Thank you all for the responses! Maybe I'll add a little more about me so perhaps some of my questions make more sense. Yes, I have a job that produces income (moderate/average income) and a comfortable emergency reserve. Married, no kids at the moment, and husband is also working after recently finishing an apprenticeship. We bought our first house in May 2014, which was our first accidental-live-in flip. 2 months after buying, oil prices started to free fall, and house prices in Calgary followed suit. We did fairly well on that first house, and bought a house with basement suite for #2. We renovated it, and rented the basement, and sold in the black as well, though we got more out of the rental than we did of the flip portion. House #3 seemed like a pretty easy little flip that didn't need too much work, but the economy continued to tank, and we barely got a profit out of that. Nevertheless, we preserved our equity from each property, added a little in profit, and some from rent from house #2. (Had we kept that first townhouse, which we bought before really knowing what anything at all about real estate, other than it was ugly and we could fix it up, we would probably be close to -$70,000 upside down on that house, the market dropped that much in the last 4 years.) Our first goal was to be able to get an acreage within commuting distance to Calgary, and in Aug 2017, we had the opportunity, and bought land, moved a bungalow onto a new foundation, and we are in the process of building everything else on the property. In Sept, the plan is to do a refinance on it, and get a little cash out. I'm in Canada, with no intention of ever living in the US, but I would like to invest in property in the US. Selling the primary residence is not an option since this was our goal for the last 4 years, and my husband is pretty well done with any form of house hacking now that we have our "home" and not a "house".
My definition of scaling up would be acquiring second, third, fourth, etc properties, in a relatively short time frame in order to build more capital and/or cashflow. For me, I'm focused more on cashflow, and actually owning and being in control of the property (so not a partnership where I'm in a big deal with 6 other people. I feel that's more of a business venture than scaling up.) I'm well aware it's not a race to get the most properties possible, but I want to reach financial independence within the next 5 years, which means I'm going to need a plan on how I'm going to get that done, and how to make the jump from 1 to 2, 2 to 3, etc. I know many say, "just get the first one and go from there!", which isn't bad advice, but before I jump into the first one, I'd like to have half a plan of how I'm going to get the next properties. For example if I have limited capital and it makes more sense to BRRR the first few properties, that's good to plan for so I don't jump in for property #1 and spend most of my capital on a turnkey.
BRRR makes sense on recycling your seed money, and I'm thinking this is the way I would like to go - however, the realist part of me questions how realistically successful this strategy would be if I'm not only out of state, but also investing out of country. Property management on a rental for OOS? No biggie. But doing a reno and refi while not in the country? Be honest, how much of a challenge will this be? I don't have friends or family in the US that could "pop by" and check things out now and then - that would have to be someone I would hire or a potential partner.
Which brings me to another point - partners. I certainly see the value if you have a fantastic partnership and things go really well. But there are also the down sides - things fall apart, someone's not happy with the division of labour and profits, and you can't very well chop a 50 unit apartment building in half and freely do what you'd like with your half. For that reason, I'm wary of partnerships because of all the potential complications, and at the end of the day I want to own my properties, that I have full autonomy over.
@Account Closed could you tell me more about Subject To and Wraps? From my limited understanding, I thought that was a strategy that was a great approach until a lot of banks put the kibosh on it, and it's now very tricky to use?
Private money - yes that's certainly an approach as well.
1031 exchanges - love the idea, not possible to do that in Canada, but is it possible for a Canadian to use a 1031 exchange in the US? I'm going to have to look into that further, because I don't know the answer.
Appreciation - also very understandable how this helps one to scale more quickly. Quite a bit more to do with luck and local economy that other factors.
Hard money - if I'm focusing on rentals, are the hard money rates worth it? Would most people use this only to fund a BRRR?
Seller financing - Definitely a plus when you can make it work! For someone who is out of state/country, how likely is this to be an employable strategy?
Good point from the few people that pointed out that a lot of the podcast guests started in 2008-2012. A lot of them did. Awesome for them, but yeah it was a totally different market back then compared to now.
Being not local is limiting in a lot of ways, but I would say one thing I have going for me is that because of stellar credit, banks have been willing to loan me a significant amount on unsecured lines of credit. Once our primary is refinanced, I plan to put this money to the best use possible. I just want to make sure I'm aware of all the ways people have expanded their real estate holdings so I'm not missing the obvious!!
