When should I stop buying?

22 Replies

I have been fortunate enough to have built my rental property portfolio quickly over the last year. I love real estate investing and am always very hungry for the next deal. At this point however, I am unsure of when I should take a break from building my portfolio and start enjoying my cashflow. My question is, what made you decide it was time to start enjoying instead of reinvesting everything to build? I initially thought I should build my portfolio forever, but after reading books such as “Lifeonaire” and “Cash Flow Forever” I have been questioning if I should start paying down some of my debt. Do you think it would be a good idea to get a loan on some of my paid off vehicles in order to get the down payment for a large multi-unit property that will cash flow from day one?

The answer to this question will depend on each individual.  I have a brother that would still buy even though his health is failing, because he enjoys it.  My other brother is sell out because he wants to retire. 

I am the youngest and still am in the building mode. My goal is 25 SFR and 50 units in MF. The reason for the difference is I enjoy owner financing the SFRs to great renters and is very profitable. I want 50 units in MF because the ease in consolidated maintenance and management.

The key is to buy with cash flow in mind.  If you do not need it now, you could use it to pay down debt or put away for the times when things do get bad.  (they can happen- when you are doing 2 evictions and 2 others move out in the middle of the month cash flow hurts).  

Remember cash in reserve is the best insurance for success.

@Jeremiah Ashe this is something I struggle with too. With a rental portfolio that pays $100k a year I often fantasize about kicking back and traveling the world, or using all of the cash flow to pay the properties off and then really living it up with the cash flow. 

But then a great deal comes up, and I remember that it's too much fun and too hard to pass up another high ROI net worth building property. I realized I'm a deal junkie and while I'm still having fun I plan to keep buying and building.

You know what will work best for you, I would suggest paying off any consumer debt though, I did this a few years ago and it's great to not have any consumer debt, just mortgages lower than 50 LTV at super low interest rates.

Congrats on building a successful portfolio, and I think it's fine to give yourself permission to take a break or keep building, whichever seems right to you. 

@Jennifer Beadles Deal Junkie perfectly describes me too! It is so hard for me to turn down great deals that seem too good to pass up. Ultimately I feel like I am going to keep buying because every time I tell myself and my wife it is time to take a break, I run into something that gets that fire burning bright again. I am glad to know that it happens to all of us! This game is just too much fun to stop playing!

@Ron_Flatt. Thank you for your response! You helped me realize I need to increase my goals!!

I hope to some day have this problem. I set a goal of having 10 SFR by the time I retire in 8 more years. I looked at what my Social Security, pension, 401K, and Roth would bring in and with 10 rentals we should be well above the income level we have now. I figure we won't be rich but we shouldn't have to worry much about money when we're retired. Buying property is addictive and we might change our goal as we get closer to it. I could see expanding this to 20 or even 30 properties or even looking into some MF properties at some point. What's exciting it that just a couple of years ago I didn't even think where we are now was even possible. Who know where this will end or what will be possible a few years from now if we keep going. This is why I love doing this stuff. You can do as much or as little as you want. If you want to have an extra $10 or 20k a year coming in or if you want $100-500k coming in, it's up to you. I only wish I would have started doing this when I was younger.

My mortgage broker and her husband have 3 rentals and they have no plans to expand. It brings them some extra money and they use part of it to pay for a place they bought on the coast in Mexico.

My wife's former father-in-law has 5 SFR rentals and he's in his late 70's. He just bought 2 houses last year and uses the money from those to help his son pay for private school for his grand kids.

So when to stop buying is a tough question.

@Alan Pederson It seems like you are making progress towards your goals! I noticed the same thing one day when talking to my financial advisor. They were going over with me how my 401k and roth IRA were doing over the last year and quarter and they showed me a return of about 4%. Fortunately, I had already started real estate investing at that point in time and was already getting higher returns and more money with less investment. Not to mention, I get to use this cashflow now, instead of thirty years from now when I have reached the point of retirement. I don't know if becoming "rich" is my goal, but I do like the idea of being able to cover all my expenses and continue to save as well. It is nice to hear what other's plans are, and how they have come to those decisions.

Originally posted by @Jeremiah Ashe :
I have been fortunate enough to have built my rental property portfolio quickly over the last year. I love real estate investing and am always very hungry for the next deal. At this point however, I am unsure of when I should take a break from building my portfolio and start enjoying my cashflow.

My question is, what made you decide it was time to start enjoying instead of reinvesting everything to build?

I initially thought I should build my portfolio forever, but after reading books such as “Lifeonaire” and “Cash Flow Forever” I have been questioning if I should start paying down some of my debt. Do you think it would be a good idea to get a loan on some of my paid off vehicles in order to get the down payment for a large multi-unit property that will cash flow from day one?


I had this same issue after investing for a couple of years.  I had started with a goal of 15 paid off properties.  Unfortunately, I left my plans behind and found myself unable to say no to what I termed a deal.  I was addicted and thought I was invincible.

I ended up with 59 single-family properties and found myself miserable.  I was buried in paperwork for the properties.  It was not what I had originally envisioned and it soon impeded on my role with the company I had founded.

I will make a long-story short.  Be crystal clear as to why you are investing and continuing to build your portfolio.  If you change your goals and decide to keep growing, be aware that you may need to hire help.  Hire in the positions and for the items you don't enjoy and want to get off your plate.  As your portfolio grows, your time that you have to spend with it grows and you will want to hire, i.e. assistant, accountant, manager.  

Today, my portfolio looks completely different than when I started and I have a clear goal at the start of each year of specifically what I will and will not buy if I choose to grow my portfolio.  This month, I have turned down multiple deals that I would have purchased in the past because they simply were not good enough for me to violate the plan I made at the beginning of the year.

Hope that helps ~

Stop buying when its no longer fun 

@Jeremiah Ashe - this is the best possible problem you could have. And obviously, there is not really an answer. 

I would say continue to build until you can passively fund the lifestyle you want. Whether that's a $40k per year frugal lifestyle or a $100k+ per year lavish lifestyle. 

If you love doing it... then never stop! You can enjoy the cash flow, but continuously look for deals. 

I have no idea about your portfolio, but you'd have a hard time going broke by paying down debt. If you had great cash-flow and low debt costs, why not pay off one, then acquire new one. If you have a big portfolio whats the overall health look like? Maybe get rid of some the under-performing ones, pay off some of the low balance ones, and take on some new debt?

@Chris Clothier

You make a very good point.  I have been growing, and as I grow the paperwork is also starting to add up for me.  That is one of the things that I had originally overlooked.  Also, doing showings of apartments takes up the most amount of my time.  At this point, I am still able to manage everything while still working my normal job, but it is becoming harder to manage on my own as my number of units grow.  My wife is considering taking on a larger role in our real estate investments which I believe will help significantly.  

I would love to start to hire people to take over some of things that I enjoy the least.  However, It has been very hard for me to find anyone that I believe would put in the effort and enthusiasm that I do.  How did you start to find employees that were able to help you grow?  Thank you again for your detailed response!

@Craig Curelop

I really like your way of thinking.  I saw your podcast and think you have some great ideas!  To see someone so dedicated is such an inspiration!  Right now I feel like my biggest obstacle is going to be finding the right people to help me build.  I need to figure out when is the right time to bring employees into the business.  I think that I am doing well managing everything right now, but as things grow I am starting to feel as though I might be stretching myself thinner and thinner.

I also need to figure out what are my lifestyle goals.  I believe that somewhere in between frugal and lavish would work just fine for me.  My biggest want is to be able to step away from work multiple times a year and take multiple "mini retirements" with my family.  As I move through life, I have come to realize that family time is what is most important to me.  Hopefully as I progress with my real estate goals, I will be able to figure out how to incorporate more family time into our lives.  Thank you so much for taking the time to pass on some of your knowledge!

@Mathew Paul

I think I am having way too much fun with it!  Never in my life have I been interested in something like I am real estate investing.  Every new deal lights a new fire under me that makes me what to build more and more!  I have started to notice that some things (like showing units) have become less fun than when I started, but still not bad enough to make me stop buying.  Thank you for your response!

@Matt K.

This is another problem that I have struggled with.  My original plan was to build enough that I had a nice amount of monthly cash flow, then use all that cash flow to pay everything down quickly.  Every time I feel like it is time to start doing that, however, I find another deal that makes me keep buying.  Also, I start to think that it will take away from my return on investment.  I have eight conventional mortgages and one commercial mortgage at this point.  I also have two properties paid off.  I had been telling myself that once I reached ten conventional mortgages, then I would have to pay one off at a time before I would be able to get another mortgage.  Commercial buildings changed all that and give me a better return thus far.  I don't think I am big enough to get rid of my under-performing units, but that is definitely a great idea for the future.  

At what point did you decide it was time to pay down debt vs. continue building?  I am very open to being highly leveraged because my main job gives me a fair amount of wiggle room.  Thank you very much for taking the time to respond!  

When my wife and I got started the goal was 10 " Doors " that were paid for and enjoy the cash flow for lifestyle and retirement enhancement. Well that goal has been reached recently and we are still having fun doing it so now we are thinking 20 paid for all professionally managed. At the rate we are going that leaves a couple of years to figure out the next " goal ". As we get a little older and start to think retirement we do discuss backing off a bit, then i'll be on auction.com and lean over and ask if I have 2500.00 for a bid deposit, lol   Just to much fun playing the game and dealing with the challenges. We have had lots of employees over the years and we do have a strict rule, no direct employees" and will have great property managers make our portfolio as passive as possible. 

@Jeremiah Ashe

The great thing about being a long distance landlord was that it required that I put systems in place so I'm not doing everything. 

You may need to find systems that will make management easier while still being able to expand. This could mean hiring property management or just a leasing agent.

"When should I stop buying deals...?"


I definitely agree with everyone, this real estate thing is addictive. I started with buying the house next to me this year out of foreclosure and the next thing I know I own 4 more. I’m working on a deal now that will double that the first of 2018! As long as the numbers make sense and it’s fun, I say keep buying

Congratulations...on both the portfolio growth and on recognizing the need to align your investing with your goals.  Many of us have goals around family, friends, faith, relationships, health, fitness, and other personal goals that inadvertently get put on the back burner for financial matters.  I work 60+ hours a week at my day job and I am the proverbial pot calling the kettle black.

I'd recommend to start thinking through what you value in life.  Sit down with your wife and write this stuff down.  Then begin making daily decision that align with those values/goals.  Knowing what you want provides clarity to questions like you are asking.

You may also be interested in the book Your Money or Your Life.

You will find that life is not linear and your decisions and goals will change over time.  Congrats and good luck.

never stop buying! Buy everything then sell it back at the height of the market. Lol.....JK of course. 

@Jeremiah Ashe  I am blown away when i read a question like this.  Its so deep. And so wise if I may say and i think once you hit a point you need to ask that as the blackole of acquisition and consumption can be .  Im a full time real estate investor. My goals have transitioned greatly over the last 2 and 3/4 quarter years.  Coincidentally around the time our daughter was born.   It initially shifted my into high gear than low gear then somewhere in the middle.  I tried not working, i was miserable . I wasted time trying to optimize things within my household ( that have little to no net benefit) .  If you aren't using them its amazing what you can do with virtual assistants , property helpers etc.   I don't like day to day management stuff but usually, with mobile home parks, you need to be vertically integrated.  Im setup where most customer responses get answered without me.  Typically the important issues get bumped to me and its structured that way on purpose.  I found I like to have an iron in the fire and one project going on at a time because when stabilized, they don't take much time once systematized etc and having a project that I'm working on gives my life satisfaction and meaning. 

What i have really drilled down to the last year has been not number of units but its what I can do in about 20 hours a week. The range might be 15-25 realistically. And there are weeks it might be 2 hours and maybe even the 40 hour work  week.  So as bizarre as that sounds that is what I have found that gives me the best balance.  I try to not work until 12 ( because i spend the mornings with my family.  Then i try to stop at 5 . No work on weekends.  I like to work at starbucks.  Most everything i do is on a computer or phone much of the time.  I also spend a good chunk of time prospecting for new opportunities etc so could ultimately probably reduce the amount to say 5 hours a week of just maintenance if i just said to hell with it , I'm done.  I like that I have that option though i don't see that card getting dropped for a while . Not working for a few months ironically, taught me the value and meaning of work ( you'd think it would be the other way hey? ! 

No its not a perfect system , emergencies happen, issues come up, and i know taking care of the business ultimately takes care of my family. So i will make sure try and take care of things if there is a problem.  I also depend a lot on awesome people . So that really makes me question if i should say do this thing or do that thing and always trying to figure out a better way to do things.  Not trying say i have it made but this for me, has been such a blessing to find that i need to spend a certain amount of time working because thats where i get my fulfillment.  I think the best time you ask your self is when you have about enough money to cover your expenses but not being leveraged more than your comfortable with ( also keep your reserves in mind). 

Ill probably need a bit more money in the future as our family gets older and maybe bigger if we want to travel for say a month so that just means another property.  

I also strongly believe in deferred gratification so when starting out you might not go out weekends to study and save money but as you get older you might get the 300k house instead of the 500k k house because it makes sense.  Or holding off on getting the boat this year to get it next year when your debt position is lower etc.

I also don't want to be living on borrowed money so for us, that is definitely a consideration on anything we do .  Have  owed a lot, have owed nothing, i think I'm somewhere in between. I know i can optimize my returns by being leveraged to the hilt but you hit that wall and ask if thats what its about . 

At some point in my life (embarrassingly ) remember watching Julia Roberts Eat, Pray, Love.   I don't remember much about it but i think there is def merit to the concept of balance ( might be way off base on that movie.  Work a little , spend time with the family, and spend some time improving yourself ( emotionally, spiritually,intellect). 

Id also like to add , I started in real estate 10 year ago.  This was not always my philosophy. There were points where it was do everything yourself to save as much as possible which can be working 60 hours a week etc or more.  I also had a very unhealthy work life balance  for a long time.  Not even so much with working too much but stressing about the next deal, having enough for employees, cash reserves, too much debt.  So where I'm at today is what works for me.  Will probably be different for me next year but time will tell. 

Also we do affordable housing ( mobile home parks) and have found this to be so meaningful. Even know, if i came across a home run apartment deal, id probably pass as my passion is not there. I live and breath what I do ( even though i strive for about a 20 hour work week) the passion just really makes it not so much work. We are also typically , some type of value add, or turn around deal. So its not just numbers, its taking something that needs work and doing it. Im assuming kind of like a fix and flip but hold so maybe the BRRRRR without an emphasis on the refinance.....

Don't mean to overwhelm you but this is such a tremendous question, thought id share some of my insights. At this point , for me, the quality of my life has been far better than it has ever been by doing this part time work.  If i want to grow  i can, if i want to optimize certain work flow or processes i can, if i want to learn i can, just kind of a blank canvas.  You end up doing the things you like and are passionate about and trying to figure out how to have better and smarter folks take care of the other odds and ends. 

Ok I'm done now :) 

@Jack Baczek Heck of an answer! It's funny how sometimes you read a question and it seems simple, but you find it creeping back up on you and forcing you to think harder and deeper. I find that plans can shift quickly and it's easy to lose focus with investing if you don't truly understand what your priorities are. I've been spending 50 hours a week renovating a property for the past 4 months. We're just at that stage where you have to compensate for lack of funds with your own labor. After this property, our lives will shift. We'll have a paid for 4-plex and a minimally financed 6-plex. For the past year I thought the next logical step would be to leverage them both as much as possible to go bigger. I have recently been sensing a shift in my family's needs and priorities. I don't know if we'll let our 2 multi-families with significant cash flow just accumulate until we can buy another and maybe slow down the pace of our investing or if we'll push on with a BRRRR. Our children are all school aged, so we need to build systems to reduce our work load before we can move forwards. My answer to the posted question is to keep buying as long as your priority is to invest and other areas aren't in need of additional attention. Work-life-investment balance is pretty important.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here