New Face in the DMV!

[Sam Valme]

Hello BP Members!

I feel like I've finally found a (metaphorical) home! But before I get into all that I'll start with a quick intro. ;)

My name Sam Valme (pronounced "val"-"may", Haitian decent). I am a software engineer by trade who is looking create financial freedom for my family through real estate investing. I stumbled upon the Bigger Pockets while looking for Real Estate books in the iBooks store. I actually didn't come to the website for probably 3 months after reading that first book. But now that I have I can say that I'm EXTREMELY glad I did.   

After listening to the podcast for the past two days straight I really feel like BP is the place I've been looking for these past few years. In my day job I do a lot of client consulting. By far the most important thing I've learned is networking and your resources are key in every situation. This principle is something that has assisted me since day one. For everyone interested. Here is the story of how I got the investing bug. 

I got into "real estate" when my mom and step dad gave me a choice at 18. Either A. I go off to college or B. I pay the mortgage. They were planning to move to another location at the time. I'm sure they figured I would choose A, they would sell the house, and life would go on. I was working at Best Buy at the time making around $300 a check. There was absolutely no way I could afford a $1300 a month mortgage + $400 in Utilities. But I knew I had a lot of friends from work who were looking for a place to live. 

I really look at this as my "first" Real Estate deal. My parents bought the house around 2008 for a steal at 160k. It was trashed and we did a ton of renovations before we had moved in. By 2010 when they gave me this ultimatum. The house had raised in value and they were looking to cash out. They put about 14k into the house and by 2010 it was probably worth around 220k. Not too bad for a 2 year investment. 

 Personally, I knew I wanted to go the local community college to study IT. Everyone told me it was a good idea and frankly I was just too lazy to apply for regular colleges. So I chose option B and cut a deal. I knew I could rent out 4 out of 5 rooms including myself. Total we could pool together $1400 for rent. That was stretching us all pretty thin I might add. The way I positioned it to my parents was:

1. Accept $1400 total for rent, take a loss on part of the utilities for one year.

2. For the next two years increase rent by $150 annually. I assumed we would get better jobs/raises/etc.

3. I'll manage the property and perform small repairs.

4. The equity you'll gain will offset the loss on rent in the long run. (This came from watching too much HGTV. I had no idea what I was talking about but they bought it!)

5. (Which i can't believe they agreed to) When you sell, for my services managing the property, I would like a percentage of the equity gained. 

The vaguest semi house hack in history. Also, of course, none of this was written down. But they agreed. I downloaded some leasing templates off the internet signed my friends. And the rest is history. 

A lot has happened the past 5 years. To skip ahead, I got married, got a Dog, started a property management company and began running our business formally. We bought a washer and dryer for the upstairs and essentially separated the home into two living spaces. 3 bed 1.5 baths upstairs. 2 beds 1 bath downstairs. My wife and I rent out the upstairs to 3 friends. We live downstairs and pay $550 total for the two of us for essentially a two bedroom apartment in Northern Virginia. Not too shabby.

Now that our cashflow is much more mature we'll be ready to purchase our first home around Feb of next year. After talking through things with my wife, we agreed that our current living model allows us freedoms that not many folks our age are allowed. So we decided to purchase the house from my parents. The house is now valued around 330k. My parents honored their word to a younger me and we negotiated 26k as my cut for serviced rendered. There were also some repairs to the home that gave us some leverage.  

We're looking to use this money and addition to some we've saved to pay off some debt and reinvest. Until listening to bigger pockets we just assumed we'd have to save up 30k every year to purchase another property. But, the past two days. I have began to see the light. There are so many different ways to look at this coin. Hearing the stories of those who had done this before has been extremely inspiring. 

As of now we are looking for any groups that connect in the DMV area. We'd love to meet with other investors and understand how they operate. I'm sure Bigger Pockets will continue to be a huge asset to us in our rental business. Who knows, we may even expand to flips and more one day! 

Thanks for taking the time to read this for all those that made it. If your in the DMV area or know of any other Investors/Landlords locally please connect me! I'd love to start the conversations and am open to meeting up to learn the ropes!!