All Forum Posts by: Ryan D.

@Paul Moore, thank you for your comments, prayers and recommendations. I appreciate it. 

We have definitely heard of the Gerson Therapy. In fact, we had a neighbor with breast cancer that used this method and a long term family friend that also used it. Unfortunately both passed away from their cancer. We have chosen to use a mixture of traditional and non-traditional methods for treatments, and so far my wife is doing well. We are very thankful to God for all the blessings that we have been given.

Given your experience with your family, I take your comments very seriously. I appreciate that very much, and will definitely take them into consideration. It is always helpful to hear from other people who have more experience. Thank you. Also, I'll have to look into Jim Pfeifer's Left Field Investors. He didn't mention that in his post.

@Andrew Hogan thank you for your comments and kind response. I have thought about syndication. It is not where I am leaning at the moment, but definitely something to keep in mind. I think your comment about the reduced risk with 100+ units makes sense though. I do like the higher return potential with a little more active involvement on a more self managed investment however. 

@Mary M. thank you for your thoughts and response. Your comment on SFH vs 4-10 plex makes sense and aligns with what I was already feeling. Also, thanks for the kind warning. ;)

@Jim Pfeifer thank you for your insights based on your experiences. It is definitely something to consider. 

I appreciate all the insights that have been shared. It is really helpful to hear these different perspectives. I would love to continue hearing from others as well. As I am sure most on here have experienced, I am also getting input from others in my life saying I should stay away from real estate as it is too risky. 

I wonder what people's thoughts are on how much savings to put in real estate vs the stock market? Our money is currently spread across bonds and index funds mostly, but it seems like direct investment in real estate has a much better overall return than just the stock market when considering the combined cash flow, appreciation, and tax benefits. However, is it wise to be all in on real estate vs being more diversified? The equity markets seem to be a good long term growth investment, but not a place to get current cash flow, whereas real estate has great potential for both. 

Thoughts? 

@John Casmon thank you. Your first sentence stated things quite well. I think that is part of the struggle. Thinking about our risk tolerance is a good suggestion. 

We have definitely learned a lot from those prior mistakes. We didn't really know much when we bought a duplex and didn't know how to analyze a property. We bought high. It was going well when we lived near by and could self manage. When we had to move away, we initially struggled to find a good property manager, but after a few failures finally found a good one. Unfortunately, he died within 3 weeks of finding out he had pancreatic cancer. He sold his business to another property manager who had no idea what he was doing. It took the new manager 6 months to find a renter for a vacant unit, but then she didn't pay her first month's rent! And he refused to give her the proper notices to make sure we could follow the eviction process if needed. We tried to find a new property manager, but that was a real challenge for a single duplex. Now I know there are a lot more options than I was aware of back then, but we ended up having to sell at a significant loss in 2008. I wish we could have kept it because it would be cash flowing pretty well by now. 

Thanks for the input.

@Jonathan Klemm, that's great that your brother's played here. They have a great football program. Plus, as a Bear's fan you should be familiar with Platteville being the Bear's old practice facility for years. I have been here since 2014. Nice town, but limited investment potential. Thanks for the offer. 

To your point about if you can get started going big from the get go, I think @Eric James summarized my hesitation well. I was recently looking very seriously at an 18 unit down in Iowa, but someone else got it under contract before I was able to get on top of it. For now, Chicago is not in my target area, although I understand the potential. Thanks for reaching out.

Marv, I sent you a private message.

David, Thank you for your thoughts. I appreciate it. Yes, that is another option I have considered. I have also considered the BRRR strategy so as to not just use up all the capital right away, but I think that is similar to getting into value add multifamily and then refinancing, just smaller scale. I have already had a duplex and have no problem with managing larger units, but would likely just go straight to using a property manager instead given my interest in long term passive income. So many things to consider. Definitely struggling with analysis paralysis!

I am seeking input from experienced MF investors. Seeking advice on best way to get started with $450,000 in savings and $100,000 in home equity.

My name is Ryan. My wife and I are looking to get back into real estate investment after a disastrous experience during the 2008 meltdown. We had nightmare property management problems from a distance and lost about $45k between a SF and our duplex. Needless to say we are a little gun shy. We are also in a slightly unusual situation. Neither of us have a W2 job. My wife is a stay at home mom and homeschools our 4 kids. I started a business in 2018 and have faced several speed bumps along the way, so am not yet taking any income from the business, although it has a lot of potential. We took a risk given the potential reward of the business and have been living off of our savings and IRA. Unfortunately, due to supply chain issues due to Covid the business potential profitability has been greatly reduced recently so I am exploring whether I should put all my effort into real estate investing instead.

Additionally, one of the hurdles we faced the last few years is that my wife has metastatic breast cancer in her brain. As a result we were able to collect an early death benefit on her life insurance and now have about $450,000 in savings (currently invested in the stock market and bonds), plus about $100,000 of equity in our home. We would like to invest this money to generate cash flow, and grow our equity over time, but are struggling to narrow down the multitude of options. We also have to be somewhat careful with this money as it is supposed to be there if my wife dies to help support the kids.

We live in a rural area of southwest Wisconsin, although we are just outside Platteville which is a small college town (pop.~12,000). We could probably find some local properties that cashflow well, but Wisconsin's rural counties are all projected to have near zero, to negative, population growth from 2020-2030. Seems risky to me. We are primarily looking at either larger college towns (pop.>60,000), or Midwest cities that have experienced sustained growth such as Des Moines, IA, Madison, WI, etc. 

Our long term interest is to get into larger multifamily (10-20+ units), but concerned that putting all the money into one larger building as our first investment might be too risky. Alternatively, spreading it out over multiple smaller SF/Duplex/Triplex/Quads would allow us to ease our way into it, but would also slow us down from just getting to the larger buildings we are ultimately interested in. Also, my prior experience was that it was difficult to get a property manager for only one or two smaller properties, whereas, it is much easier to get a manager for a 10-20 unit building. 

So many people say get started small, others say just go big from the start. Any advice from experienced investors as to how to get started?

Sorry for the long post.

@Ken Breeze, thank you for the suggestion. I should have noted that seller financing is not an option. He needs the cash for the assisted living as a required down payment. His plan is to use the rest to buy a mobile home for him to live in. He made it explicitly clear that he wants to keep it straight forward and wants to get out clean otherwise he will just list it.

A potential partner identified an off market opportunity that he wants to partner on. It is a duplex in a small town in southwest WI and is currently owned free and clear. The owner lives in it and wants out so he can move his mom into an assisted living home. I think it is worth between $105,000 to $120,000. He bought it in 2007 for $110,000. He wants to be out the door at closing with $75,000 in his pocket. He is planning to list it, but is willing to deal with us since my partner is a friend. We think you could rent the upper (2 bed, 2 ba, ~1100 sf) for $650-$700 and the lower (3 bed, 2 ba, ~2200sf) for around $750-$800/mo. Our estimates are that it needs about $10k in rehab. How should we structure this deal and how can we do it for as little down as possible? What are the requirements for conventional lenders? 

Sorry. I realize I titled this for one thing (recommendations for lawyers and CPA's), and then proceeded to ask additional questions about potential partnership structures. I appreciate responses to both.