All Forum Posts by: Austin Fruechting

Thank you @Austin Fruechting for your reply.  I totally agree with your mission/goal, that is my ultimate goal as well.  I just want to be able to achieve that in a way that I feel really good about.  For now, I work at a university and love the mission of impacting and changing students lives for the better everyday. I am trying to find same that feel good mission as a landlord.

Jen,

I'll take that as a compliment. I'm doing alright, but there's a whale in my market that has done even better. @Johnson H. accidentally ran across some of his deals. My goal is to become him. It's a niche, and you have to be able to break in.

Johnson understands my biz model well as I share with him and a few close friends on a group chat on almost a daily basis. Johnson can share with you my biz model on a paper napkin when you attend his next meet-up. It's really simple. Johnson is trying to replicate it in my market. I welcome him with open arms instead of fearing competition.

My lowest yield building is doing about 5% CCR while the best building is doing about 17% CCR after partially stabilized. I showed Johnson why I don't care much about the CCR because I can get 15 years of CCR upfront. It's more about control and leverage while having your tenants buying you the building. Time is on my side to keep pushing rents up on the units that are still below market rents.

Our tenants are paying down about $120k/year of principal while the buildings are estimated to generate $120k/year in cash flow with 40%-43% in estimated expenses per building.

We have forced about $3M worth of appreciation for a $10M portfolio. If history is any guidelines, 3-5% average annual appreciation is $300-$500k/year in gained equity. That beats the principal pay down as well as the cash flow combined. So is the cash flow the icing or the appreciation for our market?

On average, my partner and I work about 2-3 hours/day, 2-4 days/week. This is our full-time job. We have a property manager company managing our buildings and some handymen/contractors to take care of the repairs, maintenance and rehabs. It's not headache free I can tell you that, but so is a W2 job.