All Forum Posts by: Austin Fruechting

When I first started digging into the idea of real estate investing I ran a spreadsheet about 50 columns wide and 135 lines long running out every scenario I could think of as far what to do with our money.  The clear winner was investing in real estate.  That was all she needed because I wasn't just saying "Hey this is what I think we should do."  I had the proofs to back it up as compared to other investment strategies. 

Makes me glad my income comes from providing housing that people will always need! 

Oh! I have a good one, we did a sailboat day with this old French couple in the Riviera. It was an amazing day and they were awesome people. They cook (amazingly) and provide the wine. They do extended trips where you fully learn sailing along with tons of stops all the way down the coast through Spain, Portugal, and all through Italy.

Another vote for option C.  For just a little more option A you could have 2 of those cash flowing $760 a month and have equity building in two properties through a tenant paying the mortgage and appreciation. 

Read the book man and see how decades of rent control played an enormous role in everything you are talking about.  Or don't, makes no difference to me.

Originally posted by @Les Jean-Pierre:

I didn't grow up there but went there a lot. There every two weeks. I guess in terms of "progress", is it better to see something other than bodegas, dollar stores, etc? It helps. But, I put this squarely on the city of ny for not building more affordable housing.

 The government shouldn't be building housing.  This issue is on them, but because they passed rent control laws. Because of rent control laws it no longer became economically viable for developers to build more affordable housing.  It was only profitable to build luxury units that were exempt from the rent control laws.  Some buildings became abandoned because the owners could no longer make any money as taxes, insurance, and repairs/maintenance costs all went up but by law they couldn't raise prices. And so many other reasons. Seriously check out the book "Basic Economics".  It's not just New York City, it happened pretty everywhere rent control laws were put in place.  

Nothing that demands the work, efforts, or goods of another is a human right.  

In New York, this is actually largely attributable to Rent Control Laws.  Read about it in Thomas Sowell's book "Basic Economics".  The law set up intended to help the lower class has actually hurt them the most. It's fascinating.

Originally posted by @Account Closed:

@Austin Fruechting

First of all, thank you so very much for providing the guidance, insights, and resources for us to learn from and execute on. 

Congratulations on achieving one of the dreams of a lifetime! One of my good friends recently retired from her job of 11 years after both she and her husband had been building their portfolio for at least that long. It took a Tony Robbins event to get her to finally let go of security and enjoy the freedom, but still!

Anyhow, I have read this entire thread up to this point and was wondering if you'd mind elaborating on how you built and maintained your systems and people you brought in to handle different aspects of your business. You mentioned you work or worked only 1 hour per week in part thanks to a team of agents, the 2 property managers, the accountant and attorney. You also said that if you have a good property manager and good systems on your side, then it's pretty easy to do what you did. 

Did you have written procedures for some of the tasks and responsibilities in your business? Did you ever use virtual assistants or freelancers for the roles outside of the accountant, agents, attorney, or property managers? Did you ever have a problem at some point where you wore too many hats? 

Thank you again.

 Thanks Kristopher!  My wife is actually choosing to work for a while longer and see some things through.  She's one of five on the exec team at a company in LA and they have big things in the works. But she loves knowing she is only doing it because she wants to, not because she has to. 

Yes, with the right people in place, it is easy.  I legit do only spend 1 hour per week as far as keeping up with the 107 units. Ok, now to answer some questions:

WRITTEN PROCEDURES:

Kind of.  As I built the property management company, yes I had a few written procedures. The written procedures and responsibilities were initially done for owners that were interested in having me manage for them. I only ever had one full time employee in that business. When I hired the full time guy I didn't add any additional "job title" type stuff.  I pretty much just said here's what we do, how we do, and how often we do.  Then had him shadow me and slowly start taking over the day to day. 

VIRTUAL ASSISTANTS - no

TOO MANY HATS:

No, but I had a flexible day job (retail shop that had a day to day manager).  Pretty much just had to get the stuff done by the time it needed to be done. I have definitely put in 70-80 hour work weeks.  But even before hiring someone in the property management business, most of my weeks were an easy 40 hour week or less.  And that included the property management business, running renovations, running my retail shop, and acquiring my own properties. 

Originally posted by @Brian Garrett:

@Austin Fruechting Love the strategy it makes perfect sense. Go get em!

 Thanks!  I was looking for a house to flip then this opportunity fell into my lap and was going to be a cakewalk. It's in the area where I have all my rentals, so all my normal crews can do the work (good prices and no babysitting!). 

Should be an easy sale at 1.25% rent/purchase. We should get $700-725 per unit so we'll offer up $1400-1450 in rent with all the big CapEx taken care of for around $110-115k.