All Forum Posts by: Riley Schaefer

@Lisa Waldman

Graham W. Parham - Highlands Residential Mortgage

@Angel Latimer

We've invested with them for about four years, and have purchased multiple properties.  We have nothing but good things to say about their team & properties, and I know many others that feel the same.  I just left a detailed comment about this on the thread below: 

https://www.biggerpockets.com/forums/92/topics/518583-feedback-on-renttoretirement-and-zach-lemaster

@Matt Maupin

We just refinanced at 2.25% for primary, and invested in a rental property where we got a 3.5%. Best I've ever seen for both! I'm happy to share lender recommendations if needed.

@Eileen Wang

I agree with Eric.  It's important to have a good CPA on your team to ensure you are filing taxes appropriately.  The majority of the accounting/book keeping is done by the management team.  You may have to manage your mangers sometimes if they aren't providing the level of information that you need, but I've been pretty happy from the experiences I've had so far with management.  So I would say to carve out a few hours every month to review the performance of your properties, and check in with your management team to make sure everything is operating smoothly.  

As long as tenants are paying rent every month, your rentals should be on autopilot for the most part.  I think the best application of your time is focusing on how to strategically build your network/team in the locations you want to invest in, and how to scale your portfolio over time.  This are the things the rent to retirement team will assist you with.  Concentrating on growing your education & how to creatively purchase more cash flowing properties is the most valuable hours spent regularly.  It's best to delegate the operational tasks for things like management to the local professionals to give you time to focus on the higher level concepts.  Just my two cents on the matter.

@Esteban Jimenez haha too much time, but all good education & networking.  Careful...sometimes there is too much information, and you can spend hours going down rabbit holes or chasing the next shiny object!  ; )

@Gohar S.

We have done multiple 1031s on the TK properties we've purchased. Our typical holding time is anywhere from 4 to 6 years, and then we look to refi or 1031 to expand our portfolio. It doesn't really matter if you're buying at market value via the TK route, or via MLS because simply owning rental RE over time will naturally build equity through appreciation & debt reduction (not including cash flow or tax benefits). To use a simple example, one of our homes we did a 1031 on we purchased was about $100k 4 years ago. We put 20% down ($20k) initially to purchase it, so we already had $20k equity in it. After selling it late last year, we found that we averaged about 6.5% appreciation each year over the past 4 years (we sold it for $126,000). During that time the loan principal was also paid down about $7k. So we had about $33k of equity along with the original $20k we put down for a total of $53k to invest which we put down on a duplex that cash flows almost triple of what we originally were seeing. This is a great way to creatively expand a portfolio over time without adding any additional capital to buy more doors, and to drastically expand your ROI/cash flow! Our plan is to keep trading up over time! Hope this helps.

@Jake Tolton

We've enjoyed working with the rent to retirement team the past few years, and are still working with them.  We own a total of 14 doors at this point, and we should be up to 16 by the end of Feb.  Most everything has been performing as expected with very little unexpected occurrences.  We've only had a couple vacancies so far, and both those properties were leased to another tenant in under a month so I would say our cash flow has been better than initially projected.  I'm sure over time that will average out, but we have owned many homes for close to four years now so I think that is long enough to give a true evaluation of performance.  We haven't really seen any impact due to covid which has been nice.  We did waive a late fee for one tenant back in April & May when they had a temporary pause in their employment due to shutdowns, but they applied for unemployment benefits which more than covered their rent, and they quickly caught up.  I believe that is the benefit to investing in the locations & housing classes that we do since these locations seem to always have rental demand & affordability.  Plus many of these midwestern states do not have as much economic impact as the densely populated costal states where we do not invest.  Other than waiving the one late fee, our rentals have performed as expected with no issues throughout covid.

I would like to point out that I used to own & manage my own rentals which was a nightmare. I didn't know what I was doing, and was not able to truly commit the time necessary to do an effective job at managing my own properties.  I did eventually hire a local mngt team that did an even worse job that I did!  Because of my previous bad experience I took a few years off from investing not knowing another way to do it. When I was introduced to rent to retirement from a friend who had invested with them it blew my mind that this was even possible to invest this way. Naturally I was skeptical at first, but I decided to purchase my first couple of rentals to see for myself how things would work out. So glad I decided to take that first step!

On a more higher level I would like to mention that @Zach Lemaster & the rent to retirement team has been a tremendous help in us developing our overall investment strategy! Up to this point we've not only purchased many cash flowing properties in numerous markets, but we've also been very creative to expand our portfolio beyond what we would have likely done on our own. We've completed a HELOC loan, invested through a SDIRA, completed two 1031 exchanges, and we just now are doing our first cost segregation study on our portfolio to reduce our 2020 taxes to zero even though we made over six figures! It's crazy how many tax benefits there are to investing in RE. Once you fully understand all the benefits you wish you would have started to invest many years earlier! In summary, we are still working with the rent to retirement team, and would fully recommend them to anyone looking for guidance on how to build a successful, long term portfolio in excellent cash flow markets. Hope this helps, and fee free to send over any specific questions you have.

Prefer to stick to what I know, what has been a proven path for years.  People always need a place to live!

@Kevin Gray

Can you expand on what unexpected tax bills you are talking about?  I am aware if I sell within a certain timeframe some of that depreciation will have to be repaid, but I'm looking at a 7 to 10 year hold period with a 1031 exit.

@Lee Ripma @Michael Plaks

Thanks so much for the info!

Can you tell me in general how a CS study works, in what cases it would make sense to do one, and what happens during the sale of the home? Also, any idea what it would cost for a single or few SFRs?

I am familiar with the term, but I am generally very unfamiliar of what a CS even does?  Thanks in advance for your assistance!