Looking to Build Vacation Home Portfolio

[Stephen Fydenkevez]

I am new to BP. I've been lurking for the last 24 hours and attempting to gather as much information on similar scenarios as I can, but I think its time I started my own thread. I have no real estate background and know very little about the terms/abbreviations, so this post will probably be filled with ignorance - but any thoughts, comments or advice would be very much welcome.

My wife and I currently have approximately 150k tied up in non-real estate investments, and we are looking to make the transition into real estate. While we do not have prior real estate experience, we do have these things going for us:

- We both have steady jobs that support us, we do not need an immediate 'home run'. We are willing and able to put the time in and play patiently as our portfolio grows and matures for long term gain.

- We understand that 150k is significantly larger than the average starting amount for a first time investor. Our target property is around 100k and we would put between 30-50% down. We will learn the ropes on a smaller unit where the risk is not as large.

- We know what we want. I am very familiar with the area we will be investing in, it is a ski area that I have been going to my whole life. While I have not always been looking at it from a real estate perspective, I know the region and how to cater my properties to what the consumer is looking for.

- We have time on our side. At 26 and 24, we do not have to worry about making a number before an imminent retirement.

Our Goal: To support ourselves as full time investors

In the area we are looking, there are many townhome complexes that are currently available for 90-140k. These units rent for roughly 220-400$ per night. Ski season in this area is busy from early December through mid March.

Year 1: 1 unit

Year 2: 3 units

Year 3: 5 units

Given that we have 150k available to us and that we are targeting smaller units, we are hoping that by renting out all 5 units we will be able to own all 5 outright by year 7. At that time we would look to repeat the process, acquiring 1-2 properties per year with the goal of 10 properties by year 10.

My question to you, educated and experienced patrons of BP, does this tentative plan seem in any way feasible, or is it some childish dream of real estate wannabes?

I understand that the work involved in owning 10 properties is significant. Part of this plan involves me leaving my job after we have the first 5 properties and I would manage them full time. I have some web design background and would be responsible for the marketing. After 10, my wife would be looking to leave her job as well as we continue to expand.

I understand that there will be additional costs in taxes, cleaning fees, and advertising - but is there anything else significant that I am missing?

We are looking to monitor the ski area this winter. There are units for sale in various townhome complexes and other units in those buildings for rent. We will be doing our homework over the next ski season to find what we believe is the best purchase, and then we will be looking to pull the trigger in the spring.  

We both really appreciate the time you have taken to read this, and any feedback you wish to give.