Realtor · Peoria, AZ · Member since 2018 · 107 posts · 26 votes
My wife and I are 25 and are looking to retire in 10 years through long term rentals. We live in the Phoenix area and have 1 rental currently that cashflows $500/month. What suggestions do you have to build enough cash flow to retire? Our "retirement number" is $4,000/month. How would you buy enough properties to do this?
To me, $4k/month isn’t enough once you factor in health insurance, etc. and retirement at 35 just seems odd to me unless you have tons of money to travel and do great things. I see boredom in your future. Keep your W2 jobs, aim high, buy as many rentals as you can, bank as much money as you can, and retire early in your 50’s. As for me, if I’m home for 3 days in a row I go nuts.
First, I want to say that you need to increase the number of 4000 a month to probably double or triple that of $4000 a month to probably double or triple that because you're not thinking about what it costs in the future to live and plus you made $9000 dollars now per month and you're going to want to live at the same or higher level.
Second, finding single family houses that will cash flow in areas that are appreciating quickly like Phoenix is difficult. You may want to look at buying some houses that need a little TLC (paint, etc) and then selling on owner financing at slightly above the current value. This will allow you to get better cash flow and you are no longer a landlord.
Hi Randy! Thanks for your input on this. I agree that 4k/month would need to increase for sure over time. I've entertained the idea of selling via owner financing and I think it's a great strategy. My biggest hangup is that I was under the impression you had to own the home outright in order to sell it this way. Is this so?