$ 500K , What should i do . Multi Family Investing

[Mike B.]

I figured the Subject line would catch  your attention lol so lets get to it 

26 Year old , Passive investor with a few retail commercial buildings ( $700K average price tag )  all rented out  and a couple business i run , all owned by me . 

What is my goal - Build Wealth but more importantly build an array of cash flowing properties that are recession proof . honestly , i want to reach a point where I can cash flow $100,000 Monthly from my properties by 45 , i know that may come off as unattainable or unrealistic but it is doable for sure  . I've taken into consideration 3-5 years for a recession or dip . And i would invest business income  and cash flowing properties back into the next one to try to achieve that goal quicker 

Resources - I have decent income yearly from personal businesses but i want to supplement it . 

Education - Ive remodeled some retail buildings and rented them out but nothing fancy like a 30-60  unit apartment complex or bigger . The resources i have , the team is what i would like to solidify 

What team members i need - Professional real estate Tax accountant , that knows how to reduce taxes to $ 0 little by little . ( tom wheelwright ) Mortgage brokers who can get loans for me at decent rates with good amortization . I have decent credit and i would put the loan in my name , i qualify . I could use another solid lawyer who knows the ins and outs . solid Plumber , Electrician and Engineer that are quick , reasonably priced , and do thorough  work . Of course , a few commercial brokers , property managers or mortgage brokers  who can find me the deals . Thats important . I don't want to do syndication , im trying to steer away from that unless thats the only option i have . 

This is the Preferred Property im looking for or similar  . And please comment or suggest i'm an idiot if you like or recommend something i may be missing . Either or works 

Well just use this as a simple example 

24 Unit apartment Complex ( B-  or C +  type  property 

Purchase Price - 1,920,000 ( $80k Per Unit ) may be low in this market 

Down payment - 25% = $480,000 

Rehab - $ 6,500 per Unit ( some units  more than others ) = $ 156,000

Common Rehab - Water Heater , laundry room if it has one , Paint of building , landscaping , windows , parking lot  , roof ( 10k - 70k ) This ranges a lot depending on the property 

Closing cost - 20-30k 

tax - 7,000 / year 

insurance - 12,000 ( wind n hail , general , fire  ) / per year 

Property Management ( 10 % ) = 2,160 / per month 

vacancy - 10 % = $ 2,160 per month 

Cap X ( fridge , window , curtains , doors , paint , roof , pavement ) - 1,080 / per month 

Landscaping - $ 800 per month 

simple repairs - $ 500 -900 per month 

common area electric - $ 300 per month 

Mortgage $ 7,500 ( 30 year amortization  , 4.75 % rate  ) 

Income - $900 per unit = $21,600 , this varies based on area . 

Total expense = roughly $ 16,000 

Profit - $ 5,550  X 12 = $68,000

ROI = Roughly 9-11 %

A lot of fat to trim here . on top of that , a refinance in 18-36 months down the line 

Thoughts , ideas ? help ? 

im ready to do deals like this . 

[Greg Dickerson]

Originally posted by @Mike B.:

@Greg Dickerson

Good point . I have considered reinvesting in my business and myself but I want to lower my taxes and be able to produce income while not working or minimal work ( maybe 20-25 hours a week ) . By no stretch will I force a deal and over leverage myself when it’s not a good deal .

 Remember good times never last and bad times never last. We are in a boom economy right now and it will not stay this way forever so if I were you (and I was 26 years ago) I would work as much as you can and earn all you can right now and ride this wave (which I did) so you can do whatever you want whenever you want in the future (like I do now).