BiggerPockets

Just curious if some of the full time investors out there might be able to share some guidence on how long it took them to go from working for the man full time to living 100% on their investments?

I have been in the game a while and have build up some positive cash flow over the years but it is slow going and I want to hear that someone finally made it too the finish line.

Thanks for your time

I bet we will hear from Rich pretty soon on that topic ;)

I did it in a manner I would not recommend t, too many people.

I went full-time as an investor after just 3 months in thegame... and never looked back.

There were times in that first year that were very difficult... but I made it through.

Took me 2 years to go from part time investor, to full time investor. I did it by combining multiple investment strategies, not just a buy and hold.

It is certainly possible to make the full time transition quicker if you apply the right strategies and have the ability and time to put forth the hard work.

Trying to replace your work salary buy getting into rentals and having cash flow of $100 per month per unit would take a lot of acquisitions to make enough income to replace the 9-5.

That is why wholesaling and other types of flipping like rehabs can offer some large lump sums of cash in a much shorter period of time. The trick is getting enough education to know EXACTLY how to do these strategies and apply that knowledge in the real world.

Eddie, I hear what you are saying, but in all honesty, paying $15M for a 50 unit apartment building would be way overpriced! (That is $300k per door!)

I think that your cash flow figures are based on the fact that you have no mortgage on your properties so your net cash flow is much higher, however, for the sake of apples to apples comparison to those who do need to use leverage, your cash flow would be much less.

If you pay $40k per property including rehab, you will have invested $200k in cash. If you get $1800 per month in cash flow, that is only a 10.8% return. If you ar eall in at $30k, that is still only a 14.4% return.
Am I missing something?

hmmm 1 post, -52 influence, and your breaking the rules by spamming... even if you're program was a good one it turns me off to even look at it because of this

eddie...quick question..does this mean all your cash is tied up in these rentals, or do you do a refi to pull some out?? thanks

Eddie,
Nobody can argue with your strategy, there is nothing wrong with it, the only difference is, you personally have the ability to pay cash for them while others do not.
In the case of the later, investors looking to create an income replacement via RE investing in a buy and hold scenario, would have a much more difficult time doing so and getting enough properties to generate that income replacement.
That is why I suggested that newbies implement some flip strategies to generate capital for the buy and hold. That increases the capital and decreases the amonnt of time it would take to complete the income replacement goal.

Per your first investment, $24k all in and rents for $650 is excellent cash flow. Assumming you financed 100% of the acquisition (for apples to apples) your cash flow based on an estimtaed 50% total expense ratio and a loan at 6.5% would be $142 monthly. Taking into consideration you persoanlly used your own cash ($29k), your cash on cash is 13.45%.
If it were possible for you to get a portfolio loan for all 5 properties, your leverage ability would dramatically increase your cash on cash as you could acquire 10 properties and only have them 50% leveraged.
I have a strong inclination that a private investor may in deed be happy with an 8% return on a 30 year ammortized note based on a 50% LTV. In fact, I know of one persoanlly who buys first trust deeds and the ONLY criteria is that the note be 50% LTV or less.

hmm. well, 1 day. i lost my job, when i was learning how people invest in real estate.... and yea, i havent made anything :). its pretty hard. sooo basically if you dont want to end up homeless(on my way) KEEP your daytime job to start out. ofcourse it depends on your own market and what you invest in.