Advice on Where to Go from Here

[Rusty Thompson]

Some of you know me, some of you don't. I've been on BP for 3 years & went to the summit. I'm not as active on BP as I would like to be, but life conspires. That being said. It has been a busy 3 years for me & the things that I have learned from BP have allowed me to build a nice little B&H portfolio. Jeff S. & I were discussing my investing via private message & I decided I should make our private discussion public. I am looking for some advice on where to go from here. 

My original business plan was to acquire enough rentals by time I turned 35 to retire from my 9-5 and invest full time, I'm 32 now. For the last 3 years (off & on) I have rehabbed, rented, bought & saved. And I have done well. Now I am reexamining my goals and trying to decide on the best way to move forward. So I am looking for some advice on the most efficient way to move forward.

Some rough numbers:

My portfolio

SFR1 2/1 PITI 620$m Rent 795$m Exps. 20$m [email protected] Value 95k

SFR2 3/2 PITI 720$m Rent 1195$m Exps. 0 [email protected] Value160k

SFR3 4/2 PITI 840$m Rent 1195$m Exps. 120$m [email protected] Value180k

SFR4 3/1 PITI * Rent 900$m Exps. 100$m Owe *

8Plex 13/8 PITI 1420m Rent 5000$m Exps. 500$m Owe 142k @ 9%** ValueIDk

SFR5 3/2 PITI 1100$m Rent 1200$m Exps. 300$m Owe 106k @ 9%** Value180k

Notes:

* Loan pays for both SFR3 & 4

** Hard money 5 year balloon loans. 8plex has 4 years remaining. SFR5 has 5 years.

I just purchased SFR5 last month w/ a 30k$ repair escrow that I will begin remodeling next spring. I am currently renting out the rooms to cover the holding costs.

About me:

I am currently single. I have no living expenses because I live in the apartment attached to the shop on SFR5. I have been "house hacking" since I started this and have not had living expenses for the last 3 years that were not directly associated with expanding my portfolio. I don't have any other debt than my RE Loans. I am not planning to stop "house hacking" in the near future. When I started I had just gotten a raise  to 37k from 31k. Last year I received a raise to 52k.  

I was pretty much doing all the work myself (Landlording, Repairing & Rehabbing) until just a couple months ago. I hired a guy recently to help out with the Rehabbing. I still work 80hr weeks, but things are getting done a lot quicker than they have in the past. 

I am open to all suggestions & don't be afraid to ask anything. 

[Rusty Thompson]

@Jonathan F.

I acquired them in a couple different ways: SFR1= MLS, It was the house first house I bought to live in.(11/06) SFR2 = Auction via Williams & Williams. (08/11) SFR3 & SFR4 = MLS, Short Sale.(09/11) 8PLEX = MLS.(09/13) SFR5= Auction via Hubzu.(09/14) My buying criteria is pretty strict. B+ or better neighborhood for SFR's. They don't come up very often so I look every day. If a deal comes up I find a way to make it happen.

@Hattie Dizmond 

Thank you very much. It was a lot of work. I invested every single cent I have made over the last three years to get where I am now. Things might get easier as the economy of scale comes into effect, but I can tell you right now that my 8PLEX takes more time than my 5 SFR's. I think Singles & Duplexes are perfect for a One man show with a full time job.

@Kirk R. 

My cash flow is probably closet to 3200$ after expenses & repair fund. My living expenses are really low. As I said above, no family & I have been "house hacking" to use the phrase coined by @Brandon Turner . So essentially no living expenses. 

I think my current goal is going to be focus on creating a solid core & getting all the PMCS finished on my properties over the next year. Then I can decide what I am going to do from there. I know deals are drying up around here, so moving forward I am going to have to start focusing on " working on the business, not working in my business". Because unless the increases in real estate prices are the "rubber band effect", things are going to get harder around here.