Investor from New Mexico

[Jeremy Garcia]

Hello all, I am a 30 year old investor who is seeking to retire at 45...or earlier. ..through rental property investing.  My goal is to acquire 15-24 properties in the next 15 years to replace my income and be financially free.  Upon retirement...seeing as to how people say you get bored if you don't have something to do...I plan on having my own property management company or be a General Contractor in the rehabilitation of homes.  I really enjoy orchestrating contractors on projects and mainly have this experience through my occupation as a Civil Engineer.  I want to apply this experience to orchestrating contractors to fix my rental properties. 

I have two rental properties. ..one of which I just finished rehabbing. I greatly enjoyed hiring out most of the work and would like to get to the point where I am not doing any work. ..other than the final detail work. 

My next property is going to be four plex and I plan on using a hard money lender/private lender but I have no contacts because I have not really started networking.  I am excited to try this method of using someone else's money instead of my own.  

Any other fellow New Mexicans aspiring for early retirement?  I would love to collaborate and plan retirement with like minded individuals.  I can talk anyone's ear off on retirement and investing :)  Although I am not as deeply vested in real estate as many others here on Bigger Pockets...I have the knowledge and wherewithal to achieve my goal.  My wife has been very patient with listening to my obsession with early retirement,  investing and real estate but I would like to share my passion with more like-minded individuals.  I truly believe in the notion of. .."you are as successful as the people you associate with the most"...or something like that :)

I look forward to networking with others and learning from other people's experience. 

[Marc C.]

@Jeremy Garcia

Hi, Jeremy. I live in Santa Fe and am doing what you are doing: Sold a business, and am replacing the income from that by investing in real estate. Would love to find apartments, as that is my primary interest, but the returns have become so lousy that I'm going with single family rentals for now and leasing them to HUD Section 8 tenants and those interested in purchasing their homes at the end of a long lease. I really believe that, in most places, apartments are in a bubble. With interest rates rising, cap rates can't get any lower. There is tons of competition in the 4-50 unit "mom and pop" size. (50-100 may be better, but who can afford it?) You really have to project that rising cap rates could eat up your appreciation for many years. For example, if you buy today at 6.5%, which would be good for small buildings in Santa Fe, you should plan on selling it (if you even WANT to sell it) at an 8.5%. See what that does to your value in your spreadsheets!

For all those that are interested in Santa Fe investing: WHY? How on earth can you achieve a decent positive cash flow at resort-area prices? I have been looking at <$180,000 properties here since July and have only found junk in sketchy neighborhoods. The rents you can get here do not come close to 1% a month. Cap rates for multifamily are even lower here. And the residential realtors I meet are clueless about what an investor needs. They price their small apartment buildings and plexes according to the cost per square foot, like a house. Their listings often don't include even the rents. Very frustrating. I finally gave up and started looking at Albuquerque. 

Returns are far better in Albuquerque. I bought a 4BR house there for $108,000 from HUD, and I think I can get $1400/mo. for it. In Santa Fe, it would be $180,000+ based on cost-per-square-foot, but the rents might be $200 more. I am in contract to buy a 5BR house in Albuquerque from Fannie Mae for $121,000. It has 2000 sq. feet. It would be well over $200K in Santa Fe, if you could find it. I'm shooting for $1600/mo. Try those ratios in Santa Fe...can't be done. Albuquerque also has far better job growth than Santa Fe, and just more tenants and properties to choose from. Santa Fe, in the end, is a small town. It drastically NEEDS affordable rentals, but they are very hard to find. What needs to happen is multifamily development, and the city is very interested in pursuing it. So, for investing in Santa Fe, I think the future is in building apartments.

We have 3 meetup groups in Albuquerque for real estate investors: 2 for newbies and 1 (new) for experienced investors. For the former, search Meetup dot com for NMREIA and Albuquerque Congress on Real Estate. For the latter, our new Mastermind group is New Mexico Real Estate Mastermind Group.