36 yr old mom with 5 young kids and 20 doors in 7 months!

[Brooke Jackson]

I started in real estate investing 10 years ago when I bought my first duplex in Lehi Utah. At the time, Lehi will still farm county but was starting to grow. I was living in Brazil at the time and my husband and I were expecting our first child. I wanted to move back to Utah so I started looking for areas that I wanted to buy a house. 

I started by calling the city building and planning committees in a few counties as well as researching the potential growth in the area within the next 5 years. From all that I was seeing, Lehi had great promise and it was expected to triple in size within the next 10 years due to a technology/business boom (Lehi is now referred to as Silicon Slopes in the Tech industry and has in fact tripled in size since I first purchased my property). I decided that I wanted to buy in the area and I found an ugly under valued house that had a basement apartment that I could fix up and house hack.

With an FHA loan I was able to buy the property for $167k and $10k down. The house was 4000 sqft and had 7 bedrooms/ 4 bathrooms with 2 kitchens and .33 acres.

I lived in the home for 1 year while renting out the basement. I then moved into my friend's parent's vacation townhome for $600 and rented out my entire house. My mortgage payment was $900. I was receiving $1350 from my basement renters and $1650 from my upstairs renters.

I kept this rental for 10 years and was a landlord to over 25 individuals. There were several maintenance issues that seemed to happen only on holidays, including a burst hose on the washer unit that flooded my basement on Halloween night. I went over at 7:00pm, in my Halloween costume and pulled the carpet, mopped the floor, got fans installed and apologized to the tenants.

Another incident was when I received a phone call from one of my tenants letting me know that the SWAT Team had busted through the front door, hand cuffed everyone (I had an older couple living upstairs and 4 guys renting downstairs) and started a thorough search though the house. This included busting down 2 of the 3 tenants doors to their private rooms as well as ransacking the tiles in the ceiling. The police had gone undercover and identified one of my tenants as someone who was dealing meth and contacted the SWAT Team to get him. Unfortunately, he was the only one not home. After a high speed chase, they finally caught him and he's currently in the local prison.

This indecent cost me several thousands of dollars in repairs as well as all of my tenants breaking contract and moving out.

I continued renting, however with better back ground checks this time around and found new tenants. I continued to cash flow and things were great. During this time I had moved 45 min away and had 5 kids under 6. Landlording was becoming more difficult with my big family and I decided to sell.

Over the life of the property, including the sale, I made over $500k with only a $10k investment. I was amazed but a little burned out.

I bought a business called snackperk.com in April 2019 that was very successful, however in March 2020, Covid hit and my business suffered greatly. I decided to jump back into residential real estate and I started talking to my friends who were also investing. One friend of mine recommended that I listen to Bigger Pockets and I became even more excited.

Another friend of mine had 40 properties, free and clear, in Indianapolis. I was amazed! So I flew out to see what he was doing. He forwarded me all of his leads from his whole sellers and I found a property that I was interested in. I made a cash offer in the airport the next day on my way home back to Utah. We closed 2 weeks later and I was on fire. Soon after I found another house on the same street and bought it sight unseen.

I started interviewing professionals in the Indianapolis area and put together a team with a really great realtor, general contractor, clean up crew and a property management company. Both properties were distressed and needed a lot of garbage and other stuff cleaned out. I got both properties cleaned up and put one back on the market for $10k more than what I bought it for. The other one is a gut-to-the studs rehab that I'm using hard money to rehab then I'll refinance.

During the same time I found a mountain home just 15 min from my house that fit all the criteria that I was looking for. It was ugly, outdated and undervalued. It was listed for $437k and I offered $380k. They wanted to wait for a better offer and it ended up staying on the market for several more weeks. I reached out again and offered $380k. I didn't want to go above that number. They asked if I'd do $385k and I almost said no, but then decided to see if I could do anything creative on the agent commissions to be able to stick with my $380k offer. At the time I was representing myself, in which both commissions would go to the listing agent. 

I called several agents and finally found one that would give me a 75% kickback on their commissions if I had them represent me. Deal! Everything was already negotiated and ready to go, I just needed the realtor to fill out the paper work and send it over to the listing agent. The sellers had already negotiated a 4.5% commission, 2% for the listing agent and 2.5% for the buyers agent with a total commission of $17,100 ($7600 to the listing agent and $9500 to the buyers agent). At a purchase price of $385k, $7125 will come back to me for listing with my agent that is giving me a 75% kickback once closing happens. This brings my actual purchase price to $377,825. Which is below my $380k offer!

The property was just appraised for $400k and I'm going to use the extra equity as part of the down payment on the conventional loan. I'm planning on putting in $150k to rehab the property in which it will bring the ARV up to $650k. This will give me $100k of instant equity. I can also rent the unit as a vacation home (close to a golf course, Utah lake, hunting, fishing, skiing etc.). Market value supports monthly rents to vary from $6000- 12k per month depending on occupancy and season.

I am now looking at 2 new deals. One is a $2.1m home that is listed for $1.5m (distressed owners with $600k of equity). The other is a 16 unit (8 duplexes) that I'm getting for an initial $250k and a 60 month sellers financing term. The $2.1m home will be a vacation rental where rents can vary from $12k-$30k a month depending on the season and demand. The 16 unit is already cash flowing at $25k a month. 

This amount of scaling is new territory for me and I'd love some advice! My plan is to continue to scale and I'd like to buy a multi family with 50-100 units within the next few years. I love connecting with fellow investors! Thanks for reading. Have a great day!