All Forum Posts by: Cameron Lam
Cameron Lam has started 4 posts and replied 106 times.
Post: Is a "Real Estate" CPA Necessary
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Gabriel Rascon:
@Mike M.
Hi Mike
I’m a in Gilbert Az. and researching. I just recently found a tax advisor/cpa company that is very competent in real estate. It involves every other week mtgs, strategizing, planning etc. and they charge close to $10k upfront for initial 6 months and continuing fees(which is understandable). Is this normal structure for tax advising and cpa services?
Are they tax advisor AND legal combined? Cause I would think you would need both.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Sean David Gibson:
Great Story! Congrats on your success! What do you use to find your deals? You mentioned Facebook marketplace, where else?
Mostly through MLS and zillow. I've actually only ever closed one off market deal and haven't done any auctions.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Yu Liu:
@Cameron Lam this was a very inspiring post. Thank you for sharing your journey. Glad to see your successes and the possibilities that it affords those of use that are just starting out (like me). I apologize in advance if you answered this in your comments already, how did you go about finding your contractors, BP? word of mouth? trial and error? and what issues did you have house hacking or any advice you wish you knew when you started house hacking? Thanks again!
Hey Yu. I found my contractors through the local city facebook page. We have a buy sell and trade page and at separate times I asked for plumbers, roofers, landscapers, etc. I think with house hacking when I first started I was very lenient and just had friends stay with me. I didn't have any formal lease agreement which probably wasn't a great idea. If you do it I would have a lease and be upfront about the house rules...ie...cleanliness, dishes, quiet times etc.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Ed Brancheau:
What a great inspirational story and it got me thinking about so many opportunities.
One thing that you mentioned was renting out to college students and I'm just wondering if you've discovered a max radius for their school that they'll rent a room?
You definitely got a post here that I'm going to follow and come back reread a few times. Thanks!
Hey Ed. I'll generally find that college students won't want to be more than 10 miles or 15-20 minutes away. That's probably the limit in my opinion. Young professionals you could extend that up to 30 minutes.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Kevin Reinell:
Are you finding your deals all on the MLS?
Yes all on MLS and one off market.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Josh Hutson:
Awesome post, I laughed at the i8 cause i literally just justified an S550 purchase at 1200/month cause im collecting rent from a roomate hahahaha
Hah! Best worst decision I have ever made :)
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Suresh K.:
I personally don't touch deals unless they are 15% CoC. Although my average is around 22% due to the way that I rent out by room. Traditional rentals you have to look harder and can find 18+ generally with duplex-fourplex
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Brian G.:
@Cameron Lam nice! So how many tenants do you have altogether in the 8 properties?
32 or 34 I can't remember off the top of my head.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Mike Dice:
Way to go man ! Here are things I love:
1. The shout out to the parents, huge advantage that you didn’t squander. With your savings rate early on I’m assuming you didn’t have student loan debt? But dude either way just saving that much at 22 while most of your friends are in Vegas or Rome ? That’s huge. I did not do that.
2. Maxing our your properties with the room by room rental method. I love this, and I love steady renting college students with parents that pay their bills.
3. Your debt tolerance. I’m jealous of this, wish I had it. putting 7% down 93% leverage letting the bank take all the risk is sweet. With these low interest rates this type of thinking is awesome. As long as you have that return cushion and steady rentals (college students rent in recessions), you should be able to withstand a market drop.
4. Pheonix. That’s a lucky place to be in the last 10 years market wise. Cheap property, nice appreciation.
Here are my concerns:
1. Leverage. Carrying a lot of debt, if you run into a cash intensive situation and the market turns south...
2. Running 20 properties will be job. Especially if many have multi room leases. You can get prop managers but of course you have to pay them. you also become increasingly exposed to liability.
Thanks for the kind words Mike! Yes I am highly levered. Over $1M in debt. But also around 0.4M more in assets with most of the growth happening in the last year. The cash intensive situations do concern me. Which is why I am building buffer in each of the properties for the repairs and capex. Not sure how I'll bucketize all my reserve money...but I've been stashing away money in each account for the inevitable rainy day. Now once I reach a certain threshold lets say $10K-$15K not sure if I'll reserve more per property. Like I said may be advantageous to bucketize it into a central fund.
So far it takes me about 0-5 hours a week for the 8 soon to be 9 properties. This 9th property will be an airbnb half the year so I'll have to develop more systems. But yes once I hit double digits...I'll consider quitting my day job.
Post: How I achieved $5k+ monthly cash flow in 1.5 years
- Gilbert, AZ
- Posts 106
- Votes 604
Originally posted by @Tim Kaminski:
@Cameron Lam Thanks for the quick response.
Do you accept month to month tenants or just year long leases?
Do you only accept 1 person per bedroom or 2? Just thinking it could get pretty crowded.
What are the downsides of the rent by room strategy in your opinion?
It varies. I used to do month to month but had some higher turnover. Once I started doing 6 month to 1 year leases I was able to put the 2 month early termination clause in there which has actually increased my cashflows. I've done 2 people in one room(friends) one time and it worked out well. My rule is 3 people max per bathroom.
Downsides are you will have higher tenant turnover, more time sending out rent requests and utility requests. Sometimes there is roommate drama.
But upsides are the extra cash flow. I have a friend with a 5 bedroom home and he could traditionally rent it for $2200-2400 and has 5 young professionals paying $700 each for $3500. The extra $1100-$1300 a month or extra $13-15K a year is well worth it. Even if you divided that extra $13-15K by half to account for extra expenses and repairs you're still coming out way ahead.