How I built a portfolio of 35 rentals and $10k+ monthly cash flow

362 Replies

Great story. Great great story. Love to hear about people taking advantage of the VA benefits too. Thanks for your service. Your family will benefit from this for generations. I appreciate this for it's inspirational value, but really two things seem to explain most of your success:

Super high savings rate on a really high income.  I guess you had no financial obligations to individuals, children, or communities beyond what 30% of your income could meet, and no time commitments either.  Saving 70% can make you really rich; most people investing that much get rich regardless of asset class, returns, etc.  Some less than you, sure.

Just posting because you made a comment that you couldn't point to one thing that has made you successful.  I can.   This discussion shows the importance of how much you invest

I just advised a client's girlfriend about to go from $50K to $220K income to live on $10K a month and save the rest.  She couldn't believe how much she'd have in 5-10 years.  She hadn't considered any of this!  I don't care what metro area anyone lives; for the most part real people are living there on way less than $100K so people earning $200K, $300K etc can create massive wealth if they live like the top 5% at even $100K a year.  I have clients doing this and they invest in all sorts of things and do very, very well.  Obviously some do better than others...but that's another story.

Bottom line for anyone reading this, savings rates over 50% on top 1% income levels will make you VERY rich in 5 years.  I have assessed the ability of folks to pull this off...and it works regardless of what they want to invest in.

@Albert Okagbue

Everything you said is 100% true. I believe taking control of your budget and savings is one of the first steps of building wealth, regardless if you invest in real estate or not.

@Jason Graves

Sounds like you're doing fantastic yourself, congrats!

@William Tiffani Smith

Check out this post where I wrote about that in detail:

Hi Anton, how bad a shape were these properties that you purchased from sellers via your direct mail campaign?  Did they require a lot of rehab (roof, siding, foundation work, serious dry rot, water damage, etc.) or was it mostly cosmetic clean up?  How much has the rehab been on average for your fourplexes?  Did you run into any major issues with the rehab and your property manager who manages it for you?

Are these properties in a good school district, average or not so great?  What is your actual vacancy percent across your Kansas City properties?

I appreciate the information so I can understand the complexities of out of State investing.  

Thanks for providing details about your valuable out of state REI experience for us newbies. Much appreciated! Linda

@Linda Thompson

I don't like buying properties with significant problems, so they mostly need cosmetic repairs or have that "dated" look. We spend on average about $5-6k per unit on rehab and sometimes another $2k or so on the building for landscaping and miscellaneous work.

Haven't had any major problems so far, in-fact my PM/project manager and me have a standard rehab SOW and materials that we use for all rehabs and make-readies.

The properties are in pretty solid B areas, so the schools are average, along with most other statistics like crime, etc. The vacancy rate is shaping up to be around 8%, but I haven’t owned them that long and the first few years are always more unstable as we replace the tenants.

Thanks, Anton.  This is very helpful!  One last question.  

I'm curious what your experience has been with acquiring multifamily (2-4 units) with tenants in place at below market rents and how you have handled that situation. Do you price your offer (NOI/cap rate) based on the A) lower in-place rents or B) post-rehab rents?

Do you give tenants notice to vacate once you own the property, complete the rehab and then re-tenant the property or just rehab once tenants vacate on their own?  What have you learned from this experience if you have tried different strategies?

Thanks again for all your great advice based on your recent RE experience out of state!  This has been invaluable information for me getting started.

I downloaded Dealcheck and looking forward to using it.


@Linda Thompson

I base my purchase on current rents and condition of the property, but I do run projections post-rehab to see what my returns/cash flow would eventually look like.

I don’t force the tenants out. We do gradual rehabs of the units as they naturally become vacant. We also sometimes offer the tenants move into one of the rehabbed units if they are ok with increased rent.

I don’t finance the rehab costs, so I don’t want to force all tenants out at the beginning and have to pay for all rehab work up-front. I’d rather use the cash flow to finance the rehabs over a longer period of time.  

Thank you for sharing this info Anton Ivanov! I am just starting out and would love to be able to develope a portfolio like yourself. If you have any tips on what to avoid when getting started id love to hear. What would be the best way to get started? Thank you for sharing! 

@David Hernandez

It's very hard to give some sort of blanket recommendation, especially without knowing you, but I'm a big fan of house-hacking small multi-family properties as your first investment/home purchase.

Originally posted by @Frank Wolter :
I did the same thing in the Cleveland Ohio area. Im 43 now and I have about 120 doors all paid off. I'm trying to learn to leverage but I'm stuck in my paid off ways. I'm now working with a lender now to leverage the 4 million I've accumulated. So I'm going to do it at 7% fixed but I hate payment ugh

How were you able to pay them all off? 

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