First Year on my own

43 Replies

Hello BP. I just wanted to give a big thank you to all the talent we have here in 1 place. Thought I would type up a summary of my first year working on my dream. 

January 2015- Have been licensed RE broker for 1 year W2 job 12 years. Part time RE Full time travel W2. Closed 20+ RE deals for others 1 for me previous year. RE Broker is not a career everyone would do or should do it is truly hard work nothing is given. Wake up every day and hustle. Found I love it got so busy was showing homes on lunch breaks working till 10-11pm keeping things together 6am-8:30am work all day at the W2. W2 averaged 70 hours a week RE all the spare time between.

Mid January- RE going so well had to chose W2 or RE. I chose RE. GO 100% self-employed

February- Outstanding 401K loan due within 30 days of leaving W2. Big $$$ due liquidate as much as possible to pay back loan without huge tax penalties. Get it done go down to less than $3K to my name supporting my family.

February- Wife is laid off from W2.

March- Scared... Hustle

April- Taxes Due huge $$$ again closed a few deals to cover nothing extra left.

June- Tenant stops paying rent. Long story basically in his mind his excuse is completely valid to him (lost job) so I should be able to cover rent for him. NO evict.

Meanwhile keep my head up and continue to pursue my goal of 50 deals in year 2 as broker.

June-October- Tenant rides eviction all the way through court pleads not guilty borrows money to pay into court to prolong the eviction gets very nasty threatens us and says he will ride out the eviction as long as possible then leave the day before the judge rules. Finally get him out while he is in jail for beating his wife find drug use in house $5K of rehab plus court, lost rent, and moving the wife out. NEVER rent to a previous felon they know how to use the law against you. (my fault for giving second chances, I did screen well)

September- Self Employment taxes set in again and I know this. More $$$ to the man, Working on other forms of business ownership. Work on depreciating asset schedule. Contemplating switching CPA's.

September- After saving for 2 years and losing it multiple times above buy a new to me car. 30 miles in wreck it. Ouch....

November - working the details for next rental.

Every month helping people buy sell and invest 3-10 monthly.

Taxes plain suck. I plan for them yes but I could have bought 2-3 more rentals instead of throwing it away in the mailbox.

Currently not fanciable, great credit, good income.

Almost December- Sounds scary so far but, I have risen to #3 broker in my firm. On track to close 50 transactions this year. Have rental occupied. Hired my first assistant. Still wake up every day and hustle Stay up every night and hustle. Very thankful to have our health, a loving family, a Home.

Looking back on this year a bit early. I do not regret leaving the W2. I will continue to acquire rentals. I will help more and more people. I will keep working on my dream.

Its very true nothing good comes easy. Thought I would share my success some may call it a struggle, some call it an entrepreneur. Call it what you want just don't call it easy when I'm 20 years on the other side of this.

@Justin Green , amazing story.  It would have been easy to go back to the W2 job but you hung in there.  You have also acquired an amazing amount of knowledge as well.  You have created a base to continue to grow with.  Do  not forget to smell the roses though, especially when it comes to spending time with family.  Good luck

@Justin Green   get rid of the rental.... focus on your commission income. 

Although to be fair most PDX rentals are a breeze compare to other parts of the country. but you do have to be very careful   renters are renters are renters.

You may want to switch from SFR to small multi if your desires is to still own rentals and use a PM. So you don't get caught in the scenario you just described.

and for gods sake please include my Palmblad meadows new builds in a few of your 50 sales this year.. Bonus to BP agents who sell my product  :)

@Jerry W. I was just reminded of that this morning reading Steve Jobs last words. I'm taking today off with family and went for a run this morning. Thank you.

@Robert Blanchard I work with all types as long as there is mutual respect. When someone approaches me calling themselves an investor I usually run (kidding but the term is too vague like most feel about RE agents also). I find the wealthiest people don't even say the word and just live the life of one. 1/3 of my clients do repeat business with me so Yes they are investors also.

@Jay Hinrichs you are telling me the same thing my father in law says. I will move into multifamily down the road. SFR's are the building blocks for now (be bankable then sell a few SFR's to get down payment for the larger assets). I am now using a PM and do not know the tenants they are hands off after the above expensive lesson. I also thank you for taking my newbie calls about previous overpriced dirt (newbie agent dirt deals we have to learn somewhere) I did put a few together finally. I am focusing on the Agent business primarily and the new goal for 2016 is 75+ transactions. If I help enough people I will get whatever I want. Shoot me your Palmbad stuff and Ill be happy to bring some buyers :)

Thank you all for the support and comments.

@Justin Green  its funny in dirt deals... the sellers usually look at what lots are selling for then figure out they have X many and multiply that by full retail to come to their price.

Just put Palmblad Meadows LLC in the mls search.. its in Gresham price 350 to 370k.

27 homes 4 pre sold and 12 going vertical right now.. first closings mid dec  ( ya) 24 months from when we put it under contract.  which is not too bad for Oregon these days

And yes I read the Jobs thing as well it home for me as I am same age and grew up just a few blocks from him etc etc.  I am in Maui with my Family now.. :)  so we are stopping to smell the roses. Or Bougainvillea as it were 

it takes hustle and hard work in the beginning.  Hang in there.  

Our story:  30 yrs ago my husband and I (reluctantly) bought 4 - 4 unit buildings. Mortgaged our paid off home x 2'(first and equity) plus small seller finance with balloon.  Worked 2-3 jobs as pharmacist and nurse for over 15 yrs to pay off our buildings in 15 years and rehab almost everything. Bought 5th building at foreclosure 5 yrs ago.  Lots and lots of work and sweat.  Now: we're 72 & 77 yrs old, live in paid off home on a lake in NH and live 6 mos in Paid off condo in Fl.  Still actively working our buildings for retirement income. Screen tenants meticulously.  Continue to fix up the properties. Would like to sell but taxes are the Big Issue. 

Thanks for sharing your story! I always find stories like this motivating, hard work and having the right mindset is the key to success and you sir have that. 

-Sam 

Justin,  I left my w2 2 years ago.  The ups and downs are so stressful.  i thought I was finally out of the mess, and two weeks ago told my office of 5 people that I couldn't pay them anymore.  Not fun.  I am with a previous comment.  Focus on making cash right now, and the equity will come.  

Hi @Justin Green Thanks for sharing and congrats on your grit and determination.

Time with your family will return much more than any property.

I am at that point (in between contracts as an IT Project Mgr) of being in business for a little less than 3 months. However, I've gained some momentum and have continued to grow my business and starting to see the benefits. I still have yet to complete a deal in my many partnerships. However, I am on the brink of at least 1 deal and see the potential of many more closing over the next couple of months.

Without a job and any savings to speak of, it's hard for me to give up the J O B for hopes. However, I feel I could make as much or much more in just several months doing real estate. Determination, a level-head, a creative mindset, good resources and networks/partnerships, and a plan 6 years in the making should get me to a better point a year from now without a job. 

Congrats and much success in the future. You should be worlds away a year out from where you're at now.

John

Wow! I lnspirational story. How steep would you say your learning curve is?  Haha!  Straight north I bet.

When I look back at the tough times in my life, I usually am very proud of getting through it. Perseverance is all you need right now. my guess is that it won't be long until you stop lIrving by the skin of your teeth.

I'd love to see this same post next year...but you need to tell us how you've met your goals and overcome adversity.

Good luck to you

Way to go on making it through your first year! Your post has made me both scared and inspired at the prospect of leaving my W2 someday. It's good to hear real stories about how hard it can be. Thanks for sharing.  

Thanks for the inspiration. This was a timely read for me as my husband just lost his job and we decided it was divine intervention for him to pursue real estate full-time (something we had talked about but weren't quite ready to pull the trigger on). We are only in our second month and trying to hustle. It's hard because I am doing a lot of the work as well (playing off our different strengths) but I still have my W2 job and now we are expecting a baby (more expenses!). This was encouraging to hear as yesterday was a particularly rough day. :) Keep us posted on your own personal successes. 

Originally posted by @Helen Johnson :

it takes hustle and hard work in the beginning.  Hang in there.  

Our story:  30 yrs ago my husband and I (reluctantly) bought 4 - 4 unit buildings. Mortgaged our paid off home x 2'(first and equity) plus small seller finance with balloon.  Worked 2-3 jobs as pharmacist and nurse for over 15 yrs to pay off our buildings in 15 years and rehab almost everything. Bought 5th building at foreclosure 5 yrs ago.  Lots and lots of work and sweat.  Now: we're 72 & 77 yrs old, live in paid off home on a lake in NH and live 6 mos in Paid off condo in Fl.  Still actively working our buildings for retirement income. Screen tenants meticulously.  Continue to fix up the properties. Would like to sell but taxes are the Big Issue. 

 Hey Helen, this is just a thought, but have you thought about selling with owner financing to a younger investor? I wish I could say I was interested in your properties haha, but I've been focusing on finding properties in my area with owner financing. The benefit to you, from a tax standpoint, is that you since your capital gains are going to come in incrementally over several years, you'll be able to write them off more efficiently than if you had to figure out how to write them all off in one year (per a traditional sale.) Another big benefit is that you receive more for your property than through a traditional sale, because owner financing motivates investors. You also get that monthly check in the mail, which is nice. Because of your age, I would look for someone who can make a down payment of 10-20%, monthly payments with a 20-30 year amortization, and a balloon payment after 7.5 years of monthly payments.

Kind of a win-win. Wish I could find more retiring investors in my area interested in a deal like that, but maybe you'll find someone like me interested in buying your properties :)

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