So far this year and what I’ve archived

[Mike Khalil]

First of all i wanted to say how impressed and thankful i am for finding this group of people here on BP, this is what you call a community!!!

A big dream of mine was to always gain financial freedom through REI. But I had no experience and the only way of making this a reality was to learn so I have been reading and listening to podcasts for about 2-3 years now and just sitting in the background picking up all the knowledge I can get from my fellow BP pros and some friends and family that are in the RE world.

So finally this year I decided its time to make that jump and execute on my plans and goals I had set my self. I started networking with a few wholesalers in the area and was able to pick up my first investment property in March of this year.

Purchase price: $207k

Rehab/Hold cost: $18K

Appraisal: $270K

Refinanced out of the HML to a conventional loan after rehab was done (1 month) and the property has already been leased out before i even closed on the loan. Cash flowing $350 after expenses and vacancy.

2 months later I got my hands on another decent deal and pulled the trigger on it.

Purchase price: $186K

Rehab/Hold cost: $15K

Appraised: $235k

Rehab took a little longer on this project because of some issues I had with the GC but was able to get off the HML and switch over to a conventional loan right after the 2 months of rehab and got it leased 1 month later, cash flowing $350 as well after expenses and vacancy.

My goal is to get to 10 SFH in 24 months, 2 down 8 to go. After getting some experience and more capital i plan on eventually tapping into the MF and commercial properties 4 units and up.

Definitely not the best deals but had to get the ball rolling and get the feel of being a landlord to build on my success.

Would love to get you guys input on what you think i should’ve done or if i am on the right track.

[John Chapman]

@Mike Khalil, that first deal in particular has some pretty impressive numbers.  I'm impressed you were able to get such a large bump in appraisal given size of rehab, and certainly was an impressive equity play.

I'm not sure what types of houses you're buying I'd caution you to slow down a smidge or pivot to assets that cash flow a little better.  I don't know what kind of rents you're getting (I could guess), but those higher priced properties in DFW do not cash flow well, if at all, as rents tend to flatten out pretty quick.  If property taxes haven't caught up to you yet, they will and they hurt.  Those rehab numbers are light so watch out for increase maintenance going forward.  Finally, you need to make sure you are not buying too large of a house (make ready and maintenance will kill you).  Could be worrying for nothing, but I see alot of people buying houses that don't make much sense.  (Not saying that's you)  Been doing this for almost twelve years so I've made tons of mistakes over the years.