All Forum Posts by: Caleb Johnson

Thanks for reaching out to the community Melanie. There are 2 lessons that come to mind.

1. When I bought my 4-plex last year I needed to renovate one of the units. I thought I should do it myself so I can see what it takes to do something like that. I quickly learned that I was not a handy guy. It probably took me 3 months do rehab the 2/1. About 6 months later I had the opportunity to do the same to the unit next door. I hired someone to do that one and they finished in 2 weeks. I saved the heartache and the money in lost rent. And it was done better. I learned that I will fire out labor to someone else.

2. I recently got my first flip and I consider myself a good networker. I had my coach, his wife, down payment partner, the lender, GC and the wholesaler all there for the final walk through to see what we had got before it closed. Long story short it was just too many people. I quickly learned that you can have too many advisors on certain things. I need to have one person that is giving the advice and sticking to that. Otherwise someone might have a different opinion and you will feel like you are going in circles because someone is telling to turn right but someone else will tell you left. 

Hope you find some good stories in this forum. Thank you in advance. -Caleb

Hey Nina, that's a good question. I put it all aside for a rainy day. Once you get enough properties to where you can have a large amount of cash flow coming in that can handle a few big repairs all at the same time, then you don't need to just sit on things. You will know that all the money that you need will be there each month.

Another thing to think about is if you do have that money in another investment, how liquid is that? If you have an AC go out and you can't pay for a new one for another 7 days, that won't work. 

Right now I just passed the one year mark for owning my 4-plex and I am still replenishing my cash reserves. But I am looking forward to the day when I can have so many units that the cashflow coming in will surpass any repair that comes up.

Thanks for giving us the opportunity to be in the magazine Kaylee. If there was something that I wish I knew when I bought my first property, it would have to be to know that I would be putting money into this thing for a couple of years until I would see results. My first property was a house hack. I bought a 4-plex and moved into it, my plan was to renovate it and get the bad tenants out. I had this idea that it would be give me great opportunities monetarily. 15 months later I am still doing some light renovations but will be just about done by the beginning of the year. I wish I would've realized that I would be "suffering" before I could see any results. 

Thank you in advance and I hope you get some good material from the forum. -Caleb

Congrats Dave! I am happy there is one more person that doesn't have to be in the rat race. It just solidifies the fact that there is light at the end of the tunnel for all of us. 

What are your plans now?

Hey Tim, thanks for starting this post. What helps me when I am overwhelmed is to close my eyes and think about why I am doing what I am doing. When it is 2am and I am painting while the tenant next door is selling drugs, I remember that I want to retire my mom so she doesn't have to work on her fresh bi-lateral knee replacements. What also helps is to ask for Gods help and to remember that he doesn't give us anything that we can't handle. Lastly, I'll remember that this is the only life that I get so I better make it count. There is no room to quit.

Hope this gave some insight and could help someone. -Caleb

Hey Chinyere, I think mentors are an amazing way to speed up your investment career. I would try to find a mentor that you don't have to physically pay for first. I might be biased because all of my mentors have been like this. I've either ran into them at work or at the gym and have then asked to buy them lunch. The whole point of me asking them to lunch is to first get their number and second start to build a positive relationship where I add value to their life, even if it is just a free meal. At lunch I ask them questions and get to know them and their business. This is also a good place to see if they are someone that I even want to associate myself with. There are a lot of people in the industry who I wouldn't want to be in my life and I'm sure you can say the same.

It is important that when you do get a mentor, that you take the advice that they give you and actually take action on what they are telling you. Of course if something doesn't make sense for you and your plan at that time, then I wouldn't. But if you communicate with them on what you want, usually they can give some important guidance on what path to take. This is important because there is nothing more frustrating than giving advice to someone who says they want to be successful and then they don't even listen to you. 

Lastly, I think a mentor should be someone who is where you want to be. Like you said, that individual in your market is focused on MF and buy and hold as are you. But you need to make sure this person isn't 100 steps ahead of you. If you are just starting out, you should not be looking at someone who has 2000 units. They are so far ahead of you that they won't be able to give advice that you can even use. You need someone who is relatively small but is still about 5 years away from where you are now. My first mentor had 12 doors. Then a year later I met my next mentor who had 16 doors and had done 30 flips. My second is more focused on investing compared to my first just because the first is more dialed in on being an agent. There is nothing wrong with this of course. You just need to know what you want and to find someone who wants it too. 

Hope this helped, let me know if there is anything I can do for you. -Caleb

Thanks for posting this Erik, I think this will give a great opportunity for lots of people to tell their story and get inspired.

I wanted to invest in real estate because I wanted to retire my mom. At the time she got Bi-lateral knee replacements and was forced to go to work because she couldn’t afford to stay home. That made me mad to say the least. Here is the woman that sacrificed when my parents got divorced, got a good paying job to support me when I was in middle school and wasn’t all that easy to handle to say the least. 

So after a year of researching, I house hacked my first 4-plex. Since then I have renovated the units. I have kicked out drug addicts, hoarders, drug dealers and have fought mice with my bear hands. I have put blood sweat and tears into it because my goal was to cash flow $2,500 a month to give to my mom and retire her. 

So, it has been 1 year since I bought that property. Since then I have partnered on a flip and have a handful of more partners to do more with. I’m still working on retiring her, I found out that real estate isn’t a get rich quick thing lol. But it does repay what you put in and much more after that. 

Good luck to all you investors out there. Feel free to message me if you need contacts in the AZ market. I know a lot of professionals in the area. Also I am open to talk about partnering. Have a good day!

Hey Kim, congrats on finding the deal. It sounds like you have put a lot of thought into this. I do have a couple of questions.

1. You said that the repairs have to be done within the first 6 months. Now if you have a 190k rehab cost and you are gutting 4 units, then I would expect it to take a bit longer than 6 months. That is concerning to me and I don't know if you have a plan if it takes longer. I haven't used a 203k loan before so I don't know how that works either.

2. What would it appraise for after the rehab? 

3. If you are house hacking this then you will be living in one of the units. Do you know what your plan is for that if you are renovating all the units? Will you be living in one unit and then moving into another unit that is renovated so you can rehab the second one? 

Otherwise it looks like you have all the numbers. You might be experiencing some anxiousness because all your hard work in getting a deal is coming together and you don't want to make a mistake. The first deal isn't usually going to make you rich or poor. It is more about traction and just getting the first one under your belt. Good luck!
 

Thanks for the tip Nathan. I’ll check out meet.com and see what happens. Have a good one and happy holidays.

Hey BP members, hope you had a great holiday. I’m a fairly new investor with 1 house hack and 1 current flip. I was able to do my flip through BP and I have invested no money into the deal. I like to message people on BP to try and network and help in anyway I can. 

I’m looking to do more flips involving  partners so I can scale more quickly into more passive income and move closer towards my goal of helping my mother retire early. Does anyone know of a good way of networking and meeting more people interested in partnering? I’d love any help you can give. Also if you’d like to partner I’d love to talk with you more about that.

If there is anything I can do for you let me know. I know quite a few professionals in each area of RE in the Arizona market. I also have a good beat on how the market is doing out here so if you are an out of state investor and you’re thinking of investing here let me know and I can answer any questions you may have. 

Thank you and have a good day.