Trading up after your Single Family Rentals have appreciated : Multi-family or Multi-Unit Commercial?
In the forum discussion, Rich Dad vs David Remsey, someone had mentioned a book called the "Wealthy Code" by George Antone so i decided to order it from Amazon.
There is a chart that shows three different categories.
1. Cash Influx
- Flipping, Foreclosure, Rehab, Wholesale
2. Cash Flow
- Income Properties, Paper, and Businesses
3. Appreciation
- Forced Appreciation, Timing market, normal market, SFRs in appreciating market.
The interesting part of the book is that once build up wealth and equity with your single family homes in #3, you want to trade for a better yield income properties. #2. Gary Eldred writes in his book "Investing in Real Estate" that a million dollar real estate rentals paid off clear and free should yield you anywhere between 5% - 12% passive cash flow: $50,000 - $120,000.
For those of you who started out building equity in your SFRs in good neighborhoods, what type of income properties did you trade your SFRs for?
I personally am not a big fan of multifamily, duplex, triples, apartments and the like, but do have interest in possibly trading my best SFRs for 5 unit office warehouse or retail strip in Forsyth County for better yield and passive income. I was wondering if any other individual investors here in Bigger Pockets have taken this higher yield buy and hold path by trading your SFRs?
Question.
1. If your SFR investments have appreciate 100% from its purchase price, would a trade to higher yield income properties be a wise move?
2. How many of you actually have $1 million equity in your real estate investment holding yielding $100,000 or greater passive income and what type of real estate investment do you hold to get this yield? What was your investment strategy getting to this level?