I just found your channel. Great stuff, keep making it! I'm similar rental portfolio phase as you 15-20 range of units. I call it the "semi-pro" league. Still have a lot to learn, but definitely on the way. I wish I had started 10 years earlier in my 20's like you did. What I've found so interesting about your channel is you are self-managing which I had done at the very beginning of our rental career but switched to PM based when we started a family so we could focus on that. Frankly, I'm considering transitioning back to self managed over time because I feel I did a decent job of it and also it's hard to find a PM who works the way I want. I feel like I'm learning a lot about making a jump back from someone who is at a similar stage of the rental game, which surprisingly there are not a lot of channels like this. Most are either aimed at total newbies or they are 'guru' channels who ultimately want to sell you something. Congrats on your success so far!
Thank you! When I was just managing the properties from my dad it was super easy. The tenants were all very long-term tenants and because the houses had been upkept I probably got one call every couple of months for 9 houses. Buying tenant occupied properties that haven't had much care for years has definitely increased the amount of calls I'm getting and the time I put into managing the properties, but I expected that. But I think it can still be a very low time commitment even managing 20 properties if you have the right tenants and the properties are upkept - at least I'm planning on that! I will also add because it looks like you have kids, that going to the rent houses with my dad was one of my favorite things to do as a kid.
@@ItsMandy Most of my units were purchased from retiring landlords so inherited tenants (some good some terrible) and lots of deferred maintenance, or I paid closer to retail for buildings that while rentals, were in solid shape already. If I could do anything over, I would buy distressed units for cheap, spend the up-front $ to rehab everything, and place new tenants, then refinance. All my rentals are out of town a few hours away so I don't really want to self-manage those, but I'd like to pick up some in my area to self manage. The local market is stupid ridiculous now. There's only about 3 houses for sale not under contract in our whole town of 20k people. Everything gets bought in a day or two and the prices just keep skyrocketing up (way faster than rents.) If you have a rental, you can rent it out and have 100 applications in a couple days, the problem is getting into a property at a price that won't be under water for the rental market. I'm actually selling a few of my out of town rentals to take some profits in this nutty market and either pay off some of my other best performers, or use as dry powder for buying something local when it comes up. I think the kids would like helping with the houses too. They always want little jobs to earn a few dollars. Thanks for sharing that memory.
I guess one thing you missed- because of the repairs and maintenance you did, your properties are worth more. the improvement in value is equity, which is also a good thing. Good job with the repair and maintenance! and don't underestimate your profit :)
Great content! Do you do have a business bank account for each property or one lump business account that holds all deposits/payments and you pay expenses from?
I have one bank account for everything. Some states require a separate account for deposits, but Arkansas does not. I know some people prefer to have separate accounts for each house, but I would be totally overwhelmed trying to keep track of 18 different bank accounts. Plus, I think having one bank account will make it easier to pay myself if I ever decide to take a paycheck in the future.
Nice job. One comment I want to make, it's not correct to deduct the ~27k that you borrowed from the profit. Actually you are paying the interests for it and it didn't affects your cash flow. If you are calculating the cash flow, you should not deduct that part. And if you are calculating your profit, you should not deduct it, either. Instead, the principles that you pay to your mom is becoming you asset as the form a house, if you don't consider the appreciation of the house.
I just found your channel. Great stuff, keep making it! I'm similar rental portfolio phase as you 15-20 range of units. I call it the "semi-pro" league. Still have a lot to learn, but definitely on the way. I wish I had started 10 years earlier in my 20's like you did. What I've found so interesting about your channel is you are self-managing which I had done at the very beginning of our rental career but switched to PM based when we started a family so we could focus on that. Frankly, I'm considering transitioning back to self managed over time because I feel I did a decent job of it and also it's hard to find a PM who works the way I want. I feel like I'm learning a lot about making a jump back from someone who is at a similar stage of the rental game, which surprisingly there are not a lot of channels like this. Most are either aimed at total newbies or they are 'guru' channels who ultimately want to sell you something. Congrats on your success so far!
Thank you! When I was just managing the properties from my dad it was super easy. The tenants were all very long-term tenants and because the houses had been upkept I probably got one call every couple of months for 9 houses. Buying tenant occupied properties that haven't had much care for years has definitely increased the amount of calls I'm getting and the time I put into managing the properties, but I expected that. But I think it can still be a very low time commitment even managing 20 properties if you have the right tenants and the properties are upkept - at least I'm planning on that! I will also add because it looks like you have kids, that going to the rent houses with my dad was one of my favorite things to do as a kid.
@@ItsMandy Most of my units were purchased from retiring landlords so inherited tenants (some good some terrible) and lots of deferred maintenance, or I paid closer to retail for buildings that while rentals, were in solid shape already. If I could do anything over, I would buy distressed units for cheap, spend the up-front $ to rehab everything, and place new tenants, then refinance. All my rentals are out of town a few hours away so I don't really want to self-manage those, but I'd like to pick up some in my area to self manage. The local market is stupid ridiculous now. There's only about 3 houses for sale not under contract in our whole town of 20k people. Everything gets bought in a day or two and the prices just keep skyrocketing up (way faster than rents.) If you have a rental, you can rent it out and have 100 applications in a couple days, the problem is getting into a property at a price that won't be under water for the rental market. I'm actually selling a few of my out of town rentals to take some profits in this nutty market and either pay off some of my other best performers, or use as dry powder for buying something local when it comes up. I think the kids would like helping with the houses too. They always want little jobs to earn a few dollars. Thanks for sharing that memory.
I guess one thing you missed- because of the repairs and maintenance you did, your properties are worth more. the improvement in value is equity, which is also a good thing. Good job with the repair and maintenance! and don't underestimate your profit :)
Congrats on a successful year!!! I think youre gonna go far and im looking forward to following along and learning!
Great video! Could you talk about financing properties past the Fannie/Freddie limit?
Great content! Do you do have a business bank account for each property or one lump business account that holds all deposits/payments and you pay expenses from?
I have one bank account for everything. Some states require a separate account for deposits, but Arkansas does not. I know some people prefer to have separate accounts for each house, but I would be totally overwhelmed trying to keep track of 18 different bank accounts. Plus, I think having one bank account will make it easier to pay myself if I ever decide to take a paycheck in the future.
Do you not pay yourself? Isn’t that an expense out?
Nice job. One comment I want to make, it's not correct to deduct the ~27k that you borrowed from the profit. Actually you are paying the interests for it and it didn't affects your cash flow. If you are calculating the cash flow, you should not deduct that part. And if you are calculating your profit, you should not deduct it, either. Instead, the principles that you pay to your mom is becoming you asset as the form a house, if you don't consider the appreciation of the house.
And when calculating the profit, the part that should be deducted is the principle part of your owner financing income.
How do you live off 15k for the year? I’m assuming you have another job?