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Updated over 5 years ago on . Most recent reply
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Thoughts, Advice, Direction on "leveling up" plan
Hello,
I'm currently putting a plan together that involves me selling my 3 duplexes + 1 condo and using 100% proceeds towards a down payment for a larger 8-16 Unit building. It's definitely more complex than described but that's what I want to hash out. Timeline is as follows...
-Source a "list" from a sites like ListSource.com*
-Please recommend your favorite source for lists like these!!
-List criteria needs to be properties in a certain area, built after 1978, 4+ units, etc
-Help me narrow down my list! Ideal property is as follows..
8-12 Unit, Landlord pays no utilities, garages, minimal lot size, not owned by a big corporation, mortgage at least half paid off, Forced air, Etc.
-Are any of the above a "criteria" that can be checked on these sites? What Criteria would you add?
-Once the list is obtained, I will attempt to get a phone number to the owners who are not within a 25mile radius and physically door knock the rest.
-Thoughts on ideal phone conversation? If I need to send a letters, ideas for content in letter?
-My goal is to get an "off-market" property for roughly $1mil-$1.25mil under contract. Preferably some elderly couple who are ready to let it go. I would explain to them the situation and my plan. They would then allow me to keep their property under contract for 6 Months while I list all my current properties. Im a Realtor so listing is quick and it's 3 duplexes next to each-other in a hot area with great rents and tenants. No problem getting it under contract and closed within 6 months.
-Prior to closing (or when would you suggest?) I will file a 1031 exchange with all the properties. Currently Im in the process of taking all properties out of my personal name and into my LLC.
-Im refinancing my current properties and during that deal I will have the title switched to the LLC. This is my best course of action correct?
-Closing is completed within the same week for selling all the properties and buying the new property.
-Who is helping/holding my money/filing my 1031 exchange paperwork during this time?
-I take ownership of the new property and start improving each unit once the current lease is up. New flooring, paint, fixture, kitchen, etc. Rehabbed, I max out the rent. This process will be on and off over the first 2 years. I plan to hold for 4-5 years max.
-Year 3 or 4, I start the searching process all over again. Of course it will be fine-tuned and more efficient by that time. With 20%-30% of the note being paid off at this time + appreciation + sweat equity, it's going to be quite the down payment for the next level.
-All the while, during those on and off times, I will continue to be a agent to my circle, flip in my "farm" and purchase other rentals if they fit the bill. Not to mention the actual income from the rentals during that time.
To end this, I wanted to acknowledge I can see that some of this stuff might be looked at in the perspective of "Easier said than done" or " That's Real Estate Investing 101, Rookie" and I want to say both are right, I'm mostly writing this here to get it out of my brain and into writing. I figured if i'm going to write the plan down, might as well ask for any and all opinions. I look forward to reading them!
Thanks