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Updated almost 15 years ago,

User Stats

3
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1
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John C
  • Midwest City, OK
1
Votes |
3
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Noob to investing, critique my first investment please

John C
  • Midwest City, OK
Posted

I'm not sure why it never hit me to look for a real estate investment forum. I probably spend at least 8 hours per day on forums and sponsor them as well, though none that are real estate related. But now that I'm here, I've read a little and it seems although I thought I was making smart decisions, I may not be. So here's what I've done...

I bought my first investment property and closed on Jan. 22. I paid $29,900 for it. I put 20% down ($5980) and financed $23,920. My payment is $214 per month on a 15 year note.

I spent ~$6000 to rehab it. I paid $600 for a year's insurance. Property tax is $575 per year. So with buying it, fixing it up, paying taxes and insurance and all closing costs, I've got just under $38k in it to date. My renter moved in on Feb. 28. I have it rented for $550 per month. I had the house appraised again this week and should hear back what the value is maybe tomorrow. I'm expecting it to be worth in the $55-60k range. From my point of view, I thought I did pretty well for my first attempt.

Now I read the 50%/2% rule(s). If I understand both of them correctly, I pretty much crashed and burned on both of them. Obviously, there's probably little I can do to correct the errors I've already made, but I'd like a little advice on what I should pay particular attention to as to not make the same mistakes again.

My long term goals are to obtain 6-10 rentals. They will most likely all be single family homes on the smaller side. I also plan on flipping a few houses as well, but only to have funds to be able to buy and hold more houses. Basically, I have the ability to buy and hold 2 small houses. Then I'll need to flip one to go further.

I'd like to point out that this adventure is not intended to be my career to support my family with. Although that would be nice and I may change my mind later, I currently do not need the return on this money to sustain my family. I'm ONLY investing money that I could just as easily blow on other things I've been known to blow money on in the past. But like everyone else, I am trying to make money here. I'm just trying to point out that my expectations may be a little lower than others'.

Thanks for any input.

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