First Rental--Seeking Stories of Failure and Success--No Hacking

First Rental--Seeking Stories of Failure and Success--No Hacking

Seattle · Member since 2019 · 1 post · 0 votes

Hi there,

I've been managing multiplex apartments averaging 30 units each for the last 4 years as an onsite manager/ roaming property manager. In that time I've managed to save enough money, with the help of a partner, to purchase my first rental property. We're currently in the financing and deal finding stage of things. 

Our Ideal house would be a single-family residence, under 250k, 2-4 bedrooms, within 1-hour commute of my current place here in Seattle.  I have already identified a few markets that look promising and am just waiting for the right property to become available. I should also note that living on site is not an option for me or my partner at this time, so no house hacking. 

My plan is to repeat this same model every 1 or 2 years until I reach a portfolio of 10 single family homes, then upgrade to a multiplex of no more than 15 units. Because of my experience as a manager, I will manage all properties myself with the help of outside vendors when necessary. 

My question for you all is three-fold: 

1. Are there any bigger pockets members currently in the area who are somewhere between 3 and 6 years into a similar plan of my own? If so, how's it going/what's story?

2. What sort of financing did you use to purchase your first property given that you weren't able to house hack? 

3. How did you avoid tieing too much of your seed money up during that first deal? 

Looking forward to hearing what you all come up with. 

Thank you in advance. 

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  • Rental Property Investor · Augusta, GA · Member since 2017 · 825 posts · 278 votes
    7y

    Hi Trevor,
    My situation isn't identical to yours, so take with a grain of salt. I used conventional 25% financing for the first rental that I didn't live in. And there wasn't a workaround with that to keep my seed money out. The next one, I did a BRRR, but ended up leaving around $10k in the deal after refinancing (not bad, not a home run). With more experience, more people have been interested in partnering with me for short term or long term private money. I would not have wanted to take their cash until I was confident I could protect it and use it well.
    It's great that you have a plan. The thing I've discovered is that this isn't a linear business. The first deals are slow, painfully slow, and then if you treat people right and keep consistently working, you end up with more opportunities than you can juggle without scaling up. You might choose to just get in the game with the conventional loan, and then learn from there. Good luck, whatever you choose!
    Amanda

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