Only 1.
Closed my 1st investment property (out of state) in Jan - Just got the lease signed! Ohoo!
Wow I can’t believe the traction this topic generated... I just wanted to feel out the BP community and it seems like there are a lot more experienced investors here than novice from what I’m reading.
My intention with this question was to illicit a conversation and let people talk about their investments, I figured if there were experienced investors here and I might pick up some new strategies, which I have.
I’m in a point in my life and career (Law Enforcement) that I need to make a decision on where I want to continue to invest my time. Seeing that others here seem to be living off their investments is inspiring to me because I’d like to do the same.
I’d just like to thank everyone for contributing and continued success to everyone!
Hey Jason, I work in law enforcement as well and I know how frustrating it can be at times.
There are a lot of very experienced investors here who have turned real estate into their business.
16 Units made up from a
9 Unit complex
6 unit complex
1 SFR
Only 5 here in Australia. Looking to add a few zeroes soon in the U.S. :)
@Jason C. I think you'll find that BP "activity" in the forums is usually from people with 0-3 properties or people with 20+. I don't see, oddly enough, a lot of posts from people like you with 6 units :-) That's not a good or bad thing, it's just what I notice. Heck, it might not even be true. And then you have syndicators with hundreds or thousands of units or people who put $50K into a syndication that are "a part owner of" hundreds or thousands of units. Now who actually *visits* might be a lot different than those people who post questions, reply to queries, etc. I know the two people who I've ran into in the "real world" that listen to the podcast, etc. never post on the forums.
Anyway, I'm trudging along at 36 units out-of-state meandering my way towards whatever the next deal may hold.
@Andrew Johnson I enjoyed your use of the word meandering! Thank you!
@Peter Tverdov I agree with you. I'm not a big fan of having partners. I like being the one that calls the shots even if that means my list of properties may not grow as fast as I would like. I'm told what to do 8 hours a day 5 days a week and I don't want to continue dealing with that forever. Soapbox over.
When me and my wife started doing this 3 years ago we didn't know what we were doing. The only dream we had was to see if we could make some passive (that's a joke because it's a lot of work) income so it would be easier to retire a little early. I told her if we could make $500 a month per house (15%+ ROI) it would be worth the work and the risk. We only have 3 rentals so far but all of them make $500 a month each so we're happy with that. If we can pick up 7 more over the next 8-10 years, I can retire on $5,000 a month in extra income.
I wish I could figure out how so many people seem to find the money to finance all these deals. I must be doing something wrong. We save $2,000-3,000 a month and that still seems like it takes us forever to save enough to buy the next house.
A few ways, I suspect BRRRR being the most prolific.....basically they are doing rehab to raise the value of a property and then refinancing it to get most if not all of their money out of it.....then repeat.
No, you've completely missed the point as have most people in this thread. If person A has a W2 income of 250k and person B has a W2 income of 100k from their day job and both persons love RE, but person A when they are ready to retire let's say in their 70's have 100 units but because of the way they managed their income and the decisions they made using leverage and choices on properties, location, quality, repairs needed, person A only has 2 million in networth.
Person B who has a much lower W2 income, but they have been very deligent with their income and have wisely chosen great properties and had much better success in their decision making, but only have 6 paid for properties and their networth at retirement is also 2 million. Well as you can see person A is a UAW and Person B is a PAW.
This example is very real and happens all of the time. Again I'd advise all investors on here to read the Millionaire next door, it will help you understand on how people became self made millionaires.
I think you are way too caught up in a book. There is more than one way to skin a cat. Furthermore, guys that write those books (and the Dave Ramsey's of the world) eat filet migneon and drive sports cars because they have told so many people to drive a 94 Honda Accord and eat bologna sandwiches at work to save their way to becoming a millionaire. What good is earning a nice living if you can't enjoy it when you are younger? You need to have balance my man and enjoy life, you only get one chance at it.
Dave Ramsey absolutely espouses the spending of money. In baby steps 5-6-7..... if you have the money and the net worth, he is all about spending money on charity, trips, eating out, and nice cars.
He doesn't like debt and he doesn't like people spending money when they are in debt. Yes he would go slower as a real estate investor than most of us here because he doesn't do debt. But then again, I have noticed many of those who are the longest in the tooth in this real estate investing game seem to be out of or nearly out of debt.
There isn't anything wrong with his program, his advice is incredibly solid. Now I get it, he is super conservative in how much he hates debt, and I think he is a little too militant against credit cards, but if you look at his overall plan, it works really well and is an excellent place to start.
We've sold off a few big ones, but have a couple hundred units left. We're moving on to constructing new units on various land parcels we've been acquiring over the years. Full time job and a full time headache.
@ Jay Hinrichs - how many units do you currently hold? Exclude those that you are building to sell... thanks
2 and as soon as possible I will sell those... I did own about 350 doors 4 years ago now... bought them in 2010 2011 exited when partner bought me out .. probably sold a little early.. but you know partnerships.. 54 of them bought in atl at court house steps kept them only 18 months and got an offer could not refuse from hedge fund and sold.
in short term holds we have a little over 275 doors in inventory right now. plus 35 new builds in various stages..
and about 300 lots on the books going through entitlements. And a very vigorous PEFORMING first deed of trust or mortgage business that boards between 500k and 1 million a month in new notes.. just topped 1,500 notes , although we experience a lot of payoffs as well on the note side.. but that's been a great business.. so we just traded rental income for interest income.. we find that side of the business less work and risk.. And one reason is I have been in the paper business for 30 plus years.. and of course this is advanced mature business's in no way mom and pop.. capital needs are just too much.. most of our notes go to our closely held list of investors.
Would love to learn more about this note business. Always looking to branch out into new areas of business.
28 Space Mobile Home Park Northern Illinois - No Debt No Partner
Hey there, Jack!
Where in Northern Illinois are you located? I would love to connect with you!
Also, how did you manage to find yourself in the mobile home park out of state without debt and without a partner? Do you have a local management team or boots on the ground here?
Thanks!
Have 4 units rented right now.
2 - 2 unit duplexes (I live in one of the duplexes)
1 - 1 unit single family
Currently all self managed and I work full time. Looking for my next deal... would like to find something bigger in the 5-10 unit range and start moving things to a property manager.... I am able to self manage them now pretty easily but I love to travel and it never fails that everything runs smooth for 4 months and then when I'm out of the country for a week something happens. And those headaches will only amplify as the portfolio expands.
@Patrick Roob I'm a magician , thats how! Just kidding. I was living in McHenry when I bought that one ( grew up in Mount Prospect :) Actually, the down payment of it was from a townhouse profit I sold down the street from you in Vernon Hills :) (funny how those little seeds turn into something when planted.... :) )
Everything I do is value add. That property I bought with a loan and invested some more and used cash flows to fix up deferred maintenance ( not sure i recommend that approach ... )
Everything for the most part is based on systems and processes, protocol on how to operate. When you get into the smaller parks you have to have the market a certain way and the property a certain way ( not entirely ) but less moving parts to run it as such.
Might not be perfect but it treads along pretty well. In the last 8 months i was only up there once when visiting family for Xmas so it can be done.
If you send me a PM and I will give you the address of the park .
Oh, and then we sold a deal , had money sitting in the bank and just paid off the loan. Im not sure that was wise as when you start getting equity heavy and want to make acquisitions, makes it a bit trickier but my logic was, we always had a couple properties as our "base" meaning they didn't have their debt. We paid off our SFH but when we moved to TX, we just used our "house money" as our down payment on this park, and currently renters ! But now we are trying to buy a house and have to have a work around for getting the funding for it but should be able to get it work out. The issue was that they will throw the new debt on this park we bought last month against me but wont count the income for a year.... So is the life of a real estate investor sometimes.
Also i think you have to have a specific personality type for trying to fend of partners and debt. For me is having the control and having to answer to outside voices as little as possible.... I feel like if I syndicated, i would have more customers to answer to and more lenders . Maybe that will change one day but today thats my take.
Ok way too much rambling.... off to build some sweat equity right now ( and with 78 degree weather, will probably be sweating at some point) !
I just closed on my 5th single family and went under contract for my first four-plex, which is my first out of state investment that I will not be managing myself! Exciting stuff!
1 turnkey SFR out-of-state
2 multi-family syndications OOS
1 coffee farm parcel in Panama
2 cacao farm parcels in Belize
Plan to add more SFRs this year OOS
What kinda coin does one make off of coffee & cacao parcels? Sounds interesting.
@James Wise, STACKS! 😂
It's more of a long term play. Not very much in the beginning, with much higher cash flow in future years. 20-year time frame proforma IRR is around 12%.
I like it because it’s turnkey, non-correlated, and different from other investments I own. There’s also a social sustainability component which makes me feel good.
Speaking of turnkey, keep up the good work with your daily videos. I’m on your email list. Some of them are hilarious. Love your approach and enthusiasm. I need to learn more about your market, but definitely interested in a class B turnkey with good numbers that’s not in the hood. Hopefully we can do some business this year.
We have 4 SFRs currently rented, one undergoing refurbishment, and two on the rental market but not filled yet. So, in summary we have 7 SFRs. (plus one shack we didn't count) My wife and I do everything ourselves from refurb to management so our growth progress has been slow but steady. We are now doing this as our only source of income and time will tell whether we have to jump back into the W-2 world. (we hope not)
To help our income, we are also converting space in our house into Airbnb rentals but that has had mixed results. Hopefully that will develop into some steady income. We've averaged about $250 per month on that but have only been in operation 4 months.
We are debt averse and only have a HELOC we use for acquiring/funding properties. Due to our unexpected transition into full time real estate investment we have spent down all our reserve funds and the HELOC has taken the place of that. It's not a situation we want to be in but it is what it is.
@James Wise, STACKS! 😂
It's more of a long term play. Not very much in the beginning, with much higher cash flow in future years. 20-year time frame proforma IRR is around 12%.
I like it because it’s turnkey, non-correlated, and different from other investments I own. There’s also a social sustainability component which makes me feel good.
Speaking of turnkey, keep up the good work with your daily videos. I’m on your email list. Some of them are hilarious. Love your approach and enthusiasm. I need to learn more about your market, but definitely interested in a class B turnkey with good numbers that’s not in the hood. Hopefully we can do some business this year.
Thanks, I appreciate the feedback. Real Estate can be boring to some so I try to add some flavor whenever possible. Good luck on the coffee. That is pretty cool stuff.
@Patrick Roob I'm a magician , thats how! Just kidding. I was living in McHenry when I bought that one ( grew up in Mount Prospect :) Actually, the down payment of it was from a townhouse profit I sold down the street from you in Vernon Hills :) (funny how those little seeds turn into something when planted.... :) )
How funny! I used to live off Deerpath in Vernon Hills! What a small world!
I definitely will reach out directly, because I am beyond interested in finding out more about your way of remote management with "systems, processes and and protocols" as mentioned.
As for your quote "The issue was that they will throw the new debt on this park we bought last month against me but wont count the income for a year.... So is the life of a real estate investor sometimes." I certainly understand this statement! How do you get around this issue?
Thanks!
Patrick
@Patrick Roob Several ways, refi a property, put new debt on a paid off property, keep renting, go out find a SFH that you can buy on owner finance terms, get money from a private source.... Probably other ways. Im sure if i pushed hard enough and turn enough stones i can find someone that will be ok with it. Persistence and grit are something that really pay off in RE guess really anywhere :)
This is the type of question we advise our members not to answer in a public forum. They should actually own nothing in their own name.
In Illinois we try and use Land Trusts to protect our privacy and avoid becoming a target for a plaintiff's lawyer. We also buy plenty of liability insurance, just in case.
6 doors. 3 in Phoenix (where I live.) 2 in Memphis. 1 in Davenport.
Presently I have 19 doors, I think. Sold 2 SFH in the past 2 weeks and will sell 2 more SFH in the next month and buy 2 more duplexes that are under contract, one with major fire damage.
My neighborhood has turned super hot and investors are buying everything and rehab is going on all around. So, there's a better type of home-owner coming into the neighborhood, but the D tenant pool is still the same - don't want to deal with them any longer.
Started a creative community on one block and am only renting to creatives (artists, musicians, photographers etc). Am buying out my partner, who has 2 duplexes, so that I have 6 duplexes in the same fenced block. Completely different tenant pool than the rest of the neighborhood. And tenants don't want to move, because they really have become a community. They're hanging out together and are doing projects together.
I have another assemblage half a block from there and am setting up my 2nd creative community. Both of these communities are so close together, that there'll be regular interaction and we'll have monthly potlucks and movie nights.
Across the major street is a 31acre lot that is going to break ground on 3-10 . The first building will be 100 maker studios/start up spaces. Behind that is the Beltline, which is the biggest infrastructure project in the U.S. and our stretch will be worked on pretty soon.
So, while I don't have a lot of doors, I knew from the beginning of these developments that would eventually come. So, my present value on those properties is about 2million and my mortgages are about 1/4 of that. But properties go up about 10K/month right now. Every flipper is pushing the listing price another 10K for 3/2 and they sell, because there's no inventory.
While I could hold on to those 2 SFH and see the value jump further, it would require me to put in those D tenants, who would tear up the houses. Selling now will allow me to renovate that burn-out duplex and maybe buy some other properties adjacent to my 2nd assemblage, which are presently being renovated. And I could buy with a mortgage and put in creative tenants.
In the meantime, once ground has broken on the lot next week, the rest of Atlanta will become aware of the changes in this neighborhood and the value will just keep going up.
In addition to the doors, I also have a triple lot, which is part of my 2nd assemblage. And a couple of lots in another Atlanta neighborhood, that is planning some major development. Waiting for them to want to buy me out.
Overall, I expect one or 2 developers will want to buy my 2 assemblages within 5 or so years.