Be Careful What You Wish For
This may be a little premature on the "success" side, but thanks to the support from BP, the BP community, friends, and family, I am now racing down the path of buy-and-hold rental property and becoming a landlord. Backing up 18 months, I was laid off from a good job with 17 yrs there. It was a real shock to the system as I was performing well and making the company money, but higher-ups needed to find some cash so they let go 3 well compensated employees. Being out of work, nearly 50 years old, and looking at my 401k, which I was diligent in my contributions from a young age, I realized that in my retirement I had social security as my only "passive" income and the rest was coming from my savings, which was then market dependent for growth once I stopped contributing.
Although it took me longer than I wanted, I was able to get another W2 job, but while I was looking I started a handyman business. As a younger man, I did high end remodeling and custom home building. I figured I didn't want to do that again, but maybe a handyman business could provide some extra cash, and keep me busy while I looked for another job. Well one Facebook post on the neighborhood page and I had all the work I could handle. And continues to grow just through word of mouth. However, about 1/2 of my customers from the neighborhood had me doing repairs on their rental properties. I had a couple of conversations about getting into that myself but I didn't really take it any further.
Then selling a couple of items on Craigslist, I met Joe. Retired military and a great motivational speaker. Not sure how we got on the topic, but he was telling me about his buy-and-hold strategy with rentals. Now, that I have been involved with BP, i realize he was just telling everyone about what he did in order to expand his network. Typical CL transactions are 10-15 min, get the cash and never see them again. Joe and I talked probably for 30+ minutes about rental investing and he turned me on to BP. Thanks Joe! That was in June of this year.
Step 1 was to join BP and start reading posts.
Step 2- listen to podcasts new and old
Step 3 - develop my own spreadsheet to evaluate deals
Step 4 - start reading books on rental investing and becoming a landlord
Step 5 - update spreadsheets - profits were not as attractive as before but are realistic. Good deals became bad deals, great deals became good deals.
Step 6 - learn local market. The Austin area will not have a 100K multifamily turning $2k/month in rent (thanks Brandon for rubbing that in :0)
Step 7: Pool cash and determine a plan. Long term to have 20 doors in 10 years. Short term buy 2 duplexs in 2017 - Start looking
We are now in the last week of July,
Looked at 3 properties and offer made on first property 1st week of Aug - rejected;
Second offer made - 18k below asking - counter was 15k below original asking. Past inspection and on our way to closing. Originally would not have been my first choice, but there is a lot of upside potential for this property.
Great on our way....
This week an opportunity for a better than good deal comes up for a pair of duplexes next to each other. Put in offer for both, got them.
Now I am excited and terrified all at the same time. 0-3 properties in 3 weeks and should have everything closed by early Oct. Need to close on the first one in 2 weeks.
So much for analysis paralysis - Now back to re-read the beginners guide to landlording.
Now to shift to income generation and additional savings for next year provided I survive being a landlord
