Rental Property Investor · Newbury Park, CA · Member since 2017 · 37 posts · 14 votes
Investment Info:
Single-family residence buy & hold investment in Dallas.
Purchase price: $130,000 Cash invested: $130,000
A 4 bedroom 2 bath house in a decent family neighborhood in Dallas.
What made you interested in investing in this type of deal?
I want to build a portfolio of income-producing properties to ultimately replace my W-2 income.
How did you find this deal and how did you negotiate it?
Memphis Invest had this property available for purchase.
How did you finance this deal?
I used Roth IRA funds and bought it outright.
How did you add value to the deal?
Holding and renting.
What was the outcome?
I've had my current tenant for more than a year now, everything is going smoothly with this property.
Lessons learned? Challenges?
I don't think rental properties are the best use for tax-protected investments. I should have bought this property with my W-2 income and used this money to invest in Syndications or for private lending.
@Clay Gradis You could still open a HELOC and use most of the equity on this property if you want to "stretch my dollars into multiple houses". Just make sure the numbers makes sense to you.
Single-family residence buy & hold investment in Dallas.
Purchase price: $130,000
Cash invested: $130,000
A 4 bedroom 2 bath house in a decent family neighborhood in Dallas.
What made you interested in investing in this type of deal?
I want to build a portfolio of income-producing properties to ultimately replace my W-2 income.
How did you find this deal and how did you negotiate it?
Memphis Invest had this property available for purchase.
How did you finance this deal?
I used Roth IRA funds and bought it outright.
How did you add value to the deal?
Holding and renting.
What was the outcome?
I've had my current tenant for more than a year now, everything is going smoothly with this property.
Lessons learned? Challenges?
I don't think rental properties are the best use for tax-protected investments. I should have bought this property with my W-2 income and used this money to invest in Syndications or for private lending.
I was in the process of getting a loan for the 4 plex that I bought the month after this house. The process was so long and tedious that we decided to purchase the house outright. The nice thing about an all-cash purchase is I don't have to worry about the mortgage and if the house goes empty for a while I can still sleep at night. The bad thing is that I don't stretch my dollars into multiple houses which I could have done if I had taken the loan.
On the negative side, with the house in my Roth IRA, I don't get any of the tax write-offs, this money would have been better invested in a Syndication earning ~15-20% but it is done and I like the house and the $1200 a month rent has been on time for the last 14 months.
I wouldn't do it again (buy property in my Roth or 401k, well, probably not) but am not sorry that I did.
@Clay Gradis You could still open a HELOC and use most of the equity on this property if you want to "stretch my dollars into multiple houses". Just make sure the numbers makes sense to you.
I buy my houses cash in TX. I love the idea of owning it outright and cash flowing. A lot less to worry about. Sit tight and collect the check. Solid way to invest. There is a time for cash out refi and buy more and time not to.
Oops, getting my posts confused :) This house was turnkey. I did not get an appraisal on it, I bought it based on the cash flow alone. I was thinking of the 8 plex in Fort Worth when I mentioned the rehab and roof replacement and still coming in under ARV. This one I'm not sure what the appraisal would be.