Looking for suggestions on next steps

Looking for suggestions on next steps

Rental Property Investor · Fayetteville, NC · Member since 2016 · 30 posts · 15 votes

Hi all,

As the title suggests I am hoping to get some recommendations about my path forward in real estate investing from those who are more knowledgeable and experienced than myself. 

My story:

I am an active duty service-member living in the vicinity of Fort Bragg (now known as Fort Liberty). My wife and I currently own two rental properties and our primary residence.

House 1: 4 bed 3 bath. Purchased for $145k - approximate value is currently $235k. Mortgage is $920, rents for $1700

House 2: 3bed 2 bath. Purchased for 93k - current approximate value is $180k. Mortgage is $500, rents for $1,450

Between just the two rental properties we have somewhere in the neighborhood of $150-200k in equity. My wife makes around $50k per year working two days a week, I make around $100k. While I am grateful for the benefit we've already seen from real estate investing, I am wanting to scale faster and I believe utilizing our untapped equity is a good starting point. Additionally, I am pursuing a career as a CRNA to increase my income (and I'm familiar with the job and enjoy medicine). My long term REI goal is to generate $120k per year in passive income (this number is always going up to account for inflation). As I said earlier, I am just looking for your thoughts and feedback about what you see as a viable next step. I am not usually the smartest person in the room but I like listening to them and paying attention to their advice. Thanks guys!

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  • Jake BakerBusiness Member
    Flipper/Rehabber · San Diego, CA · Member since 2020 · 1k+ posts · 695 votes
    2y

    @Logan L.

    Congrats on your success! That is really good equity and a lot of cash flow for two SFRs. 

    I assume you have been using your VA loan?

    You may want to consider a HELOC - If you want to flip or BRRRR. You can fund rehabs with this.

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  • Rental Property Investor · Fayetteville, NC · Member since 2016 · 30 posts · 15 votes
    2y
    Quote from @Jake Baker:

    @Logan L.

    Congrats on your success! That is really good equity and a lot of cash flow for two SFRs. 

    I assume you have been using your VA loan?

    You may want to consider a HELOC - If you want to flip or BRRRR. You can fund rehabs with this.


    Hey Jake, thanks! Yes we used the VA loan on one of the rentals and our primary residence. I have been considering a HELOC. I am wanting to start growing faster than we have so far. Between our equity in properties and money in savings I believe we could comfortably acquire two to three more houses, we just need to have a conversation about risk tolerance I guess.

  • Jonathan GreeneBusiness Member
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    2y

    This is a fantastic start. The thing to be very careful of is this - "I am wanting to scale faster." That statement alone will cause you to move too quickly and take too much leverage which minimizes those solid investments you already have.

    Ask yourself, why do you want to scale faster? Do you want more doors, more money, or a better path to eventual time freedom?

    You are both doing things right, keeping jobs, upgrading them and making more money while nurturing solid investments.

    HELOCs are fine, but start by just taking a small amount off of one so you don't downgrade your cashflow to much, and use it to do your same thing again. Being boring is the key to long-term success in real estate, not scaling. That comes later when it is organic.

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