Rental Property Investor · Nashville, TN · Member since 2016 · 179 posts · 42 votes
Hello gurus,
I am new to investing. My plan is to have 10 units/SFH/Condos etc in 10 years. I plan to buy and hold them and rent it for positive cash flow. The plan is to have something around 13k in rents from all the units
I am 35 year old and my present salary is $120k.
What should be the game plan to accomplish this goal? Please advice
Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes
10y
First, you have set a goal, which is the $13k in rents (I'm assuming you mean cash flow), and that is more than most...the defined goal...the $13k is fine.
Second, you really don't have a plan. "...to have 10 units/SFH/Condos etc in 10 years..." isn't a plan. A plan is how do you get to the $13k/month. My question is "how did you arrive at 10 units in 10 years?...and why?
Third, if it takes you 10 years to get $13k/month, you're in the wrong market...and you're doing it wrong.
What you need to do is define a more detailed set of financial goals, that involve specific income to pay off your total personal debt (profits) and your monthly bills (cash flow), and break them down to a series of "measurable milestones". Then, you need to develop criteria for a series of "steps" (properties), with each "exit" from one property becoming the "entrance" to the next property, that leads you through your milestones and to your goals. Now, you need to find a market where your "property criteria" describes the majority of properties in that market...and camp out there. This may not be "your own backyard". Simply being "where you live" is a terrible reason for investing in a market. The logic being you know that market. Well, that "knowledge" might be telling you "don't invest here". The fact that is in your own backyard is not a good reason for choosing a market.
Now, pick off your steps one by one, and you will find your way to your goals.
Don't:
1 - ...stray from your plan by chasing what I refer to as "shiny objects of distraction"...no matter how good that deal might look.
2 - ...rationalize a bad deal into a good one, or you'll get out of the game faster than you got in.
3 - ...listen to those that want to tell you that if you lose money in the beginning it's OK since you are learning. If that was true, the REI that lost the most money should be the smartest person in the world.
St. Helena, CA · Member since 2016 · 147 posts · 59 votes
10y
Thanks for your insights @Joe Villeneuve, your first post had some excellent points. As someone who can be a bit impulsive, planning and sticking to it are going to be the best antidote. Thanks for the reading list! @Anthony R.
Dallas, TX · Member since 2015 · 22 posts · 5 votes
10y
Oh true, @Jennifer Drew. I am not opposed to buying a property and living in it since it's just me now...Is Trinidad one of those neighborhood designated for gentrification? Do you think there's a [high] probability of appreciation, like what happened in SW and what they're doing with Anacostia?
Wholesaler · Tampa, FL · Member since 2015 · 168 posts · 25 votes
10y
@Chai Jonn I think you need to first define your WHY. Why are you doing this? Then you need to reverse engineer and come up with a plan to execute your goals. You got to be able to look from where you are now to where you want to be. Also, go big or go home, why not 10 units in 5 years or one year. Don't limit yourself man!
Have you considered looking into multifamily properties? You may be able to purchase a larger property and create some type of economy of scale. Have you chosen a market to look into?
@Joe Villeneuve Thank you so much for the info. Also, is there any minimum number of deals one should close to call he/she a good REI?
As far as a Realtor, I'd go with a Realtor who has purchased at least 2 rentals in the last 3 years for themselves personally.
On the turn-key provider front it is really hard to find a great one but I tend to like TK providers that do full rehabs on the properties, not just paint and carpet.