Realistic Strategy??

[David Garrison]

Hi BP - Apparently, I opened a floodgate by starting with my first post. I'm determined to have every angle covered. After all, I have nothing better to do while I save my $$$ for the first purchase. I apologize in advance for the formatting on this. I was hoping it would automatically format from word. Maybe my version is outdated or maybe that just doesn't work here. While working on my business plan, I'm trying to create something basic that will allow me to have a template to follow. This is based on the books I've read and information BP has taught me. You will definitely see similarities so please don't take this plan as my own creation. I've just modified it to fit what I'm thinking. The $750 rent figure is well below what a 1BR unit would rent for in this area. I just want to be extra conservative on the numbers. I feel like $1000/mo in this area may even be low. I'm aware that no strategy can be perfect. Real life will effect the timeline. I'm also only considering my own income as a means to save to make the first purchase. I don't plan to quit working until my properties provide at least 2-3x my current income. This also doesn't include my future-wife's income or financial assistance family members have suggested they'll offer. Also, any potential pay increases, windfalls, inheritances, etc are not included. Essentially I'm trying to save to buy the first place and then use the investment to seed the other purchases. If necessary, I would potentially use any other income sources to speed up, stay on target or address pain points. I'm suggesting a 10 year time frame as a ball park because I will use any additional income to speed this process along. Overall though, I view this process as a 10-20 year plan which allows me to retire and just run my properties. This plan assumes that I stop at the 10 year mark and immediately begin paying everything down as quickly as possible to then live off the rental income and help my future wife's dream of owning her own restaurant come true. Also, I may be having so much fun with my dreams being a reality that I'll just keep buying. Is this plan realistic or too ambitious? Why or why not?  What should I be researching and concerning myself with to make this plan actually happen? Feel free to school me. I won't be offended. Learning where I'm wrong will ensure I find success when I get started.

• 1.Purchasing Plan + Time Frame (10 year plan)
• a.Year One
• i.Purchase Quadplex
• 1.Owner-Occupied
• ii.Roughly 2019
• 1.Greatly depends on Savings Plan success
• b.Year Two - Five
• i.Purchase Quadplex
• 1.Refinance Year One Purchase
• a.Cash Out to buy Year Two Quadplex
• ii.Rinse, Repeat Strategy of Refinancing
• 1.By Year Five own 5 Quadplexes (20 units)
• c.Year Six - Ten
• i.Purchase 2 Quadplexes per Year
• 1.Refinance Strategy
• 2.Earned Income from Working
• a.Only if necessary to stay on pace
• ii.Results in 15 Quadplexes
• 1.60 units
• a.Rent Each at $750
• i.Gross - 45,000/month
• ii.Gross - 540,000/year

Even if I pare down to 1 property a year through Years 6-10 that would result in 40 units

40x750x12 = 360,000/yr Gross Income.