How many doors do you own/goal?

13 Replies

Hello BP

I've read a number of posts and discussions, and come upon this phrase a number of times. How many doors? Could someone confirm if it means door per SFR, or multiple doors for multi-family units like 4 doors for a fourplex?

Terrence

@Terry Lao Yup, @Austin Fruechting nailed it.  The only caveat is that if you look into student rental markets sometimes you'll see things listed by "rooms" because they're renting out to each student individually.  But that's really a niche deal as it's regional and sometimes requires a license to run a "rooming house".  I don't want to over complicate a simple question but just in case anyone else had run across that, I figured I'd throw it in.

My hunch was 1 door = 1 unit of cash flow. I have two fourplexes, which means 8 doors. I guess I'm doing okay, both are in Las Vegas. One netting about $500-600 per month (based on 15 year loan), other netting about $800-900 per month. When watching Brandon's webinars, he suggests netting $100 per door is good.

Also, I've been watching the multi-units activity for Las Vegas for last two years, and more closely past several months. Based upon actual monthly sales recently, see below, I can only imagine a great Apr'17, and onward for spring and summer. Add in the approval of the Raiders moving to Las Vegas, and you have a buying frenzy.

I'm an accountant/finance person by trade and analyze numbers all day. This upward spiral in a quarter that is a seasonal slow period would indicate a trend that will continue.

Thought?

Dec'16 up 3.4% YoY

Jan'17 up 13.9% YoY

Feb'17 up 5.25% YoY

Mar'17 up 11.9% YoY

Thanks all.

Terrence

@Jerry Soer

Jerry

I saw your original post about about getting starter home. There another post by person who lives in silicon valley (bay area), and talks about investing in out of state due to high cost in her area.

https://www.biggerpockets.com/forums/62/topics/434...

Everyone has their opinion as which path is best for them. I like options, the more options the better. Also, I believe the single most important aspect of the whole process is the loan. Unless you are paying all cash, then it is the loan. I have a mortgage background many years ago. I use a reverse analysis approach, meaning I do the numbers and see how much I can qualify for a loan. Then go find the property with the target cashflow or ROI that I am targeting.

I'm okay about connecting, but not sure how. Do you send me your email address? or some setup on the profile that I need to do?

Terry

"Doors" is the number of rental units ... 1 SFR = 1 unit = 1 door. 1 duplex = 2 units = 2 doors. 1 fourplex = 4 units = 4 doors. Which reminds me of a joke that my 5 year old son tells:

Why does a chicken coup have 2 doors?

Because if it had 4 doors it would be a chicken sedan.

just keep in mind folks...not all doors are created equal (to say the least.).  i.e. I prefer a few high quality doors than a bunch of cheap ones...like really nice solid core made of exotic woods with inlays, rather than a bunch of $11 HD special hollow core glorified cardboard doors. 

I don't have a goal for number of doors. I think that is a poor choice of goals. A better goal is a certain amount of net positive cash flow each year.

If you focus on a certain number of doors as a goal it may cause you to do poor deals in order to get to your number faster.

Number of doors is just one aspect for a goal. Another goal is the net cash flow per door, or ROI, or cash on cash return per door.

My goal is to have 16 doors, with over $100 net cash flow per door, with double digit returns for ROI/cash on cash return.

To date, I have 8 doors, with net cash flow about $150-200 per door, and last year with ROI of 14%.

Terry