Author Topic: Making 200k in equity in 6mo - Back down the rabbit hole, long distance RE  (Read 17778 times)

JGS1980

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PTF

sammybiker

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    • Making 200k in equity in 6mo - Back down the rabbit hole, long distance RE
@Bicycle_B Thank you, I appreciate that.

@Spitfire Thanks and I agree, for a MMM types, it's a liberating income level, absolutely.

@Trifele Thank you!

@Dicey Hey, thank you, hope you've been well.  Pretty sure your one house still has more light cans vs all mine...combined.

@tralfamadorian Thank you and good call on the lessons learned. 

- Try and get more inspections done when possible.  It's not always possible and because of this, I largely stopped doing them all together.  But I should still strive to perform an inspection to weed out the nightmare projects like #6.

- Continue to seek bids from other contractors.  I had declined to work with a couple other folks as I had a good thing going with my contractor but in reality, I probably could have saved a lot more money, especially on the last couple of projects, by going elsewhere.  I got lazy and comfortable.

- Establish a schedule and track it religiously.  I did this on the first couple of projects but again got lazy and comfortable.  It's real dollars that are lost every day a property isn't occupied or is waiting on utilities turn on because I forgot, etc. 

- Be more selective and stick to the original goal.  The last two properties I really didn't need and the funding and rehab for these caused some stress that if I could do it over again, I probably would have just passed.  It's hard to say no to another $1500/mo in cashflow and $48k in equity (originally planned for closer to $80k) but it was stressful. 

These are the key lessons learned that come to mind.

@theoverlook Thank you.  Correct, sole owner.  Bank leverage is as follows and you'll see that the amount correlates closely to the monthly cashflow:

Property #1:  $178k mortgage balance
Property #2:  $129k mortgage balance
Property #3:  $115k mortgage balance
Property #4:  $189k mortgage balance
Property #5:  $115k mortgage balance
Property #6:  No mortgage
Property #7:  $79k mortgage balance

@zoochadookdook Thanks and sounds good.   Shoot me a PM, always happy to chat RE.


Chuck Ditallin

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I've had nothing useful to add, but I've really enjoyed following your successful journey @sammybiker . Many congratulations!

Can I ask what the plan is now? I suppose what I really want to know is whether you've enjoyed it so much that you're going to continue mostly because it's fun, rather than just to make money out of it (or was it just a means to an end?)

I guess there are parallels with 'one more year syndrome' vs. 'being liberated from having to work for money but continuing to work because it's fun.' I'd appreciate your thoughts on how you feel about the process.

sammybiker

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    • Making 200k in equity in 6mo - Back down the rabbit hole, long distance RE
Thanks @Chuck Ditallin

Rough plan now is to focus on stabilizing these new properties and debt paydown on at least the lower leveraged properties with a goal to get to a more comfortable portfolio debt to income ratio.  I don't necessarily want to pay off everything but getting a few more free and clear properties is the near term goal. 

Further to that, I want to go back into private lending - lending out 60-70% LTV on projects that investors in my circle are working on, namely single family flips.  I keep first position lien on the property and get to pick and choose my projects.  I was doing a little bit of private lending in 2017 before Hurricane Harvey and have done a couple deals already this year.  Getting more involved with lending and being more passive all while still being involved at a high level in projects and the market is fun.