Buy and Hold strategy. Am I going about this the correct way?
Ok so a little bit about me. Im 32 live on Long Island (ny) I currently own a single family home that I live in. It has a basement apartment that I currently rent out for $1300 a month.
House is probably worth $215k-$230k on the conservative side. Have about 12 years left on a 15 yr with $160k left. Mortgage and household expenses cost around $3k a month
I also run a landscape construction business with my father. However its getting harder and harder to compete with all the hacks and I feel that the glory days of 15 years ago are over. Id like something more stable for retirement. And I would really like to relocate to SW Florida in 10-15 years.
Heres my "plan" keep paying down my house as I currently am. Somehow purchase a rental property in my area either with my brother or my best friend who I would consider a brother. If I do it with my brother he would probably occupy the main space like I do and we would rent out the apartment. If I did it with my friend we would simply rent out both spaces. Im really not looking for a huge cashflow per say Im looking at them in the sense that if I can have them payed off in 15-20 years and have the rents cover the entire house in 15-20 years I can collect the rent free and clear for the most part (my half in this case) or build up enough equity in the first rental property to borrow against any appreciation or increased value from repairs and upgrades to purchase another similar property.
In the long run I'd like to be in florida collecting 5-6k of rent in addition to any money I would be making down here and maybe start investing down here as well. I understand Ill have to pay either my brother or friend or a property manager at that point but thats ok.
I understand that finding a great property like my current home is key. There homes on my street that have sold for under 150k (needed probably 50k) in repairs but I could probably do 99% of the work myself and also keep my guys busy during slow times doing upgrades on the house. But for what I am getting for rent from my basement at $1300 and I know I could rent out the main part of the house for at least $1700 I would think the house would cover itself minus any repairs or vacancies that will occur (hopefully there will be some small cashflow to be able to save for those, if not at least I would be splitting the cost with someone)
As far as financing the next purchase I may be able to buy the house cash at a discount (with money borrowed against my fathers home which he owns free and clear) and then take out a mortgage in my brothers name.
I also have another contractor friend who is interested in partnering up and doing some flips. I would probably try and use my portions of those profits to invest in more buy and hold properties.
I know I probably missed some details but as a rough plan does it sound plausable?
Any comments?
ps. been doing a ton of reading on here and the books recommended on here as well.