you move out i.e. pool pump, A/C, stove.
    - When you have more than one investment property in a given market, the chance of them being vacant or all having issues at the same time is pretty high.
    - When you're a tight arse you will pay more in the long run.
    - If something seems too good to be true...it is.
    - People's words are absolutely not to be trusted. Tenants who say they will do gardening don't...they just don't. Don't leave it to contractors to do what needs to be done to see a job to completion. Follow it up! Ask for updates. Go and check on progress.

    A large proportion of the people I deal with clearly have no follow systems in their lives or businesses. Most of my job is follow up and doing so in a way that doesn't unnecessarily damage their ego and therefore our working relationship. Tenants who don't report maintenance or forget to pay the rent (and usually it is simply just forgetfulness). Contractors who half finish a job or forget it or lose the work order. Owners who 'forget' to get back to me about maintenance ... and even tenant applications!

    If INTJs are indeed risk averse, then yes it has affected my investment strategy. Buy and hold and only so much as I am confident that I can pay back - no maxed out leverage for me thanks. Our local market is in free fall at the moment and people who maxed out their credit anytime prior to the last 12 months on property purchases here are in a fairly sticky situation right now.

    I think that if you are conscientious and sensible about it, have reasonable expectations, and insure appropriately, then property investment (and any other type of investment) is fine. It's when people think they can make unreasonable amounts of money quickly with little personal exertion that problems crop up.

  3. #3
    INTJ - The Scientists

    I successfully flipped a couple of houses. The market timing was right. I bought fixers. The worst houses in a good neighborhood with good basic architecture and big backyards -- both had plenty of good to work with after the ugly was removed. Half the battle is finding these never been remuddled old treasures and negotiating hard to get a very good price to work with, giving you room to pay for unexpected things should they come up. Of course you get inspections in the hope that nothing major does come up. The second half to getting it done is to micro manage contractors and manage costs. It isn't enough to get a good price for work done to the house. You must supervise them and really scrutinize their work and stand your ground when they make mistakes. When the plumber installs the toilet in a way where the bathroom door now no longer closes and he says to you 'but that's okay, right?' "NO!"

    I approach the design angle from a logic perspective: remove the five ugliest things about the property and additionally give it the five things that people tend to really like. I seem to have an advantage in that I 'see' both what is possible and what should be done. I have no problem tearing down walls etc. My SO at the time gave me the 'are you sure' look as we began taking down two walls to incorporate three small rooms in a large room on one of the properties. I just intuitively know it's right. I see my INTJ nature in how I approach flipping generally. However I have a strong need for beauty that helps the process which I don't necessarily see as coming from being an INTJ. I wonder if that has more to do with the 4 wing on my enneagram type (5w4). Not sure. I expect I'll flip more houses in the future when I'm not as busy as I am now with other ventures.
    GypsyDays and Insider77 thanked this post.

  4. #4

    I live in Australia. So no.
    The real estate market here appears to be quite overvalued and was not impacted by the 2008 recession. Plus the relatively high debt to income ratio. We are due for a correction and any Australian putting significant money behind real estate at this point in time is foolish. With one of the highest household debt to GDP ratios in the world, future growth of the market must depend on this ratio increasing. And that is unsustainable.

    Last edited by Morn; 02-09-2016 at 04:06 AM.
    GypsyDays thanked this post.

  5. #5
    INTJ - The Scientists

    I haven't flipped a house, but I am living in one that I designed and had built. Down to the number and placement of our insane number of light switches and electrical outlets. I even planned a light switch above my bed so I don't have to walk in the dark. And a little room in the bathroom for the toilet :D

    I wanted to buy an apartment, have my mother in law rent it, and then move into it when we retire. By then she'd most likely be dead. Maybe we'd have to rent it to strangers if she died too soon. We have the money for a down payment, and mother in law would basically pay our mortgage. But my husband, the likely-ESTJ finds this too risky. I don't see real estate investment ever getting less risky than that, so I guess we are out.

    I live in a new street, all the houses here are new, lots of different builders. One family here hired a builder that went bankrupt before the house was done. Their house stood for months, just the skeleton open to the elements in the middle of winter. No other builder wanted to touch it. A few other families here got burned by zoning laws and the elevation of their property. They had to pay out the nose for a special foundation. Another guy here has moisture in his house and they don't know how to stop it. You can see the brick work from the outside is all wet. But he's an asshole and deserves it :P
    Luck thanked this post.

  6. #6

    These days investing in purchasing real estate property means to go in loss. Best thing is to invest in real estate companies by way of purchasing shares. With time if that company's project grows well, you will definitely receive its returns at regular intervals. In some cases you have to wait for years also.

  7. #7

    I own a duplex, I used to rent both apartments but I took one for myself last year. Bought it from an old lady who thought she was on her death bed for 100k. I put 30k worth of repairs in it and I intend to sell it 180k in a couple years.

    There were A LOT of repairs to do, good thing my father was there to help me with it because construction is not my forte.

    Wouldn't say I had horror stories, but I had troublesome tenants that kept looking for trouble with me. I managed to get rid of them last year when I took over this appartment.

    Hopefully I can make a good profit out of it and buy my dream house after.

  8. #8

    I think there are a couple of key issues are in play with making it work.

    1). How much capital do you have to work with? If you are taking out loans, your return will be hit by interest. You can have a great year or couple of years and have it wiped out in a month. if you are playing with your retirement funds, I'd be careful. You have to factor in taxes where you live as well. I assume most places tax income from renting or flipping a house as interest income which is taxed at 15%. If you live in a locale that taxes it as personal income, your profits will take an even bigger hit.

    3). What market are you in? The most difficult thing for me to get my mind around with real estate is how much is out of your control. A LOT of people lost their shirt in the housing crisis. I realize that is an outlier, but most of what happened to them wasn't because they did anything wrong. I would say know the trends, neighborhoods and economy inside and out where you live.

    3). How 'handy' are you and do you enjoy it? If getting off of work after a long day are you looking forward to going to install a new toilet? If so, that is a huge plus. You can save money by doing the work yourself, and if you aren't miserable doing it, all the better.

    You can also look into REIT's as a means to invest in real estate. Or index funds that deal with real estate. Your returns will likely be lower, but your exposure will be more spread around.


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