Fastest route to $10,000/Month Passive Income

108 Replies

@Matt Jennissen

I will give you my roadmap...YMMV. I got HELOC lines on my primary and vacation homes. I then looked for distressed properties near where I live...like a 8 block radius. I would cash offer, no inspection, no survey. Just updated abstract and title insurance. Fix it up, rent it out. Month to month. Aim for middle class, essential workers. Pay down the loan, buy another. Found houses on auctions, MLS, and word of mouth. Got a great insurance agent and tax preparer. Some years bought none, others bought 4. I am now at 19 houses, 19doors. 4 are not rented.

I still work a W2 job, but only because I love it and it provides my insurance. I own everything outright. No mortgages.

@Matt Jennissen

Pretty awesome!

Im currently $3,6500/month cashflow 5 sfh. Thats all after mortg/notes. I dont include maintenance because i dont need the cash flow.

Goal is 15k in the next 8 yrs.

Maybe i should split the goal 4 yrs each

Originally posted by @Caleb Christopher :

@James Hamling

"Never lose money"... I can't get with that. Maybe "don't" but not "never." If your goal is to never lose money you won't take the right risks.

Wasn't it Kiyosaki who said he's never met a wealthy person who hasn't lost money, but he's met plenty of poor people who have never lost a dime?

 "Never lose money" is actually a Kiyosaki rule, ironically as you intoned him here. 

It is a fallacy of the novice that investing, and the inherent risks, will require one to take risks of loosing money. What is actually true and accurate, and many say to this, is when correctly investing or underwriting it is a boring, uneventful thing. Why, because it is all math. Multiple eventualities have been accounted for, contingency funds and plans set in place, numerous exit strategies planned, all backed with rigorous research and data analysis. THIS is what comes from adhering to rule #2 NEVER LOSE MONEY. 

Is financial loss a potential, absolutely BUT not as a natural factor of investing, instead as an unforeseen X factor event or a failure of analysis, change in data, misreading, etc etc. 

Real Estate Investing is not a game of hunches and guess play, every "Pro" has a highly refined mathematical approach to analyse to project a potential investment. The deals I didn't take due to following "Never Lose Money" that did turn a profit are far-far outweighed by those that did go lame and would have resulted in a loss of capital.

It is Casino Rules; play a risk happy game is sitting at the black jack table trying to end with more than began. "Never Lose Money" is being the dealer..... You tell me who "wins" in the end. 

@Matt Jennissen congrats man on being this far along! A lot of people do not have the courage to jump in like you have! #1 keep the hustle and be consistent and intentional with everything you do in real estate. I wrote a quad strategy on another thread that quite a few seemed to like, so I’ll sum it up, but reach out if you want details. I built my portfolio starting like this. Keep in mind, I have no idea how much capital you have to work with, but we can be creative with that!! Find the deal, then find the funds!

Simple strategy if you had 100k to invest that takes Hustle and finding off market deals usually. I did and still do drive for dollars! Every single day........several areas in Midwest you can get into quads in C class neighborhoods 80-90 k and sometimes cheaper. You can get these to appraise at 120k easy as long as rents are where they need to be. As long as you get all in at 90k or below you can refi after 6 months at 75-80% which means you pull 90k out. That 90k pays off your loan of roughly 72k and down payment of 18k. These are rounded numbers, but every dollar below 90k is now money you put in your account on the cash out refi. Now you have 0 money in the deal on a fully amortized property cash flowing around 1k-1400 per month. If you had 100k you could easily do 4 of these with that cash. Once all are refinanced, you have your original 100k and you rinse and repeat! 8-9 of these quads easily cash flows 10k or close to it. You could also partner with capital partners to fund your gap money on down payments and have 0 cash of yours in, which is what we do.

We use this brrr strategy with forced appreciation on larger units now, but I started and built my initial portfolio on quads and tris.

Now if you don’t have capital, hustle to find the mom and pop owners and work owner finance deals!

Lots of ways to skin a cat and this is just 1

Good luck man

Don't reinvent the wheel.  Pick a strategy and become the expert at it.  It will get easier and easier.  Oh yeah, and write that goal down every day, and it will happen.

Good luck!

@Bill Goodland thank you sir. Building systems is the biggest hurdle for me as I'm a pretty unorganized, fly-by-the-seat-of-my pants person by nature. But I've recently read the E-Myth and am currently reading the Checklist Manifesto, and both of those books have given me some good frameworks to work with and I'm implementing those ideas into my existing portfolio and will translate that to scaling, like you said. BRRRR definitely seems the best way to scale to me.

Thanks for your input! 

Originally posted by @Cassidy Burns :

Don't reinvent the wheel.  Pick a strategy and become the expert at it.  It will get easier and easier.  Oh yeah, and write that goal down every day, and it will happen.

Good luck!

Such simple advice but so stinkin' true. Thanks a lot for the reminder and tips @Cassidy Burns! Re-writing that goal definitely has helped me in the past. 

 

@Namit Salwan go for the multi units. BRRRR it. Buy one that is undervalued. Put some rehab work into it to raise its value. Rent it out. Appraise and Refinance it to get 70% ARV back, and still get your monthly cash flow. Then repeat!

Originally posted by @Namit Salwan :

If I have $650,000 cash to invest. Should I buy one big multi family property for about $2 million or buy 2-3 multi family properties?

This is something that comes down to value and potential growth.  No easy answer for something like this.  In addition, you could get a large profolio of properties as another option. 

@Todd Pultz nice strategy, I wish it was that easy for me on the east coast NYC area. Maybe I should be looking more in Ohio?  I flew to columbus and Cincinnati few years ago at some large assets 30-90 doors. 

@Leo F. I have plenty of friends your way and they say the same thing. Cincinnati and Columbus do not work like that with ease either. Dayton is overlooked a lot because we don’t fit the model for growth etc. but several Midwest cities like Dayton can get this done. It’s not simple. We drive for dollars and find off market properties, but it is very doable! You don’t get the high appreciation but you also don’t get the drastic down turns. Dayton and others are stable cash flowing markets with average appreciation.

@Todd Pultz yes I agree with those parts of Ohio are somewhat similarly difficult from what I experienced. I definitely  don't "need" the appreciation as I have plenty of it in my NY portfolio. I am interested in more cash flow and stability. I don't know much about Dayton but I will look into it. If you know of any multi family props that you would be interested in wholesaling please let me know. 

@Tony Kim what if you don't have as much of your own capital to rehab the units after buying the property and if you hold the property are unable to get that capital back? It would be hard to do a BRRRR on a property if you are having to wait until a tenant leaves in order to rehab the vacant unit. (but I'm thinking how I could rehab the units, but not leave my capital so drained)

Originally posted by @Jean Joseph :

@Matt Jennissen

Pretty awesome!

Im currently $3,6500/month cashflow 5 sfh. Thats all after mortg/notes. I dont include maintenance because i dont need the cash flow.

Goal is 15k in the next 8 yrs.

Maybe i should split the goal 4 yrs each


Nice work Jean! So if you do include maintenance and other expenses, what would it cashflow? I would guess you'll want to use the cash flow at some point, right? That is a great goal! Are you buying in the NYC area or where do you invest? 

@Matt Jennissen

Thank you Matt!! If i do include maintenance I'd be looking around $2,400/month. two of the properties are cleared--no mortgs.

So far I've been using the cashflow along with my personal income to finance deals.

Im all new--1 year and half into this.

I only invest out of state. Im in west palm beach fl and Detroit Mi.

Originally posted by @James Hamling :


 "Never lose money" is actually a Kiyosaki rule, ironically as you intoned him here.

I'm aware of that line with/from Warren Buffet, but I know I heard/read Kiyosaki say what I said above (never met a wealthy person who didn't lose money).

I can't find the "never lose money" thing from Kiyosaki anywhere.
Is that something you can find for us? I'd like to see the context.

@Matt Jennissen probably not the most efficient or most successful but definitely the fastest, go buy some lottery tickets. Cash advance all your credit cards and cash out your entire life savings. You’re welcome for your millions. I’ll only take 20% for the great idea.

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