| by Kenneth Chase | 82 comments

Don’t Buy Overpriced Rental Properties



Jul 7, 2018, 1:19 am Reply

Thanks Morris great post. This is pretty accurate.

Cesska STO

Jul 7, 2018, 1:21 am Reply

Right on Clayton, keep up with the awesome content!


Jul 7, 2018, 1:41 am Reply

Thanks Clayton, you are awesome and super intelligent.


Jul 7, 2018, 2:00 am Reply

Hey Clayton, I had a quick question for you.. if you don’t mind me asking that is.. what is your view on renting to voucher programs such as section 8, veterans, or homeless? I’ve been doing some research and looks like a great avenue to go down but then again I’m green lol so maybe you can make a video about the pros and cons of rent out to vouchers programs as opposed to individuals not on vouchers.. Thanks again! Loving the content 👍

Elisha Lomax

Jul 7, 2018, 2:07 am Reply

Great video, but where in the Midwest?

Marcelle La Day

Jul 7, 2018, 2:17 am Reply

Hey Clayton, awesome video.

Ralph Strocchia

Jul 7, 2018, 2:18 am Reply

I'm just starting to get my feet wet with real estate investing. Just a question if you don't mind answering…

Why do you calculate ROI for the entire purchase of the home, and not just the down payment? Let's say you put 20k on a down payment for a 100k home, and receive $10,000 a year after expenses. You only spent 20k of your own money. So it would make sense that your initial investment was 20k, and your yearly return is 10k, so a 50% return on your initial investment. Rather than a 10% return on the total asset.

I imagine it as if I was investing in the stock market on a dividend stock. If you have a purchase plan to spend 10k every year for the next 10 years, and the payout is 10%, I wouldn't say my return after 1 year of $1,000 is 1%. Because the other 90k hasn't been spent yet.

Sam Anber

Jul 7, 2018, 2:31 am Reply

Thanks Clayton! A lot of what you mentioned here applies to NYC market as well. Ridiculously high prices and extremely pro-tenant, stupid rules like buyer's max income limit and capped rent. Good luck refinancing or even renting the property if it's a coop! And don't let me get started on maintenance fees (HOA) that can easily exceed $600-$1000/month! I am really struggling to find my first rental property.


Jul 7, 2018, 2:43 am Reply

Great video Clayton (like all other videos in your channel). I'm from Australia and I'm researching about the american market. I'm kind of looking at condos in Orlando/FL in the $120k/$150k to start off. Later on I will want to diversify and try other markets like the ones you work on. The purchase would be in cash and I will buy a second one in the near future. For my first two properties I want immediate cashflow (no need for extensive reno) so they can be used as equity for the next deal (maybe the type of houses you buy). I know it's a big question but what's your view on my idea? Is it like: forget about it because there are way better options or, maybe it could be worth trying one and learning along the way? By the way, I'm also looking at splitting my time between Sydney and Florida for business reasons, that's why I'm looking at Orlando.

Sami Hanish

Jul 7, 2018, 3:06 am Reply

Morris can you please let me know why they’re are so many remodeled houses in Detroit on the foreclosure listings? That had me worried about trying to take on a fixer upper when I seen that.


Jul 7, 2018, 3:58 am Reply

How can you thumbs down this? It's great info.


Jul 7, 2018, 4:23 am Reply

People buying any wood framed house for 500K deserve what's coming to them…

ابو حيدر آل شاهين

Jul 7, 2018, 5:01 am Reply

Very true and accurate. So currently I'm investing 64K and getting back 9K a month after all expenses. How much is my ROI?

Calamitous Reign

Jul 7, 2018, 5:08 pm Reply

The wind made your voice sound slightly demonic.

Tommy Reuben

Jul 7, 2018, 5:36 pm Reply

Totally agree with you.

CB Ninjah

Jul 7, 2018, 6:19 pm Reply

Hey Clayton! Love your videos, they are filled with crazy awesome info on becoming an investor. I hope to get into it soon with my wife.
Question… how do you and your wife keep track of all the earnings/expenses, taxes, etc? Having multiple LLC’s , and S-Corp how do you guys keep track of all the money moving around in between your LLC’s and paying yourself? And especially when it comes to tax time. Is it as simple as using Excel to keep tabs on everything and then pass it all along to your accountant? Or do you use like a business software to track it and then pass it to your accountant? Thanks in advance!


Jul 7, 2018, 6:32 pm Reply

Should I invest in nyc properties? Since it seems like the rent there keeps getting more expensive?

Joseph Davidson

Jul 7, 2018, 1:09 am Reply

Good content. Maybe put some numbers on the screen? Thanks!

Edgar Arenas

Jul 7, 2018, 1:41 am Reply

Mr Morris, is Ohio (Columbus, Dayton) considered friendlier to landlords or tenants?


Jul 7, 2018, 2:02 am Reply

Hi Clayton you are so close to us in Spokane Wa. Thank you for all your help

Rich Life Insider

Jul 7, 2018, 2:24 am Reply

Hi Clayton. You mentioned in the video that HOA can change the rule about renting out. So do you only buy properties without HOA?

Ryan Klein

Jul 7, 2018, 2:47 am Reply

Do they still build class C housing? All the new houses I see seem to be A and B.

prabu krishnamurthy

Jul 7, 2018, 4:18 am Reply

great information. thank you. I have been watching your channel for over years now and I am in Canada. the home price is not less expensive like in U.S. I could not buy any property for Cad$60000. I went and searched in different provinces and the less expensive I found was $150000 and it is not easy to get class A type tenant. what should I do? i highly doubt that you will reply for my comments, however trying. thanking you very much indeed for the information you are providing through the channel. good day

Joseph Du

Jul 7, 2018, 4:58 am Reply

What about appreciation? Cheap houses also tend to attract…well…cheap tenants, which may translate into headaches for the owner. $50k houses only exist in ghettos or middle of nowhere


Jul 7, 2018, 5:28 am Reply

Historical stock market historical % is 8%, not 2%.

Daniel Gomez

Jul 7, 2018, 3:34 pm Reply

Great video thanks for the lesson. I just read that home prices in California are starting to crash. Just finished my third house rented it in two weeks. Net roi is round 18 %


Jul 7, 2018, 5:44 pm Reply

Great creative scenario-building content! Thank you. I am one to over analyze everything especially when it comes to finance. You can't put a price on a lot of the knowledge on YouTube.

Jim Dandy

Jul 7, 2018, 4:55 am Reply

Can you make a video on how to become a developer? lol

Robert Ritchie

Jul 7, 2018, 3:22 pm Reply

Clayton do you buy real estate with just cash? I have a rental property paid off and cash flowing nicely, am quite close to getting another one hopefully at about 8% ROI

Mario Anchondo III

Jul 7, 2018, 7:08 pm Reply

Great video! Thanks to your podcast I sold my house and purchased a 4 plex. I now house hack and don’t have a mortgage. My next step is to buy single family homes, the only drawback is raising the money.

Jesse Manenti

Jul 7, 2018, 2:31 am Reply

Your channel here is what made me want to start in rental real estate. I’m just renovating my first house and I’m gonna be ready to rent sometime in August. Do you have a video on what is important in the lease agreement or does anyone else know a good source I could use?

Charlie D-Cruz

Jul 7, 2018, 6:02 pm Reply

Awesome video! I aways enjoy watching your videos.

Timmy Leonard

Jul 7, 2018, 1:09 pm Reply

Clayton, love what you do! What are your thoughts on obtaining investment property through owner financing? I have acquired a couple sfr properties with this method. Not sure if you’ve spoke on this subject before, but would love to hear your opinion on this matter. Thank you for the inspiration and motivation! T. Leonard ( Florida)


Jul 7, 2018, 4:36 am Reply

Hoa sucks


Jul 7, 2018, 7:17 pm Reply

Hey Clayton
I have about $25000 In equity on my $160,000 home I am looking to take a heloc to buy a rental property in my Area. Here there is a large casino that is about to expand with a lot of casino workers who can’t forward to buy a home so I have good potential renters
Looking at places here at $50,000 to $75,000
Rent for 600 to 750 a month
Any advice or any thoughts


Aug 8, 2018, 10:25 am Reply

But you could buy one for 300,000 last year and sale it for 500,000 this year 🍺

David Smith

Aug 8, 2018, 12:53 am Reply

Smells like 2006…..

Humberto Alegria

Aug 8, 2018, 12:56 am Reply

Hi Cayton, wondering your thoughts on townhomes to buy and rent for cash flow? Love your videos.


Aug 8, 2018, 10:31 am Reply

Sensible investment, and I wouldn't purchase realestate for a while

Rapid FIRE Real Estate

Aug 8, 2018, 2:41 am Reply

Excellent advice, Clayton. It certainly takes great discipline to run the numbers, offer a sale price that makes sense financially, and walk away if that offer is not accepted. I've known too many buyers that get caught up in the hype and bidding wars, and completely ignore the fundamentals. Great job driving the point home!

SW 116

Aug 8, 2018, 3:39 am Reply

Is there a video regarding accounting/bookkeeping programs ?

Jacobb Clissold-Yasa

Aug 8, 2018, 6:37 pm Reply

Here in Melbourne you might be able to find a tent in your grandma's backyard for 50k haha

Ashfaq Sheikh

Aug 8, 2018, 7:15 am Reply

Great video. Makes a lot of sense.

James Walker for Real Estate

Aug 8, 2018, 1:09 am Reply

how do I find sellers or houses in distress. Is a realtor the best way

Jerry Rauch

Aug 8, 2018, 11:04 pm Reply

I was looking at buying a house in an area that's zoned commercial. The house is surrounded by businesses but across the street is residential zoned properties. I have read it's harder to get commercial loans , but I'm a cash buyer and am intending on using it as a rental. Is there any other downfalls to buying a house that zoned commercial ? Anybody have input? Thanks

Diana Fourpome

Aug 8, 2018, 2:20 pm Reply

Hi Clayton, I love your video's! It's helping us a lot! Do you have an episode on blanket loan? Do you think it is a good idea for us to use a blanket loan to purchase our first homes? We would love to start with you! 😊

UpTrend Investor

Aug 8, 2018, 3:27 am Reply

I like the point you make at 5:23, when a rental property gets overpriced, the rent does not keep up with the cost of the house. So true, Clayton. It takes discipline to remember this point especially when a bidding war starts. Great video!

Hanoy Con

Aug 8, 2018, 12:58 pm Reply

Hey Morris , do you know any good realtor in Jacksonville area .

Lily Rosell

Aug 8, 2018, 1:47 pm Reply

Clayton I have questions, please provide your email. Thank you,

Leo Gavrilenko

Aug 8, 2018, 12:22 am Reply

On your rentals whos responsibility grass cutting and snow removal ?

Leo Gavrilenko

Aug 8, 2018, 1:27 am Reply

What about the water bill?

Omair Rana

Aug 8, 2018, 1:00 am Reply

Do you have a video describing in more detail a comparison between investing for appreciation vs. investing for cash flow…Pro/cons..?

Dmitry OZ

Aug 8, 2018, 10:03 am Reply

Great video! The only question is- How do you find out the price for rent? Do you have to compare with the rent prices in that particular area or there any other methods to estimate?

Omair Rana

Aug 8, 2018, 12:39 pm Reply

I listened to your excellent podcast on how your team makes their $ on the properties. A clarification for me:

If I buy from a turnkey provider, does the price I pay include the rehab? Hence am I paying for a final product? Or should I be budgeting for additional rehab fees to get the house Rental ready ?

Steven Foster

Sep 9, 2018, 4:32 pm Reply

Hey Clayton, what do you think of lease options as opposed to renting? Do they really work well with the strategy of purchasing 40 and 50,000 dollar homes? Just trying to gauge your thoughts on the issue. Thanks!!


Sep 9, 2018, 11:18 pm Reply

I understand ROI but where do you find properties at ~&70K? They can not be found in those five landlord friendly states.

Beau Yeaman

Sep 9, 2018, 1:57 am Reply

Dude I am so thankful for people like you, not enough people sharing quality information like this. Thank you.


Sep 9, 2018, 1:30 am Reply

Great vid. Thanks for sharing. 👍

Shaima Samadi

Sep 9, 2018, 11:35 am Reply

can i buy realstate for rent in US ؟is it a good investment while i dont live in US؟


Oct 10, 2018, 10:29 pm Reply

these are such incredible videos. critical topic, concise and to the point, with no bs.

Angel Vega

Oct 10, 2018, 1:40 pm Reply

I always wanted to be a real estates investor but I never had someone to explain it so well. For that thanks very much.
I have a question. How you determine how many people will live in your rental house.


Oct 10, 2018, 4:35 pm Reply

I just viewed online a filthy dump — a cheap priced house for sale $45K: 5 bed 3 bath. It doesn't list the sq ft.
Question: Is there any property that would be too expensive to fix up and sale? Do you have limits?


Nov 11, 2018, 9:28 am Reply

I did the math real quick with a calculator. And started laughing out loud when i saw it read .0203….

brian woo

Nov 11, 2018, 7:02 pm Reply

500k in idaho ? paying to stay in the cold? no thanks.
also people spend 900 in rent for a 65k house? that's not so smart either. please show me where in the us can get you that kind of return! even in mexico you can't get that, 80k house rented for 500 at the most.

Kanga Lamin

Nov 11, 2018, 11:00 am Reply

is Baltimore a good place to use your rental strategies?

Pablo R

Dec 12, 2018, 10:04 pm Reply

I love your videos because of your clarity on the info about Real State…. I would like to have your help to invest in Detroit soon. Thanks

Dennis Noone

Dec 12, 2018, 2:38 pm Reply

when you say cash flow rent is X amount, are you talking about total rent or after all expenses assuming no mortgage on it?

Todd Dubberly

Dec 12, 2018, 6:18 pm Reply

Why are there so many complaints about Morris invest on youtube? Several investors in Indiana with dumps that Morris claims that the rehab. is complete and no tenants in the homes. Be careful and do your research.

Ramone Burrell

Dec 12, 2018, 12:38 pm Reply

Clayton, you are really out there in the field. Thank you so much.

Rogelio Acosta

Dec 12, 2018, 7:41 am Reply

Do you have any videos about what we should be looking for when interviewing property managers?

k3v tap

Dec 12, 2018, 8:20 pm Reply

wow this really changed my perspective on investing on real estate. ur right, i was thinking like ur average layman looking to get into real estate. thx mr morris for dropping knowledge on me


Jan 1, 2019, 12:55 pm Reply

Do you offer Podcast other than in Apple. Something like spotify or Google play?

Vagrant skates

Jan 1, 2019, 8:08 am Reply

A neighborhood with home values of 500k. There’s no way you could rent that home for $1500. More like $2500 plus! That said if you got a killer deal.

Agu Sal

Apr 4, 2019, 5:11 am Reply

“2% ROI, that’s like stock market level stuff.” You need to fire your advisor right now.

rodolfo badillo

Jul 7, 2019, 1:21 am Reply

the ROI in LA is really poor, no good place tu buy houses for renting


Aug 8, 2019, 2:18 am Reply

Thank you for the solid advice!

John Perry

Aug 8, 2019, 3:27 pm Reply

Excellent insight. Thanks for your continuous lessons!

Frank Rodriguez

Aug 8, 2019, 4:55 am Reply

Great insights per usual. Have you ever bought property site unseen?


Aug 8, 2019, 7:49 pm Reply

duplex? Price point

Michael the traveler

Sep 9, 2019, 3:25 pm Reply

I wanna ask you what should we do if you have a house that is 2000 dollars mortgage but what could you do too rent that property for 2000 dollars?


Sep 9, 2019, 4:08 am Reply

this is simply not do-able in california….

Gibran del Giudice

Sep 9, 2019, 5:58 pm Reply

You say cash flowing 800, 900, 1000 a month but is that after mortgage payments, vacancy, cap ex, and repairs?

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