Shifting from W2 career to Full Time RE

[Liz Ridgway]

I recently left my career in hotel event planning and group sales because I decided that if I am going to be spending 60-80 hours/week working, I would rather put those efforts towards something that will yield better financial outcome. My husband and I own 2 properties, both purchased as our primary residence at the time.Not understanding how to evaluate these purchases for cash flow has left us in a sub-optimal position for our budding RE portfolio. I’m posting to help me gain focus, but I welcome comments and suggestions! 1. FL Condo: Purchased 2007 $142k, Refinanced 2015 30yr fixed 4.9%, $89K loan balance. Mortgage $628, HOA $130, Condo Assn Dues $260. Rented for $1175, take home after 10% mgmt fee is $1075.50 *converted to investment property in 2011 at bottom of market, tax value was $50k. Concerned about basis when I decide to sell **Orlando market is finally coming back to pre-crash levels and home values expected to rise up to 35% by 2021 2. SFH iN suburb of Dallas/Ft Worth: Purchased 2015 $242K, 5% down +ClosIng, total cash $11K (VA loan), 3.65%. Current value $275K, $228K loan balance, Self managed, Rent $1995. Mortgage/Tax/ins $1930, R&M $175. NeIther meets the 1%+ rule. Both In growIng markets. Trying to decIde if we should sell one or both for cash for better buy & hold rental Investment wIthIn next 6 months. Currently lIvIng & renting In Nashville, TN

[Liz Ridgway]

Thank you for the great focus questions! @Jim Goebel

1. Currently reside in Nashville, TN (renting). We move for jobs in the hotel industry with next potential move around July. Strong chance that we will stay 3-4 more years for husbands career advancement but also open to moving as needed. 

We use a property manager for the FL Condo. The TX house is self managed with the help of next door neighbors.

2. Analyzing both scenarios now along with market outlook 

3. I’m handy, but inexperienced. Would need to hire most work done. Would be my own manager and would interview contractors, collect bids, supervise work. Husband is not handy and not willing, but I’m okay with paying for necessary work to be done correctly. We are both willing to live in a fixer during Reno.

4. We have $25k ready to deploy now. Remaining cash would come from sale of 1 or both of the current properties. FL would yield approximately $15k and TX would yield $25k for a total of 65k

5. Agree, it’s been my biggest learning and bigger headache. (Had to become President of the board 10 years ago to protect the investment and while it has been educational, has also been a time suck).

6. Definitely willing to hold the sale of both homes for better market timing. Would rather optimize vs rush for cash.

7. The VA loan benefit deserves digging into. We are eligible for $100k and have used $44k of the entitlement. This leaves us $56k but must be used towards primary residence. Will only be approved for properties that pass inspections. It is a lifetime benefit and funds can be reinstated by paying off the loan(s). For those that may be interested, find an overview here: https://www.vamortgagecenter.com/second_va_loan.ht...

I really appreciate the guidance. I also hope posting from the browser vs the app allowed the paragraph formatting to work!😉