16 units in 10 months
Hey BP community. I want to start by saying thank you to the BP Team, for giving me the courage and confidence to make that first deal and the consistent prodding to go and find other deals.
Because of Brandon, Josh and the rest of you all, I have went from 1 rental that I had aquired reluctantly, 5 years ago, to an additional 16 units in the past 10 months. I will be closing on my 18th property on the 21st of this month and have my 19th under contract.
You guys have encouraged me to think big, set my goals and to work backwards from there. I must say that through your posdcast, webinars and forums I have exceeded them for this year and am on track to reach my 3 year goal by the end of this year, which is 30 units.
Here is how it has played out:
Deal #1, the reluctant one. I aquired it from my church who used it as a half way house. They wanted to downsize and offered it to me at a discount since it was next doot to a business that I own. I used my I had in a 401k to make the downpayment. It pretty much broke even that is why I was reluctant, I had it appraised this year and it has appreciated 49k from my original purchase price.
#2, SFR I bought from a wholesaler (you can see the pictures and numbers from my previous post). I used a HELOC from my primary residence to fund it and deal #3. All in cost, approximately 72k, I just got my appraisal back and was surprised to see it at 125K which I used the equity to sescure deal #5. Since I bought with a HELOC I own it free and clear.
#3, I picked up on the MLS, from my real estate agent for 40k. I put about 4k into it and it now rents for $800 per month cashing flowing nicely with interest only payments ARV 75k
#4, 3 plex rental with long term tenants in place that I also picked up through the MLS. The owner was asking 95k. I was able to negotiate down to 81.5K. Without touching the property the appraisal came back at 103.5k. As the renters leave I will do some rehabs and increase the rents. It presently brings in 1725 per month and my note is $540. After PITI and 30% for capx, P&M, maintenance it is cashing flowing about $430 per month.
#5 11unit single family compound (9 small 2/1 and 1/1s, two of which are duplexes) with a 10 unit storage building and 1 extra lot for a possible RV rental. Acquired for 363k at a 12 cap. I used deal # 2 as collateral with my bank to secure the loan and 3k out of pocket to purchase this unit. This place has a lot of value add potential. I should be able to get the rents up from 6.5k per month to 7.5k by next year with a little TLC.
I thought I would post this to encourage anyone out there that is wondering, if they can do it or not, to step out of your comfort zone and go for it. We are in a very hot market with the expansion of the petro-chemical industry booming. Everything is up, but there are deals to be found, you just have to be consistent in looking.
Godspeed, Tim