All Forum Posts by: Michael Swan

Hi again @Dennis Nikolaev,

You have a few options.  Refi and get about $500,000-$600,000 dead equity out and buy a 2 million Multifamily and have some reserves to reposition the Apartment complex.  Another, 1031 exchange for an apartment complex.

Feel free to reach out to me or message me.  I usually leave my phones available for BP members 3:15-6:15 during the week.  Plus, you live local too.

Swanny

Hi @Dennis Nikolaev and @Alex Sabio,  Since Alex mentioned me, you may want to reach out Dennis.  On Podcast 238 I explained my story of having the same issue.  I did the same thing as you did, buying rental properties here in San Diego, 10 of them in 2011-2012 and when they doubled in value here in San Diego (Santee and Lakeside). So, I did  a return on equity calculation and I was barely getting 3% on my equity.  

That was unacceptable!! So, I 1031 exchanged those rental properties in 2015, 2016, 2017, and 2018 that were cash flowing at about $50,000 a year for Apartment complexes in NE Ohio, made a few mistakes along the way, but now am a principal investor in over 200 units.  My cash flow currently sits at about $180,000 a year and is growing as I type this here.

To think, in 2011, the most I ever made W2 combined family income from my teaching jobs and my wife’s job before taxes was $80,000.  Then California takes about 13% in state taxes etc....

Crazy!!! I am financially free now and helping others to do the same by bringing them into my deals now.  I just put an offer in at $35,000 a door on a 64 unit too. We will most likely settle between $35,000 and $38,000 a door!!

Onward and upward!!!

Swanny

@Shane Craig

Interesting points!! However, after 4 yrs Multifamily and 200 units, I have $180,000 in cash flow per year and rising. I told my story on Podcast 238.

Swanny

Swanny

@Travis Watts

In 2011-2012, I sold approximately $200,000 in Self-Directed IRA and invested in 10 rental properties one at a time with 25% down payments. I paid the stupid penalty for investing in those money pits and the taxes and had $50,000 a year, primarily taxed deferred cash flow in those 10 rental condos and 3 years later they doubled in value.

I told my story on Podcast 238. In 2015, 2016, and 2017 I 1031 exchanged them for 6 apartment complexes and deferred my taxes to buy 8 apartment complexes in NE Ohio. Now I have $180,000 cash flow and rising!! Not to mention I am increasing the NOI and vastly increasing the value of my apartment complexes too.

To think in 2011, before buying my first little rental condo, I was only making combined before taxes and deductions family income of $80,000 gross per year. I still teach PE because I love it and am only 54 years young!! If I can do this, anyone can.

Swanny

Hi @Dan H.,

We buy the apartment complexes and rents go up about 8 to 10 percent in the first year.  I only buy value deals from burnt out old owners.  Example, average rents of the complex are $600.00 when I purchase it.  The market rents are much higher.  So, at lease expiration rents go up an average of $60.00 (10% increase). That would not be possible now in California.

Swanny

Hi @Thalia G.,

I took all that equity and bought apartment complexes in NE Ohio in our LLC's. If I would have done that in San Diego, instead, my cash flow would have been much much lower, next to nothing. Then, we would have not been able to raise rents now to reposition true value play Apartment complexes here in San Diego.

Swanny

I sure am glad I 1031 exchanged all my rental properties in San Diego for Apartment complexes in NE Ohio.  California Liberal BS does not have any consequence on my 200 units in 10 apartment complexes out there.  People said I was crazy to sell my 10 condos in 2015, 2016, and 2017.  I sold when they all doubled in value and through the power of the 1031 exchange it was all tax deferred!!  Now my cash flow is at $180,000 a year, instead of $50,000.  

WOW!!!  I will live in San Diego forever, but with this new law I may never buy rental properties here again.  We shall see!!

Swanny

I just did two deals.  A 57 unit in a Mentor Ohio and a 24 unit in Painesville Ohio and all 12 of the other complexes that I have purchased the money does not go hard until all our financial and physical inspection dates were over or if we needed to extend, due to financing or the seller telling untruths etc...

I call BS on any one that gives you that hogwash!!

Swanny

@Coco Cook

I just accepted your colleague request.

Swanny