Any Success Stories in Rentals? Does my idea make sense?

Question

Has anybody made serious money in rental? i know it builds over time.

Im looking to buy some houses around 65-80k and rent them out and slowly build up to enough houses to make some solid cash. anybody has already done it?

Im looking looking at lets say, 1 house about 70k put 20% down, your mortgage is about 350, PM and other maintenance and insurance cost cost $250 more.

You can probably rent it out 850-1100 in those area where im looking at.

lets say i get a tenant who is paying $900 a month and my expense is $600

Im making $300 on each property. $300 is not much and wont last long but if you can own 50+ houses you are making good money.

I understand your first 4 houses you can finance it after that its a different method.

I would like to hear other people thoughts and suggestions. Can I make money this way?

1 thing i've learned is that it takes money to make money!

BTW, im based in Lawrenceville GA, Atlanta Ga. Any agents or fellow member have some things in GA, I would love to check them out and learn from it too.

Rob K. · Answer

Shaneel Lalani It sounds like you have given this a lot of thought. Like others have mentioned, it takes a long time. It's like farming. You put the work in now and you really cash in at the end.

Many of the naysayers will scoff at a profit of only "$300" per month, but then spend more than that on cigarettes and lot rent for their trailer and retire with nothing. You're forward thinking enough to realize that if you have 50 houses at $300 per month, you're netting $15,000 per month. Not a bad income.

I would say go for it. Start with one and then buy another and another. If you don't like it, you can always sell. There's a lid for every pot and real estate is very forgiving. I've bought houses that i shouldn't have and still found a way to turn a profit.

Good luck to you.

Jeff Kehl · Answer

Hi Shaneel , 
I've been following a similar strategy to what you describe for the last 4 years not far from you in Rome, ga and its certainly possible. I have more than 20 properties now and so far so good.

From what I hear lawrenceville is a better place to invest than Rome. Faster population growth, lower unemployment and higher rents. That's the good news. The bad news is you'll probably have a harder time finding deals and you'll face more competition. The word is out that Atlanta is a great place to invest.

Couple pieces of advice. Look through the mls for properties in your price range in your area that mention bank owned or foreclosures. Whatever agent has the listing on the most,  use them as your buyers agent.

Good property management is key. Spend a lot of time making sure your using the best property manager in your area.

Find a good small local banker and explain what your doing. They're key after you get past 10 properties.

Find an honest contractor to do your rehabs.

Take a look at 2-4 unit buildings. Cash flow is better and there's a lot on the market.

Shaneel L. · Answer

Thanks for the reply everybody! I'm shocked how many honest n helpful people are here!

You guys made me pumped up! Now I can't wait to find a property and rent it out!

Thanks again everybody!

Shaneel L. · Answer

Thank to guys!! Thanks so much.

So basically I should look for a house that's in for closure and buy it... I'm having tough time finding an good real estate agents. Most are ok, and want a exclusive letter agreement. I've told them I won't sign exclusively!

I might look at some forclosure property and use the selling agent as my agent.

Thanks for helping people!

Raymond B. · Answer

Shaneel Lalani,
I suggest that you spend some time in this area of the forum:

https://www.biggerpockets.com/forums/52-rental-property-questions-landlording-issues

Also, spend some time reading this, to use as a guide for rentals:

https://www.biggerpockets.com/forums/52/topics/18371-help-me-understand-this-deal-and-5-2-rule

Raymond

William Donaldson · Answer

Welcome to BP Shaneel.  There's been a lot of great advice posted so I'll just post a small nugget I've gleaned from the experts on here:

Don't jump at the first "deal" you see.  Make sure your excitement and ambition to own rentals does not cloud your judgement.  The better the deals, the faster you can reach your goals!

Shane Johnson · Answer

Hi Shaneel, welcome to BP, and I am glad to see you so motivated. I am in the same boat. Based on your topic, content of posts, and questions your asking, I highly suggest you do a lot more reading before diving in, as some of your questions are a little green. Do a lot of searching, and reading on here, as well as via Google. Your example up top was very basic, and their a lot of hidden costs/maintenance costs, and unexpected things that can happen in rentals. If it was that easy, everyone and their brother would be doing it, and succeeding. This is a great community and resource, so use it fully, so you can learn from others mistakes. Good luck! :)

Account Closed · Answer

Making money in rentals is a slow process,  I've been at it now for about 20 years and realize that we could retire on what we have.  No intention of retiring just yet though.

Lots of ways to make rental investments work though.  You have to buy right, manage or have others manage them right,  and plan your investments.

Kyle Meyers · Answer

There are a couple of buy and hold investing strategies. You can buy for appreciation, or for cash flow. You should be able to find units that rent for ~$600 you can purchase for ~$35k or less. It may not appreciate as well, but you will get better cash flow. When you have it rent ready, advertising is the best way to quickly find a tenant. If you don't get a lot of response, you can drop the rent or offer a move-in special, etc. There is lots of advice on this site to help you as you get started.

Shaneel L. · Answer

thanks for the reply! yes, im looking it as a long term investment but trying to make a living of the SMALL RETURN (300). i know in the long run it will double and etc and it will take time.

capital is not a problem. im just hoping I can find some good properties and be able to rent it out quick. since im new in the business, im nervous about what happens if nobody wants to rent my apartment and etc, but i am looking it in the good school area and etc, so hopefully I wont have that problem.

Anybody else had these nervousness when they first started? how did it turn out?? thanks!~

Any Success Stories in Rentals? Does my idea make sense?

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